Arthur J. Gallagher & Co. AJG is experiencing an important shift in its organic growth mix, with its Risk Management business expanding faster than its core brokerage operations.
Gallagher Bassett, AJG’s Risk Management Business, reported 16% revenue growth in the second quarter of 2026, including 12% organic growth. This is well ahead of the 5% organic growth in the Brokerage business. Management attributed the performance to strong new business and client retention, while clients continued to seek broader risk-management solutions.
Risk Management growth is less dependent on insurance pricing. AJG said only about 1% of organic growth comes from higher insurance rates, while new business, client retention and business activity are driving more of the growth. This makes Gallagher Bassett’s 12% organic growth notable, especially as insurance rates slow.
Gallagher Bassett provides claims management, workers’ compensation solutions, risk consulting, loss-control services and data-driven analytics, allowing AJG to generate revenue from a broader range of risk-management needs beyond traditional insurance brokerage.
AJG is also using technology to deepen this offering. Its Gallagher Blueprint combines AI-driven analytics, proprietary data and specialist expertise to help businesses assess risks and structure insurance programs.
With Risk Management growing at more than twice the organic rate of Brokerage, its rising contribution could help AJG sustain revenue growth even if insurance pricing becomes a smaller growth driver.
What About Its Peers?
Willis Towers Watson Public Limited Company WTW delivered strong momentum in its Risk & Broking business in the second quarter of 2026, with revenues rising 11% year over year to $1.16 billion and organic growth of 7%. Growth was supported by new business, strong client retention and double-digit growth across several specialty businesses.
Aon plc AON’s Commercial Risk Solutions also posted 5% organic growth in the second quarter of 2026, driven by net new business and strong retention. Aon is also expanding its risk-management capabilities through analytics, claims management, cyber solutions, actuarial services and risk consulting.
AJG’s Price Performance
Shares of Arthur J. Gallagher have declined 12.2% in a year compared with the industry’s fall of 14.7%.
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AJG’s Overvaluation
The stock is overvalued compared with its industry. It is currently trading at a price-to-earnings multiple of 18.26, higher than the industry average of 16.18. It currently has a Value Score of D.
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Estimate Movement for AJG
The Zacks Consensus Estimate for AJG’s 2026 earnings per share (EPS) indicates a year-over-year increase of 24.2%.
The consensus estimate for revenues is pegged at $13.3 billion, implying a year-over-year improvement of 20.4%.
The consensus estimate for 2027 EPS and revenues indicates an increase of 12.2% and 8.7%, respectively, from the corresponding 2026 estimates.
The Zacks Consensus Estimate for 2026 and 2027 earnings have moved 0.1% and 0.3% north, respectively, over the last 30 days.
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AJG stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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This article originally published on Zacks Investment Research (zacks.com).
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