Arthur J. Gallagher (AJG) PT Raised to $308 at KBW on Woodruff Sawyer Acquisition

Keefe, Bruyette & Woods analyst Meyer Shields raised the price target on Arthur J. Gallagher (NYSE: AJG) to $308.00 (from $295.00) while maintaining a Market Perform rating.

The analyst commented: "Raising EPS and TP on Woodruff Sawyer Acquisition; On Tuesday afternoon, AJG announced that it is buying San Francisco-based broker Woodruff Sawyer for $1.2 billion, or 13.6x its TTM EBITDAC of $88 million (including AJG estimated synergies), with an expected 2Q25 close. We don't view the price as unduly expensive, although it is above the 11.3x adjusted EBITDAC that AJG disclosed for its pending AssuredPartners acquisition. We raise our 2025E/2026E cash EPS to $11.65/$13.55 from $11.60/$13.45, mostly reflecting higher acquired growth and slightly higher fiduciary income, partly offset by higher interest and banking expenses. We raise our target price to $308 (22.7x our updated 2026E cash EPS) from $295 and maintain our Market Perform Rating."

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