UPDATE: Credit Suisse Initiates Coverage on Arthur J. Gallagher & Co. with Outperform Rating, $53 PT as M&A Drives Free Cash Flow Growth

In a report published Wednesday, Credit Suisse analyst Ryan Tunis initiated coverage on

with an Outperform rating and $53.00 price target. In the report, Credit Suisse noted, "Despite concern around rate softening in the U.S., we think that the combination of U.S. economic growth and our expectation for moderate P&C rate softening still compares favorably to other major commercial P&C markets, particularly in the smaller middle-market commercial segment, a major part of AJG's business. As a result, we expect AJG to generate the best organic growth of the brokers in our coverage in 2015. In our view, the company's lack of exposure to the structurally challenged reinsurance brokerage business and limited exposure to healthcare exchanges provide added 24-month visibility around growth." Arthur J. Gallagher & Co. closed on Tuesday at $46.75.