Wells Fargo Believes Arthur J Gallagher & Co (AJG) Won’t Stop Here

Wells Fargo analyst Elyse Greenspan maintained a Buy rating on Arthur J Gallagher & Co (NYSE: AJG) yesterday and set a price target of $85. The company’s shares closed yesterday at $74.62, close to its 52-week high of $74.84.

Greenspan wrote:

“We are adjusting our EPS estimates modestly to reflect the updated CFO commentary (principally modestly lower FX, higher amortization and slightly higher corporate expenses) and our 2018, 2019 and 2020 EPS estimates are now $3.42, $3.96 and $4.39 from $3.45, $3.98 and $4.40. Our price target rises to $85 (from $78) and is based on an 18x multiple of its cash earnings (ex Clean Energy) and assigning $5 per share to the NPV of its tax credits. We reaffirm our Outperform rating and think Gallagher is on track to continue reporting industry leading organic growth.”

According to TipRanks.com, Greenspan is a 3-star analyst with an average return of 5.4% and a 63.7% success rate. Greenspan covers the Financial sector, focusing on stocks such as Marsh & Mclennan Companies, Renaissancere Holdings Ltd, and United Insurance Holdings.

The word on The Street in general, suggests a Moderate Buy analyst consensus rating for Arthur J Gallagher & Co with a $79.33 average price target.

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The company has a one-year high of $74.84 and a one-year low of $59.64. Currently, Arthur J Gallagher & Co has an average volume of 814.9K.

Based on the recent corporate insider activity of 51 insiders, corporate insider sentiment is negative on the stock. Last month, Richard Cary, the Controller, CAO of AJG sold 12,667 shares for a total of $911,358.

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Arthur J. Gallagher & Co. engages in the provision of insurance brokerage, consulting, and third party claims settlement and administration services to both domestic and international entities. It operates through the following segments: Brokerage, Risk Management, and Corporate.