AJG vs. ARCC: A Head-to-Head Stock Comparison
Updated onHere’s a clear look at AJG and ARCC, comparing key factors like historical performance, profitability, financial strength, growth, dividend, and valuation.
Company Overview
AJG’s market capitalization of 81.47 billion USD is substantially larger than ARCC’s 15.56 billion USD, indicating a significant difference in their market valuations.
With betas of 0.75 for AJG and 0.73 for ARCC, both stocks show similar sensitivity to overall market movements.
| Symbol | AJG | ARCC |
|---|---|---|
| Company Name | Arthur J. Gallagher & Co. | Ares Capital Corporation |
| Country | US | US |
| Sector | Financial Services | Financial Services |
| Industry | Insurance - Brokers | Asset Management |
| CEO | J. Patrick Gallagher Jr. | Kort Schnabel |
| Price | 318.1 USD | 22.41 USD |
| Market Cap | 81.47 billion USD | 15.56 billion USD |
| Beta | 0.75 | 0.73 |
| Exchange | NYSE | NASDAQ |
| IPO Date | June 20, 1984 | October 5, 2004 |
| ADR | No | No |
Historical Performance
This chart compares the performance of AJG and ARCC by tracking the growth of an initial $10,000 investment in each. Use the tabs to select the desired time period.
Data is adjusted for dividends and splits.
Profitability
Return on Equity
AJG
9.41%
Insurance - Brokers Industry
- Max
- 40.40%
- Q3
- 30.52%
- Median
- 22.48%
- Q1
- 4.38%
- Min
- -5.38%
AJG’s Return on Equity of 9.41% is on par with the norm for the Insurance - Brokers industry, indicating its profitability relative to shareholder equity is typical for the sector.
ARCC
11.03%
Asset Management Industry
- Max
- 34.25%
- Q3
- 18.22%
- Median
- 11.24%
- Q1
- 5.81%
- Min
- -5.72%
ARCC’s Return on Equity of 11.03% is on par with the norm for the Asset Management industry, indicating its profitability relative to shareholder equity is typical for the sector.
Return on Invested Capital
AJG
5.85%
Insurance - Brokers Industry
- Max
- 11.62%
- Q3
- 11.18%
- Median
- 8.38%
- Q1
- 2.57%
- Min
- -1.51%
AJG’s Return on Invested Capital of 5.85% is in line with the norm for the Insurance - Brokers industry, reflecting a standard level of efficiency in generating profits from its capital base.
ARCC
208.60%
Asset Management Industry
- Max
- 42.18%
- Q3
- 20.06%
- Median
- 8.68%
- Q1
- 3.13%
- Min
- -16.42%
ARCC’s Return on Invested Capital of 208.60% is exceptionally high, placing it well beyond the typical range for the Asset Management industry. This demonstrates an outstanding ability to deploy capital efficiently and create significant value.
Net Profit Margin
AJG
12.96%
Insurance - Brokers Industry
- Max
- 21.33%
- Q3
- 15.86%
- Median
- 10.63%
- Q1
- 1.06%
- Min
- -2.28%
AJG’s Net Profit Margin of 12.96% is aligned with the median group of its peers in the Insurance - Brokers industry. This indicates its ability to convert revenue into profit is typical for the sector.
ARCC
67.48%
Asset Management Industry
- Max
- 91.66%
- Q3
- 57.81%
- Median
- 29.48%
- Q1
- 15.70%
- Min
- -27.65%
A Net Profit Margin of 67.48% places ARCC in the upper quartile for the Asset Management industry, signifying strong profitability and more effective cost management than most of its peers.
Operating Profit Margin
AJG
23.06%
Insurance - Brokers Industry
- Max
- 28.73%
- Q3
- 23.24%
- Median
- 21.46%
- Q1
- 10.89%
- Min
- 5.35%
AJG’s Operating Profit Margin of 23.06% is around the midpoint for the Insurance - Brokers industry, indicating that its efficiency in managing core business operations is typical for the sector.
ARCC
91.13%
Asset Management Industry
- Max
- 99.76%
- Q3
- 78.28%
- Median
- 34.76%
- Q1
- 21.75%
- Min
- -48.25%
An Operating Profit Margin of 91.13% places ARCC in the upper quartile for the Asset Management industry. This signals a strong ability to translate revenue into operating profit, outperforming most of its competitors in core business efficiency.
Profitability at a Glance
| Symbol | AJG | ARCC |
|---|---|---|
| Return on Equity (TTM) | 9.41% | 11.03% |
| Return on Assets (TTM) | 2.10% | 5.08% |
| Return on Invested Capital (TTM) | 5.85% | 208.60% |
| Net Profit Margin (TTM) | 12.96% | 67.48% |
| Operating Profit Margin (TTM) | 23.06% | 91.13% |
| Gross Profit Margin (TTM) | 55.08% | 95.92% |
Financial Strength
Current Ratio
AJG
1.44
Insurance - Brokers Industry
- Max
- 1.90
- Q3
- 1.76
- Median
- 1.29
- Q1
- 1.14
- Min
- 1.05
AJG’s Current Ratio of 1.44 aligns with the median group of the Insurance - Brokers industry, indicating that its short-term liquidity is in line with its sector peers.
ARCC
--
Asset Management Industry
- Max
- 12.44
- Q3
- 5.76
- Median
- 3.04
- Q1
- 1.03
- Min
- 0.01
Current Ratio data for ARCC is currently unavailable.
Debt-to-Equity Ratio
AJG
0.04
Insurance - Brokers Industry
- Max
- 4.59
- Q3
- 2.12
- Median
- 0.59
- Q1
- 0.07
- Min
- 0.01
Falling into the lower quartile for the Insurance - Brokers industry, AJG’s Debt-to-Equity Ratio of 0.04 points to a conservative financing strategy. This results in lower financial risk but potentially limits strategic investments compared to more leveraged competitors.
ARCC
--
Asset Management Industry
- Max
- 2.62
- Q3
- 1.42
- Median
- 0.76
- Q1
- 0.34
- Min
- 0.01
Debt-to-Equity Ratio data for ARCC is currently unavailable.
Interest Coverage Ratio
AJG
29.40
Insurance - Brokers Industry
- Max
- 29.40
- Q3
- 16.65
- Median
- 7.25
- Q1
- 4.20
- Min
- 1.60
AJG’s Interest Coverage Ratio of 29.40 is in the upper quartile for the Insurance - Brokers industry, signifying a strong and healthy capacity to meet its interest payments from operating profits.
ARCC
3.77
Asset Management Industry
- Max
- 13.30
- Q3
- 6.30
- Median
- 2.71
- Q1
- 1.00
- Min
- -6.91
ARCC’s Interest Coverage Ratio of 3.77 is positioned comfortably within the norm for the Asset Management industry, indicating a standard and healthy capacity to cover its interest payments.
Financial Strength at a Glance
| Symbol | AJG | ARCC |
|---|---|---|
| Current Ratio (TTM) | 1.44 | -- |
| Quick Ratio (TTM) | 1.44 | -- |
| Debt-to-Equity Ratio (TTM) | 0.04 | -- |
| Debt-to-Asset Ratio (TTM) | 0.01 | -- |
| Net Debt-to-EBITDA Ratio (TTM) | -4.68 | -0.35 |
| Interest Coverage Ratio (TTM) | 29.40 | 3.77 |
Growth
The following charts compare key year-over-year (YoY) growth metrics for AJG and ARCC. These metrics are based on the companies’ annual financial reports.
Revenue Growth
Earnings Per Share (EPS) Growth
Free Cash Flow Growth
Dividend
Dividend Yield
AJG
0.79%
Insurance - Brokers Industry
- Max
- 2.63%
- Q3
- 1.34%
- Median
- 0.79%
- Q1
- 0.00%
- Min
- 0.00%
AJG’s Dividend Yield of 0.79% is consistent with its peers in the Insurance - Brokers industry, providing a dividend return that is standard for its sector.
ARCC
8.57%
Asset Management Industry
- Max
- 26.09%
- Q3
- 11.60%
- Median
- 6.37%
- Q1
- 2.75%
- Min
- 0.00%
ARCC’s Dividend Yield of 8.57% is consistent with its peers in the Asset Management industry, providing a dividend return that is standard for its sector.
Dividend Payout Ratio
AJG
35.97%
Insurance - Brokers Industry
- Max
- 45.22%
- Q3
- 39.19%
- Median
- 29.49%
- Q1
- 3.85%
- Min
- 0.00%
AJG’s Dividend Payout Ratio of 35.97% is within the typical range for the Insurance - Brokers industry, suggesting a balanced approach between shareholder payouts and company reinvestment.
ARCC
81.85%
Asset Management Industry
- Max
- 1,034.88%
- Q3
- 127.70%
- Median
- 75.15%
- Q1
- 34.21%
- Min
- 0.00%
ARCC’s Dividend Payout Ratio of 81.85% is within the typical range for the Asset Management industry, suggesting a balanced approach between shareholder payouts and company reinvestment.
Dividend at a Glance
| Symbol | AJG | ARCC |
|---|---|---|
| Dividend Yield (TTM) | 0.79% | 8.57% |
| Dividend Payout Ratio (TTM) | 35.97% | 81.85% |
Valuation
Price-to-Earnings Ratio
AJG
46.21
Insurance - Brokers Industry
- Max
- 45.50
- Q3
- 35.20
- Median
- 30.00
- Q1
- 28.34
- Min
- 26.42
At 46.21, AJG’s P/E Ratio is exceptionally high, exceeding the typical maximum for the Insurance - Brokers industry. This suggests the stock may be significantly overvalued compared to its peers and implies high market expectations that could be difficult to meet.
ARCC
10.53
Asset Management Industry
- Max
- 38.72
- Q3
- 23.40
- Median
- 11.45
- Q1
- 8.80
- Min
- 1.54
ARCC’s P/E Ratio of 10.53 is within the middle range for the Asset Management industry. This suggests its valuation is in line with the sector average, representing neither a significant premium nor a discount compared to its peers.
Forward P/E to Growth Ratio
AJG
3.32
Insurance - Brokers Industry
- Max
- 3.32
- Q3
- 3.00
- Median
- 2.77
- Q1
- 2.41
- Min
- 2.09
AJG’s Forward PEG Ratio of 3.32 is exceptionally high for the Insurance - Brokers industry. This suggests its stock price is very high relative to its expected earnings growth, signaling significant overvaluation risk.
ARCC
-7.92
Asset Management Industry
- Max
- 6.38
- Q3
- 3.23
- Median
- 1.55
- Q1
- 0.89
- Min
- 0.02
ARCC has a negative Forward PEG Ratio of -7.92. This typically results from negative earnings or forecasts of declining future earnings, making the ratio not meaningful for valuation.
Price-to-Sales Ratio
AJG
6.77
Insurance - Brokers Industry
- Max
- 7.38
- Q3
- 5.34
- Median
- 4.27
- Q1
- 2.32
- Min
- 0.27
AJG’s P/S Ratio of 6.77 is in the upper echelon for the Insurance - Brokers industry. This means the company is valued richly on its revenue stream compared to its peers, suggesting the stock is priced for a high level of future performance.
ARCC
7.30
Asset Management Industry
- Max
- 13.75
- Q3
- 7.92
- Median
- 4.87
- Q1
- 3.51
- Min
- 0.02
ARCC’s P/S Ratio of 7.30 aligns with the market consensus for the Asset Management industry. This suggests its valuation, based on sales, is seen as standard and is on par with its competitors.
Price-to-Book Ratio
AJG
3.23
Insurance - Brokers Industry
- Max
- 10.90
- Q3
- 8.10
- Median
- 6.93
- Q1
- 4.15
- Min
- 1.12
AJG’s P/B Ratio of 3.23 is in the lower quartile for the Insurance - Brokers industry. From a value investing perspective, this is favorable, as it suggests the stock is trading at a discount to its net asset value and may offer a greater margin of safety.
ARCC
1.11
Asset Management Industry
- Max
- 5.33
- Q3
- 2.75
- Median
- 1.06
- Q1
- 0.87
- Min
- 0.00
The P/B Ratio is often not a primary valuation metric for the Asset Management industry.
Valuation at a Glance
| Symbol | AJG | ARCC |
|---|---|---|
| Price-to-Earnings Ratio (P/E, TTM) | 46.21 | 10.53 |
| Forward PEG Ratio (TTM) | 3.32 | -7.92 |
| Price-to-Sales Ratio (P/S, TTM) | 6.77 | 7.30 |
| Price-to-Book Ratio (P/B, TTM) | 3.23 | 1.11 |
| Price-to-Free Cash Flow Ratio (P/FCF, TTM) | 32.26 | -6.47 |
| EV-to-EBITDA (TTM) | 19.36 | 8.15 |
| EV-to-Sales (TTM) | 5.46 | 7.00 |