Daily Brief United States: Arthur J Gallagher & Co, Marsh & Mclennan, Mfa Financial and more

Key points

• Arthur J Gallagher is a strong player in the U.S. SME broking market trading at fair value with potential upside
• Estimated 5-year returns are 10% IRR / 1.5x MOIC, with possibility of higher returns with EBITDA growth and multiple expansion
• Insurance brokers benefiting from firm P&C pricing cycle and market conditions, providing downside protection and potential for sustained organic growth, investor focus on growth trend maintenance

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

Key points

• Marsh McLennan is the largest insurance broker globally, with strong organic growth driven by its consulting business
• Current valuation at $198 with an EV/2024E EBITDA of 16.0x is considered fair, offering potential 5-year returns of 12% IRR / 1.7x MOIC
• Predicted returns could increase to 16% IRR / 2.1x MOIC with a 13% EBITDA growth rate and a multiple expansion to 17.0x, with a favorable market backdrop for insurance brokers helping to drive growth trends

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

Key points

• MFA Financial’s Series C preferred stock offers a 25% IRR and 40% total return over 18 months
• Favorable entry point for investors due to current interest rate environment and preferred instruments being out of favor
• MFA’s position in the face of LIBOR transition challenges sets it apart, making it a strong choice for short-duration fixed income investing

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.