What Happened?
Shares of insurance brokerage firm Arthur J. Gallagher (NYSE: AJG) fell 4.7% in the afternoon session after a U.S. government proposal for nearly flat Medicare payment rates in 2027 dragged down health insurer stocks.
The Centers for Medicare & Medicaid Services outlined a proposal to raise payment rates for private Medicare Advantage plans by only 0.09% for 2027. This figure fell far short of what Wall Street expected, triggering a broad sell-off across the industry. Major insurers like Humana, UnitedHealth, and CVS Health saw their shares fall sharply. Arthur J. Gallagher, which offers and shops for Medicare-related products including Medicare Advantage plans, was caught in the downturn as investor concern spread across the sector.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Is now the time to buy Arthur J. Gallagher? Access our full analysis report here, it’s free.
What Is The Market Telling Us
Arthur J. Gallagher’s shares are not very volatile and have only had 3 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.
Arthur J. Gallagher is down 5.1% since the beginning of the year, and at $242.98 per share, it is trading 30.3% below its 52-week high of $348.77 from June 2025. Investors who bought $1,000 worth of Arthur J. Gallagher’s shares 5 years ago would now be looking at an investment worth $2,148.
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