Arthur J. Gallagher (Arthur J. Gallagher) Debt-to-EBITDA

: 11.20 (As of Dec. 2023)

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Debt-to-EBITDA measures a company's ability to pay off its debt.

Arthur J. Gallagher's Short-Term Debt & Capital Lease Obligation for the quarter that ended in Dec. 2023 was $959 Mil. Arthur J. Gallagher's Long-Term Debt & Capital Lease Obligation for the quarter that ended in Dec. 2023 was $7,358 Mil. Arthur J. Gallagher's annualized EBITDA for the quarter that ended in Dec. 2023 was $743 Mil. Arthur J. Gallagher's annualized Debt-to-EBITDA for the quarter that ended in Dec. 2023 was 11.20.

A high Debt-to-EBITDA ratio generally means that a company may spend more time to paying off its debt. According to Joel Tillinghast's BIG MONEY THINKS SMALL: Biases, Blind Spots, and Smarter Investing, a ratio of Debt-to-EBITDA exceeding four is usually considered scary unless tangible assets cover the debt.

The historical rank and industry rank for Arthur J. Gallagher's Debt-to-EBITDA or its related term are showing as below:

AJG' s Debt-to-EBITDA Range Over the Past 10 Years
Min: 2.94 Med: 3.59 Max: 3.86
Current: 3.82

During the past 13 years, the highest Debt-to-EBITDA Ratio of Arthur J. Gallagher was 3.86. The lowest was 2.94. And the median was 3.59.

AJG's Debt-to-EBITDA is ranked worse than
80.76% of 291 companies
in the Insurance industry
Industry Median: 1.49 vs AJG: 3.82

Arthur J. Gallagher Debt-to-EBITDA Historical Data

The historical data trend for Arthur J. Gallagher's Debt-to-EBITDA 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

Debt-to-EBITDA

Get a 7-Day Free Trial

3.86

2.99

3.73

2.94

3.82

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
Debt-to-EBITDA	Get a 7-Day Free Trial															4.72	2.15	3.39	2.90	11.20

Competitive Comparison

For the Insurance Brokers subindustry, Arthur J. Gallagher's Debt-to-EBITDA, along with its competitors' market caps and Debt-to-EBITDA 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 Debt-to-EBITDA Distribution

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

* The bar in red indicates where Arthur J. Gallagher's Debt-to-EBITDA falls into.

Arthur J. Gallagher Debt-to-EBITDA Calculation

Debt-to-EBITDA measures a company's ability to pay off its debt.

Arthur J. Gallagher's Debt-to-EBITDA for the fiscal year that ended in Dec. 2023 is calculated as

Debt-to-EBITDA	=	Total Debt			/	EBITDA
	=	(Short-Term Debt & Capital Lease Obligation	+	Long-Term Debt & Capital Lease Obligation)	/	EBITDA
	=	(959	+	7358.2)	/	2178.3
	=	3.82

Arthur J. Gallagher's annualized Debt-to-EBITDA for the quarter that ended in Dec. 2023 is calculated as

Debt-to-EBITDA	=	Total Debt			/	EBITDA
	=	(Short-Term Debt & Capital Lease Obligation	+	Long-Term Debt & Capital Lease Obligation)	/	EBITDA
	=	(959	+	7358.2)	/	742.8
	=	11.20

In the calculation of annual Debt-to-EBITDA, the EBITDA of the last fiscal year is used. In calculating the annualized quarterly data, the EBITDA data used here is four times the quarterly (Dec. 2023) EBITDA data.

Arthur J. Gallagher (NYSE:AJG) Debt-to-EBITDA Explanation

In the calculation of Debt-to-EBITDA, we use the total of Short-Term Debt & Capital Lease Obligation and Long-Term Debt & Capital Lease Obligation divided by EBITDA. In some calculations, Total Liabilities is used to for calculation.

Be Aware

A high Debt-to-EBITDA ratio generally means that a company may spend more time to paying off its debt.

According to Joel Tillinghast's BIG MONEY THINKS SMALL: Biases, Blind Spots, and Smarter Investing, a ratio of Debt-to-EBITDA exceeding four is usually considered scary unless tangible assets cover the debt.

Arthur J. Gallagher Debt-to-EBITDA Related Terms

Thank you for viewing the detailed overview of Arthur J. Gallagher's Debt-to-EBITDA provided by GuruFocus.com. Please click on the following links to see related term pages.

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

Industry

GURUFOCUS.COM » STOCK LIST » Financial Services » Insurance » Arthur J. Gallagher & Co (NYSE:AJG) » Definitions » Debt-to-EBITDA

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