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Arthur J. Gallagher (AJG) Q2 Earnings: Taking a Look at Key Metrics Versus Estimates
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For the quarter ended June 2024, Arthur J. Gallagher (AJG - Free Report) reported revenue of $2.74 billion, up 13.7% over the same period last year. EPS came in at $2.26, compared to $1.90 in the year-ago quarter.
The reported revenue compares to the Zacks Consensus Estimate of $2.76 billion, representing a surprise of -0.73%. The company delivered an EPS surprise of +0.89%, with the consensus EPS estimate being $2.24.
While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and how they compare to Wall Street expectations to determine their next course of action, some key metrics always provide a better insight into a company's underlying performance.
Since these metrics play a crucial role in driving the top- and bottom-line numbers, comparing them with the year-ago numbers and what analysts estimated about them helps investors better project a stock's price performance.
Here is how Arthur J. Gallagher performed in the just reported quarter in terms of the metrics most widely monitored and projected by Wall Street analysts:
Brokerage - Compensation expense ratio: 57.7% versus 55.3% estimated by two analysts on average.
Risk Management Segment - Operating expense ratio: 18.7% versus 19.7% estimated by two analysts on average.
Risk Management Segment - Compensation expense ratio: 61.1% compared to the 56.8% average estimate based on two analysts.
Brokerage - Operating expense ratio: 14.2% versus 14.7% estimated by two analysts on average.
Revenue- Fees: $827.10 million versus the four-analyst average estimate of $913.83 million. The reported number represents a year-over-year change of +4.6%.
Revenue- Commissions: $1.66 billion versus $1.63 billion estimated by four analysts on average. Compared to the year-ago quarter, this number represents a +17.8% change.
Revenue Risk Management Segment- Revenues before reimbursements: $358.60 million versus the three-analyst average estimate of $355.99 million. The reported number represents a year-over-year change of +12.6%.
Reimbursements: $39.40 million versus the two-analyst average estimate of $36.80 million. The reported number represents a year-over-year change of +12.6%.
Revenue Brokerage Segment- Commissions: $1.66 billion compared to the $1.61 billion average estimate based on two analysts. The reported number represents a change of +17.8% year over year.
Revenue Brokerage Segment- Fees: $477.60 million versus $570.23 million estimated by two analysts on average. Compared to the year-ago quarter, this number represents a -0.2% change.
Revenue Brokerage Segment- Supplemental revenues: $88.70 million compared to the $82.65 million average estimate based on two analysts. The reported number represents a change of +24.6% year over year.
Revenue Brokerage Segment- Contingent revenues: $59.80 million compared to the $60.48 million average estimate based on two analysts. The reported number represents a change of +10.3% year over year.
Shares of Arthur J. Gallagher have returned +8.2% over the past month versus the Zacks S&P 500 composite's -0.3% change. The stock currently has a Zacks Rank #3 (Hold), indicating that it could perform in line with the broader market in the near term.
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Arthur J. Gallagher (AJG) Q2 Earnings: Taking a Look at Key Metrics Versus Estimates
For the quarter ended June 2024, Arthur J. Gallagher (AJG - Free Report) reported revenue of $2.74 billion, up 13.7% over the same period last year. EPS came in at $2.26, compared to $1.90 in the year-ago quarter.
The reported revenue compares to the Zacks Consensus Estimate of $2.76 billion, representing a surprise of -0.73%. The company delivered an EPS surprise of +0.89%, with the consensus EPS estimate being $2.24.
While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and how they compare to Wall Street expectations to determine their next course of action, some key metrics always provide a better insight into a company's underlying performance.
Since these metrics play a crucial role in driving the top- and bottom-line numbers, comparing them with the year-ago numbers and what analysts estimated about them helps investors better project a stock's price performance.
Here is how Arthur J. Gallagher performed in the just reported quarter in terms of the metrics most widely monitored and projected by Wall Street analysts:
- Brokerage - Compensation expense ratio: 57.7% versus 55.3% estimated by two analysts on average.
- Risk Management Segment - Operating expense ratio: 18.7% versus 19.7% estimated by two analysts on average.
- Risk Management Segment - Compensation expense ratio: 61.1% compared to the 56.8% average estimate based on two analysts.
- Brokerage - Operating expense ratio: 14.2% versus 14.7% estimated by two analysts on average.
- Revenue- Fees: $827.10 million versus the four-analyst average estimate of $913.83 million. The reported number represents a year-over-year change of +4.6%.
- Revenue- Commissions: $1.66 billion versus $1.63 billion estimated by four analysts on average. Compared to the year-ago quarter, this number represents a +17.8% change.
- Revenue Risk Management Segment- Revenues before reimbursements: $358.60 million versus the three-analyst average estimate of $355.99 million. The reported number represents a year-over-year change of +12.6%.
- Reimbursements: $39.40 million versus the two-analyst average estimate of $36.80 million. The reported number represents a year-over-year change of +12.6%.
- Revenue Brokerage Segment- Commissions: $1.66 billion compared to the $1.61 billion average estimate based on two analysts. The reported number represents a change of +17.8% year over year.
- Revenue Brokerage Segment- Fees: $477.60 million versus $570.23 million estimated by two analysts on average. Compared to the year-ago quarter, this number represents a -0.2% change.
- Revenue Brokerage Segment- Supplemental revenues: $88.70 million compared to the $82.65 million average estimate based on two analysts. The reported number represents a change of +24.6% year over year.
- Revenue Brokerage Segment- Contingent revenues: $59.80 million compared to the $60.48 million average estimate based on two analysts. The reported number represents a change of +10.3% year over year.
View all Key Company Metrics for Arthur J. Gallagher here>>>Shares of Arthur J. Gallagher have returned +8.2% over the past month versus the Zacks S&P 500 composite's -0.3% change. The stock currently has a Zacks Rank #3 (Hold), indicating that it could perform in line with the broader market in the near term.