Arthur J. Gallagher (Arthur J. Gallagher) Graham Number

: $N/A (As of Dec. 2023)

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Graham Number is a figure that measures a stock's fundamental value by taking into account the company's earnings per share and book value per share. The Graham number is the upper bound of the price range that a defensive investor should pay for the stock. According to the theory, any stock price below the Graham number is considered undervalued, and thus worth investing in.

As of today (2024-04-20), the stock price of Arthur J. Gallagher is $236.57. Arthur J. Gallagher's graham number for the quarter that ended in Dec. 2023 was $N/A. Therefore, Arthur J. Gallagher's Price to Graham Number ratio for today is N/A.

The historical rank and industry rank for Arthur J. Gallagher's Graham Number or its related term are showing as below:

AJG's Price-to-Graham-Number is not ranked ^*
in the Insurance industry.
Industry Median: 0.86
* Ranked among companies with meaningful Price-to-Graham-Number only.

Graham Number is a combination of asset valuation and earnings power valuation. It is a very conservative way of valuing a stock.

Arthur J. Gallagher Graham Number Historical Data

The historical data trend for Arthur J. Gallagher's Graham Number can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* Premium members only.

Arthur J. Gallagher Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Graham Number

Arthur J. Gallagher Quarterly Data
	Mar19	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23
Graham Number																-	-	-	-	-

Competitive Comparison

For the Insurance Brokers subindustry, Arthur J. Gallagher's Price-to-Graham-Number, along with its competitors' market caps and Price-to-Graham-Number data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

Arthur J. Gallagher Price-to-Graham-Number Distribution

For the Insurance industry and Financial Services sector, Arthur J. Gallagher's Price-to-Graham-Number distribution charts can be found below:

* The bar in red indicates where Arthur J. Gallagher's Price-to-Graham-Number falls into.

Arthur J. Gallagher Graham Number Calculation

Graham Number is a concept based on Ben Graham's conservative valuation of companies.

Arthur J. Gallagher's Graham Number for the fiscal year that ended in Dec. 2023 is calculated as

	Graham Number
=	sqrt of (22.5	*	Tangible Book per Share	*	EPS without NRI)
=	sqrt of (22.5	*	-24.613	*	8.76)
=	N/A

Arthur J. Gallagher's Graham Number for the quarter that ended in Dec. 2023 is calculated as

	Graham Number
=	sqrt of (22.5	*	Tangible Book per Share	*	EPS without NRI (TTM))
=	sqrt of (22.5	*	-24.613	*	8.77)
=	N/A

Arthur J. Gallagher (NYSE:AJG) Graham Number Explanation

Ben Graham actually did not publish a formula like this. But he wrote in The Intelligent Investor (1948 version) regarding to the criteria for purchases:

Current price should not be more than 15 times average earnings of the past three years.

Current price should not be more than 1.5 times the book value last reported. However, a multiplier of earnings below 15 could justify a correspondingly higher multiplier of assets. As a rule of thumb we suggest that the product of the multiplier times the ratio of price to book value should not exceed 22.5. (This figure corresponds to 15 times earnings and 1.5 times book value. It would admit an issue selling at only 9 times earnings and 2.5 times asset value, etc.)

Unlike valuation methods such as DCF or Discounted Earnings, the Graham number does not take growth into the valuation. Unlike the valuation methods based on book value alone, it takes into account the earnings power. Therefore, the Graham Number is a combination of asset valuation and earnings power valuation.

In general, the Graham number is a very conservative way of valuing a stock. It cannot be applied to companies with negative book values.

Arthur J. Gallagher's Price to Graham number Ratio for today is calculated as

Price to Graham number	=	Share Price (Today)	/	Graham number (Q: Dec. 2023 )
	=	236.57	/	N/A
	=	N/A

Be Aware

Please keep these in mind:

1. Graham Number does not take growth into account. Therefore it underestimates the values of the companies that have good earnings growth. We feel that if the earnings per share grows more than 10% a year, Graham Number underestimates the value.
2. Graham Number punishes the companies that have temporarily low earnings. Therefore, an average of earnings makes more sense in the calculation of Graham Number.
3. Graham Numbers underestimates companies that are light with book.

Arthur J. Gallagher Graham Number Related Terms

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Arthur J. Gallagher (Arthur J. Gallagher) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Financial Services » Insurance » Arthur J. Gallagher & Co (NYSE:AJG) » Definitions » Graham Number

Comparable Companies

Traded in Other Exchanges

AJG:Mexico GAH:Germany GAH:Germany

Address

2850 Golf Road, Rolling Meadows, IL, USA, 60008-4050

Website

https://investor.ajg.com

Arthur J. Gallagher & Co provides insurance brokerage and consulting services to middle-market entities around the world. The majority of the company's revenue comes from its brokerage segment, where it negotiates and places its customers with insurance companies that provide, among other types, property/casualty and health insurance. The company's primary source of revenue in the brokerage segment is commissioning from the insurance companies. The company also generates significant revenue in its corporate segment, which includes clean energy investment and other investment income. The company generates most of its revenue in the United States, with the remaining revenue coming primarily from Australia, Bermuda, Canada, the Caribbean, New Zealand, and the United Kingdom.

Executives

Douglas K Howell	officer: Vice President and Chief	ARTHUR J. GALLAGHER & CO., TWO PIERCE PLACE, ITASCA IL 60143
William F Ziebell	officer: VICE PRESIDENT	2 PIERCE PLACE, ITASCA IL 60143
Christopher E Mead	officer: VICE PRESIDENT	2850 GOLF ROAD, ROLLING MEADOWS IL 60008
Joel D Cavaness	officer: Vice President	2 PIERCE PLACE, ITASCA IL 60143
David S Johnson	director	C/O ARTHUR J. GALLAGHER & CO., TWO PIERCE PLACE, ITASCA IL 60143
Walter D. Bay	officer: VICE PRESIDENT, SECRETARY AND	1011 ELM STREET, WINNETKA IL 60093
Richard C Cary	officer: Controller	C/O ARTHUR J. GALLAGHER & CO., TWO PIERCE PLACE, ITASCA IL 60143
Sherry S Barrat	director	C/O NEXTERA ENERGY, INC., 700 UNIVERSE BLVD, JUNO BEACH FL 33408
Susan E Mcgrath	other: Vice President	C/O ARTHUR J. GALLAGHER & CO., TWO PIERCE PLACE, ITASCA IL 60143
Kay W Mccurdy	director	C/O ARTHUR J. GALLAGHER & CO., TWO PIERCE PLACE, ITASCA IL 60143
Patrick Murphy Gallagher	officer: Vice President	2850 GOLF ROAD, ROLLING MEADOWS IL 60008
Scott R Hudson	officer: CORPORATE VP	C/O ARTHUR J. GALLAGHER & CO., TWO PIERCE PLACE, ITASCA IL 60143
William L Bax	director	TWO PIERCE PLACE, C/O ARTHUR J. GALLAGHER & CO., ITASCA IL 60143
Mark H. Bloom	officer: Vice President	8200 JONES BRANCH DRIVE, MCLEAN VA 22102
Gallagher J Patrick Jr	director, officer: President & CEO	C/O ARTHUR J. GALLAGHER & CO., TWO PIERCE PLACE, ITASCA IL 60143