dealraker

schin, I just sort of stay the course of watching stuff that I believe is long term sustainable and buy when the stocks show what I think is meaningful weakness. So I have several hundred thousands of ICE but bought recently. I didn't put any homework in updating my research or whatnot, I just bought following through with my monkey see (profits and sustainable) monkey do. 400 shares added at $151.28 on 10/30/2025. My model is buy good business, I don't obsess over seeking lower-lowest PE or such, I never buy the cheap and good businesses to me are ALWAYS worth a PE of 20. When I bought ICE I looked around, none of the others seemed a good buy to me. I haven't looked since. WELLSTRADE IRA *6385 10/30/2025 400 @ $151.28 $160.56

The problem with Trump even further is that he could have as a huge inheritor - he could have invested in US business but instead has spent 60 years mostly floundering while scamming. He's roughly 8 years older than me his $400 mil inheritance should have been $100 bil. But he's out selling meme shit while bitching about Biden. If the worthless MF had been a shareholder like us instead of a scummer-scammer he'd have much better thoughts about Obama/Biden/Bush/Clinton or whoever- hell the markets went through the damn roof. Yet he didn't, he spent his time bullying tax departments, bankers, while selling worthless education. Now he's not out touting his GE investments or his Nvidia...the scumbag is banking meme profits while getting on TV to talk about a man that basically nobody much cared about while he was President and absolutely nobody's thinking about today.

Gotta go with what sells, and when it sells. Back and forth from the euphoria via lining up the tech boys on TV to way-too-soon gloom-and-doom - the crybaby grievance/blame of wounded whites last night on TV? Both sell well when they are marketed and the audience is so limited in their now Fox distorted reality that trying to connect the dots is impossible and a plain stupid thing to expect. Low class, low processing, low level delivery of nothing at all - that's the Trump way. Meanwhile the royal family is getting rich selling scams and the big V is a grand delusional distraction. It's really too bad that Reds and Greg have chosen to go to the "cloud" of such a below grade level support of the Donald. The two of them are so capable of entertaining us beyond belief with their lambasting of the total fucking fake world of the world's greatest and worthless goofball.

I own most all the exchanges for some time, CME and NDAQ for over 20, ICE for 15 or so--- and others. When I post about them others keep stating that they aren't as good a business as in the past and whatnot- or they buy them and then sell on the "pop" and such. I just hold the stocks. Muti-baggers on top of multibalggers. Call me sleepy Joe, I'm just going to sleep with them in my bed with me. Others are obsessed with beating Mr. Market. Me? Just give me a good business...I'll be happy to own it.

Uhh...mainstream media? That's Fox and has been now for some time.

That must be a Trumpanion definition of "balance!"

An agenda that is so obvious and (unlike Trump) so consistent that it makes all posts redundant? Hmm...wonder who posts such? Only Trump can get neighbors and fellow posters to assault one another on his behalf. With the same results, same outcome, some feel endlessly empowered while others feel great loss. Which is it?

Hmm...I'd go a bit different path and say that a more logical constructive conversation would be towards the power that an intermittent, unpredictable, and illogical force like Donnie J can have on those with a tendency for addiction...read Cubs. What surprises me is that guys like Reds and Greg, so accurate in their "call-outs" with so many... ...go dead silent on Donnie J! This, to me, shows the power of such forces. Robert Cialdini's book INFLUENCE...oh yeah! Trump and Saylor! Addict the world to the most productive mind-set in history! Crypto!!!!!!!!!!!!!! Having fun this a.m.

AJ Gallagher had a detailed conference call yesterday for those interested.

I would state that my reply was objecting to the pretense of Greg's post.

Really? I didn't vote Republican so I think you and Cubs are Nazi/fascist? Really? How about I didn't vote Republican because I think Donald Trump is a worthless piece of fucking fake shit?

Yes.

I listened to these on AJG and BRO as I walked a on a couple of days. Yes largely AI but in many ways a good primer. But oh my, as to earnings and valuation they are taking an accuracy pass.

Amen LC. Over the years the glaring void to ignorance of the insurance broker business has been obvious. Wells was the first to put some real effort into grasping this business and for years the only source of bare minimal analysis. Many large investment firms often meshed brokers and underwriters together. Interestingly my long long established investment club, established in 1954 with two members many on this forum would know by name, had three broker owners as members out of 25. Yet any bring up of brokers was always met with resounding negativity as to how volatile and unpredictable the insurance business was, thus not investing. Even the broker owners, guys getting feverishly wealthy, knew little as to the big roll up firms. I'm not an over confident investor, AJG just made a whopping large deal and BRO basically went outside their model with the most recent big deal. So there is uncertainty in the air, stocks are falling and cut-'n-run is in play. Rates may be soft...but don't forget to check history for decades of soft affect on broker success. To me the broker business is one a 5th grader should be able to reasonably assess, yet so many freak out asking questions that seem strange to me, the answers so obvious. What's the case for the brokers today? Hell, go find your agent and grab a beer. I'm sure he will be willing to pay the tab and if you get him drunk he will spill the beans. I was a builder for decades and for about ten years I co owned an insurance business. Those working in the insurance business cruised through economic downturn and for agents and brokers it was party time. Builders flirted with bankruptcy!

The only possible way to get a decent entry price for AJG or most any stock is the above scenario. AJG is an extremely "untimely" stock of a historically beast of a business. The brokers had a lengthy battle with the NY Attorney General Eliot Spitzer (of Heidi Fleiss notoriety) as to contingency commissions in the early 2000's and in 2015 AJG plummeted to 15 times next years earnings. Relative to the market today is the cheapest the brokers have been since those two episodes. Are they still great businesses? Will they prevail to outperform over the long term?

Interesting posts here on AJG! Facts or fiction? LOL. My facts, which may differ from your facts. AJG was not downgraded by Wells. AJG sells at a significant discount to the market and an average multiple for the brokers. Lastly, with nearly 15 years of broker coverage not once ever has Wells had a 40% upside in a broker price as they do for AJG.

Across the street from my lake house my nephew and I bought 25 acres a couple years ago. Next to this is 450 acres that sold in November this year to a couple entities, one being VennTerra a prolific developer in our area. We knew all this was coming as there is ongoing endless massive development both commercial and residential relative to the size and current population of the Lexington, NC area. We are hoping for a nice grocery store a bit closer to the ones 8 miles away. But...uhh...chances are we'll probably get yet another Dolla General instead...and only maybe a slightly more upscale shopping experience. There are so many DG's going up it boggles the mind. Ya think they are focused on the "stand alone in the rural" theme? Dream on. These things are popping up within sight of WalMart. Density is clearly the new model. I'm skeptical. But I've bought many a stock I was skeptical about. Not the brightest bulb in the store, sometimes it is for me monkey see- monkey do level analysis.

Dang...our Trumper ecco chamber is in full bloom! Yawl buy the Dolla General like I told you to?

Podcast: https://www.sicafletcher.com/gallagher-assured-deal-podcast

From Sika Fletcher: Overview The insurance brokerage industry looks very different from how it looked in 2000 when half of the 10 largest brokers in the U.S. were publicly traded and the private equity world didn’t know insurance brokers even existed. A consistent and sustained trend in this fragmented industry for decades has certainly been consolidation, which has led to the creation of some of the world’s largest and most diverse insurance brokers. From 2000–2010, highly acquisitive public brokers such as Arthur J. Gallagher (NYSE: AJG), Brown & Brown (NYSE: BRO) and Aon PLC (NYSE: AON) accounted for the majority of broker acquisitions aided by their well-oiled M&A machinery and ready access to capital. As these firms were amassing their global brokerage empires, private equity sponsors entered the brokerage scene around 2007, and by 2014, essentially dominated the M&A landscape having completed thousands of transactions worth billions in the aggregate. Sica | Fletcher’s 2024 Index shows that private-equity–backed brokers accounted for 88% of all announced deals, with public brokers and other buyer types making up the remainder. In December 2024, publicly-traded AJG announced its acquisition of private-equity–backed AssuredPartners for $13.45 billion – the largest acquisition to date of a PE-backed broker by a publicly-traded broker and barely surpassing Aon’s 2024 acquisition of NFP, valued at $13.4 billion. In light of the recent trend of these mega-unions where PE-backed brokers are being consumed by their publicly-traded counterparts, in March of this year, Sica | Fletcher published an article about the AJG/Assured transaction and asked a fundamental question: Is this the beginning of the empire striking back where strategics begin to reclaim their historical M&A dominance and market share from PE-backed investors? So far, the answer has been a resounding yes. On August 1, barely eight months after AJG announced its intent to acquire Assured, Brown & Brown, the seventh-largest U.S. insurance broker, announced that it would acquire the 14th-largest, Risk Strategies (RSC) underscoring our thesis that the publicly traded brokers will continue to supplant private equity firms as the dominant force in this industry. At the time of the announcement, RSC reported revenue of $1.7 billion and pro forma EBITDA of $600 million which produced a $9.8 billion valuation. It was widely reported that Risk Strategies had been actively exploring strategic options for much of 2024 and many industry insiders speculated that RSC would recapitalize with a new PE investor. At one point, it was reported that RSC was close to a deal with London-based Howden, which sought a U.S. retail presence and would have been a compelling strategic fit. The transaction, however, surprisingly collapsed as a result of several purported due diligence issues that could not be adequately resolved. Many, including some RSC insiders, were equally surprised when just a few months later Brown stepped in and acquired RSC. On the Sica | Fletcher Leaders & Legends podcast, Mike Christian, Chairman & Founder of RSC, when responding to a question about selling RSC to a publicly traded broker, he stated clearly, “That would’ve been the last thing I would’ve thought about.” Despite the initial shock, we believe RSC shareholders will come to view this deal favorably outcome, and since approximately 38% of RSC’s 200+ completed transactions in the past five years were Sica | Fletcher clients, we can express this opinion with some confidence. Given RSC’s scale, specialty focus and our deep knowledge of the firm, we believe many shareholders expected an 18.0x multiple and preferred a recap with another PE sponsor that would have enabled it to stay out of the publicly traded realm. But in today’s interest-rate environment, math makes that difficult. Why? PE limited partners (LPs) typically expect at least 15.0% returns before allocating capital to any fund. Given industry average fund management fees (2.0% plus a 20.0% carry), PE funds generally need 20.0%+ gross returns to satisfy LP expectations. Over the past decade, however, PE firms relied on multiple expansion and arbitrage, cheap and abundant leverage and heavy M&A activity in order to deliver those returns. That recipe produced spectacular and unprecedented results but will be harder to consistently replicate going forward. Would RSC Have Been Better Off Forgoing Optionality? Given these hurdles, we posed another fundamental question: Would RSC have been better off forgoing optionality and recapitalizing with another private equity firm, rinsing and repeating the same M&A program and then reselling in another five years? We don’t believe so. The chart below compares expected returns for a hypothetical PE investor acquiring RSC under two valuation scenarios of 16.3x and 18.0x vs. Brown’s actual deal at 16.3x and fundamentally takes RSC out of the acquisition arena - a key element of its growth and expansion over the past decade. In the 18.0x scenario, a PE investor should expect an approximately 9.6% levered return and at 16.3x, an approximately 10.1% return. In our Expected Return analysis, we did not assume any add-on acquisitions, which would raise returns for any acquirer. The issue is RSC’s size: at $600 million of EBITDA, generating meaningful uplift in returns purely through add-ons is more difficult than it would be for, say, a $200–$300 million EBITDA platform, i.e., moving the needle via acquisitions simply gets more challenging the larger the buyer becomes. We would argue a smaller RSC might well have attracted a PE investor at 16.0x. In the 16.3x scenario, a 10.1% expected return on the RSC deal for a private equity investor would have meant continued reliance on significant M&A activity to boost returns. After fees, LPs could be left with returns as low as 5% assuming RSC isn’t able to generate material future add-on activity. WHY BROWN'S RETURNS LOOK MORE ATTRACTIVE Brown’s expected levered return is approximately 12.9%, which assumes no incremental returns from M&A add-ons. Brown can achieve this more attractive return largely through transaction synergies (estimated at $150 million of EBITDA) and favorable borrowing terms to partially fund the transaction (roughly $4.0 billion at about 5.3%). Most importantly, Brown does not face PE’s fee-driven return hurdles. Finally, expected returns aside, RSC shareholders should recognize that liquidity – i.e., bankable proceeds today – matters. Many announced deals tout headline multiples and valuations but offer limited near-term liquidity for the equity portion of consideration. In Brown’s acquisition, RSC shareholders received an 86%/14% cash/stock mix. Although the Brown stock is restricted, or “locked up”, for 2–5 years depending on certain scenarios, at least there is a clear and enforceable liquidity path for the equity portion of consideration. To be fair, equity provided in PE deals also provides eventual liquidity, but the timing of recapitalizations is uncertain and there are usually restrictions on how much can be monetized during a recap. From a timing perspective, things could not have been worse. To take a company private requires the buyer to pay a significant premium over the current market price of the stock. So not only did Goldman and Apax have to pay a premium, but they paid a premium at the top of the 2007 stock market, just before the market fell by 53% in the largest financial crisis to take place since the Great Depression. So how did those deals turn out for investors? Despite these headwinds, the returns proved impressive. USI reportedly generated 2.5x returns over five years and HUB generated 3.5x returns over five years. For lenders, the test case of lending to insurance brokers with no real assets in a challenging environment proved lucrative. These two deals would set the stage for what was to come next. Expected Returns - Brown & Brown/RSC Our Expected Return model estimates “ballpark” returns from a general investor perspective rather than forecasting returns for a specific investor. Institutional investors typically use IRR, ROIC, CAPM and other models, which are investor specific. Sica | Fletcher built its model on the framework of AQR’s expected-return model for private assets1, swapping inputs to enable transaction-level views in our industry. First and foremost, we note that each input is variable, and changes can materially affect the final output. We begin the unlevered Expected Return calculation with the inverse of the EBITDA multiple to derive an EBITDA Yield (EY). We then reduce that yield by 25% as a proxy for Free Cash Flow (FCF) Yield, which accounts for CAPEX, taxes and other outflows. We believe this 25% assumption is a conservative baseline as brokers generally need little in terms of capital expenditures. We then add expected growth (G) to the FCF Yield to arrive at our Expected Return (ER), apply leverage and its corresponding Cost of Debt (CD) based on the Secured Overnight Financing Rate (SOFR) plus a market standard spread, and finally, add expected Multiple Expansion (ME), which we assume to be zero in our analysis, to compute our Expected Return (Levered), or ERL. Conclusion Our conclusion is that Brown’s acquisition of RSC at 16.3x was a shareholder win with an Expected Return (Levered) of 12.9% stemming, in part, from the impact of material transaction-related synergies and an overall lower cost of debt. As other PE-backed brokers approach the scale of RSC and AssuredPartners in the coming years, their future exit options will increasingly – and necessarily – include the publicly-traded “empires” that can realize material synergies and deliver compelling economics to shareholders without private equity’s liquidity and return constraints. It’s taken nearly two decades, but the empire has indeed struck back and the next wave of PE-backed broker ownership changes, whether involving an IPO, a recapitalization with other private equity firm or a sale to one of the handful of publicly traded firms, will continue to dramatically shape this ever-evolving industry. Want to hear Managing Partner Mike Fletcher's take on this deal? Check out this episode of our Navigating the Deal podcast.

https://www.sicafletcher.com/_files/ugd/183b46_e06832d7e3404b679521425ed3f48574.pdf AJG_Case_Study.pdf

Cubs-Cubs-Cubs --- only if you are attracted to rage bait. Those black women...you know without brain processing power not to be taken seriously unless you consider they are out stealing jobs from the whites and such whatnot. Maybe more like privileged unprepared white boy making hay selling snake oil to the brainwashed? My goodness, cut back on the mansion size dude and buy some security if you're out selling division!

He'll avoid dealing with it if allowed, as all others have. But push come to shove...just don't own any US long term high yielding debt unless you can handle restructuring (lowering the interest payment). Remember the one thing related to business that defines the man in charge is respect, or lack thereof, of debt and debt holders.

I wasn't referring to anything you wrote Reds, just trying to figure out how to write what I'm thinking...something I'm not good with.

Check my rewording on that. It ain't one sided. This: Or is immigration an easily planned and solved problem deliberately not solved, instead used for politics and votes?