Patrick Gallagher, COO of Arthur J. Gallagher & Co. (AJG), recently bought 1,115 shares. The buy increased his stake by 1%, and came to a total cost of $316,814.
This marks the first insider buy at the company over the past two years. Otherwise, company insiders have been sellers, about evenly mixed between outright sales and sales following the exercise of stock options. The largest sale came from the CFO in August 2023, amounting to $15 million.
Overall, Arthur J. Gallagher insiders own 1.0% of shares.
The insurance provider is up about 29% over the past year, about in-line with the overall market. AJG has been active in buying a number of smaller insurance agencies over the past year.
Operationally, the business has been reasonable, with both earnings and revenues up about 12% over the past year. The insurance space isn’t structured for high growth, but AJG is holding up well with an 11% profit margin.
Action to take: AJG shares are in a long-term uptrend, and recently pulled back from their 52-week highs, offering a reasonable entry price here. The insurance industry likely has further room to consolidate in the years ahead.
AJG also pays a 0.9% dividend at current prices.
For traders, the momentum higher is likely to continue. The April 2025 $320 calls, last trading for about $3.40, are fairly actively traded, and could see mid-double-digit returns or better on a rally into next spring.
Disclosure: The author of this article has no position in the company mentioned here, but may trade after the next 72 hours. The author receives no compensation from any company mentioned in this article.