We recently published a list of Top 10 Stocks to Buy According to Balyasny Asset Management. In this article, we are going to take a look at where Arthur J. Gallagher & Co. (NYSE:AJG) stands against other top stocks to buy according to Balyasny Asset Management.
Balyasny Asset Management (BAM) is a leading investment management firm headquartered in Chicago, with additional offices in Canada, London, and Asia. The firm is dedicated to delivering consistent, uncorrelated returns across various market conditions. By leveraging advanced research, technology, and a diversified investment approach, BAM seeks to identify and capitalize on opportunities in global financial markets. The firm’s core strategies span equities, fixed income, macroeconomic trends, commodities, and systematic investing, all supported by a robust risk management framework tailored to individual portfolio managers and their teams.
The firm’s Quantitative Research division employs an evidence-based, analytical approach to enhance investment performance. By identifying patterns and inefficiencies, the team supports portfolio managers in making data-driven decisions that lead to sustainable returns. BAM’s Applied AI team further strengthens this effort by integrating artificial intelligence tools into daily operations, improving efficiency, and uncovering insights that might otherwise go unnoticed. This collaboration across strategies enhances idea generation while mitigating risks, ensuring that investment decisions are well-informed and adaptive to evolving market conditions.
Balyasny’s investment strategies are diverse, with a strong emphasis on Equities Long/Short (L/S), one of the largest equity platforms among multi-strategy asset managers. The firm employs over 300 analysts and 70 portfolio managers who conduct fundamental, sector-specific research to identify compelling long and short investment opportunities. Its Fixed Income & Macro division capitalizes on global trends through a mix of directional, relative value, and semi-systematic strategies, supported by a team of more than 140 investment professionals across 40 specialist groups. Additionally, the Commodities division focuses on supply and demand-driven investments, leveraging a sophisticated technology and data platform.
Other key investment approaches include Multi-Asset Arbitrage, which targets opportunities in event-driven and arbitrage strategies such as convertibles and credit, and the Systematic division, which uses proprietary technology and quantitative modeling to generate consistent, risk-adjusted returns. BAM’s forward-looking risk management system plays a crucial role in safeguarding investments, adapting to market changes, and ensuring risk is managed effectively across asset classes. By continuously refining its strategies and leveraging cutting-edge technology, Balyasny Asset Management remains a competitive force in the global investment landscape.
Dmitry Balyasny co-founded Balyasny Asset Management (BAM) in 2001 and serves as its Managing Partner and Chief Investment Officer. Under his leadership, BAM has grown into a globally recognized investment firm with a strong presence in equities long/short investing. He plays an active role in risk management and portfolio strategy while overseeing the firm’s expansion across multiple asset classes. Balyasny began his trading career in 1994 with Schonfeld Securities and has been a key figure in the hedge fund industry since 1999. His expertise in identifying overlooked investment opportunities has been instrumental in BAM’s success, emphasizing a research-driven approach to uncovering unique, high-return strategies.
Beyond his work in finance, Balyasny is deeply committed to philanthropy and education. In 2021, he founded ATLAS Fellows, Inc., a nonprofit dedicated to providing under-resourced young individuals with opportunities for careers in finance and investing. Additionally, he actively supports the Ayn Rand Institute and various educational initiatives aimed at fostering intellectual and professional development. As a board member for Teach for America Chicago, he contributes to advancing educational equity and supporting community engagement programs.
Balyasny holds a Bachelor of Business Administration in Finance from Loyola University Chicago. His philosophy in investing is centered on focusing on “misunderstood situations,” leveraging in-depth research to uncover opportunities others may overlook. This contrarian yet disciplined approach has solidified his reputation as a leading figure in the investment industry.
Once an unknown name in the financial sector, Dmitry Balyasny has since risen to prominence as one of the industry’s top investors. His ability to navigate complex markets and adapt to changing economic conditions has made him a respected voice in the hedge fund world. Through his leadership at BAM and his philanthropic efforts, he continues to influence both the financial and educational landscapes, leaving a lasting impact on the industry and beyond.
As of its latest filing for the fourth quarter of 2024, Balyasny Asset Management oversees approximately $67.14 billion in 13F securities. The firm maintains a well-diversified portfolio, with its top ten holdings representing just 6.13% of total assets, reflecting a balanced investment approach that mitigates risk while capitalizing on strategic opportunities.
Our Methodology
The stocks discussed below were picked from Balyasny Asset Management’s Q4 2024 13F filings. They are compiled in the ascending order of the hedge fund’s stake in them as of December 31, 2024. To assist readers with more context, we have included the hedge fund sentiment regarding each stock using data from 1009 hedge funds tracked by Insider Monkey in the fourth quarter of 2024.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
An insurance broker talking to a client, demonstrating the trust of their services.
Arthur J. Gallagher & Co. (NYSE:AJG)
Number of Hedge Fund Holders as of Q4: 77
Balyasny Asset Management’s Equity Stake: $374.51 Million
Arthur J. Gallagher & Co. (NYSE:AJG) is a leading American insurance brokerage and risk management firm headquartered in Rolling Meadows, Illinois. Established in 1927, the company has grown into one of the largest insurance brokers globally, with over 56,000 employees providing services in more than 130 countries.
In the fourth quarter of 2024, Arthur J. Gallagher & Co. (NYSE:AJG) reported total revenue of $2.68 billion, slightly below analysts’ expectations of $2.69 billion. However, the company’s adjusted net earnings surged to $491.2 million, a significant increase from $402.4 million in the prior year. Adjusted earnings per share (EPS) reached $2.13, exceeding projections of $1.35. This impressive financial performance underscores the company’s resilience and ability to maintain profitability despite acquisition-related costs and workforce adjustments. The brokerage segment saw a 12% year-over-year revenue increase to $2.3 billion, while the risk management division experienced steady growth, reaching $369.4 million.
Arthur J. Gallagher & Co. (NYSE:AJG) continued its aggressive expansion strategy by completing 20 acquisitions in Q4 2024, adding an estimated annualized revenue of $387 million. Chairman and CEO J. Patrick Gallagher, Jr. highlighted the firm’s remarkable success, marking its 16th consecutive quarter of double-digit revenue growth, with organic revenue increasing by 7%. With a solid balance sheet and a clear focus on expansion, Arthur J. Gallagher & Co. (NYSE:AJG) remains well-positioned for continued success in the competitive insurance brokerage industry.
Investor confidence in the company is evident, as hedge funds have significantly increased their holdings in Arthur J. Gallagher & Co. By the end of Q4 2024, Balyasny Asset Management raised its stake in the company to nearly 1.32 million shares, a massive increase from just 2,478 shares in the previous quarter, bringing its investment value to approximately $374.54 million. Additionally, data from Insider Monkey reveals that 77 hedge funds held positions in the company by the end of Q4, up from 44 in the prior quarter, with total stakes valued at nearly $4.47 billion. These investment trends indicate strong institutional confidence in Arthur J. Gallagher & Co. (NYSE:AJG)’s growth potential.
Andvari Associates stated the following regarding Arthur J. Gallagher & Co. (NYSE:AJG) in its Q3 2024 investor letter:
“Arthur J. Gallagher & Co. (NYSE:AJG) and Rollins are two other serial acquirers in Andvari’s client portfolios. Both are some of the largest, and best, businesses in their respective industries. AJG is a leading property and casualty insurance and reinsurance broker. Rollins is home to many of the top brands in the pest service industry in North America.
Importantly, while both AJG and Rollins have large market shares, their respective markets are still highly fragmented. There are thousands of small and medium-sized businesses left for AJG and Rollins to acquire. Gallagher currently has a pipeline of 100 potential acquisitions that represents about $1.4 billion of annualized revenue (compare this to $10.1 billion of revenues for 2023). Andvari believes the pace of acquisitions for both companies can continue for many years to come. Just see below the acquisition track records of both companies since 2014…”(Click here to read the full text)
Overall, AJG ranks 6th on our list of top stocks to buy according to Balyasny Asset Management. While we acknowledge the potential for AJG as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than AJG but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
