Ryan Specialty (RYAN)

Insurance specialty broker Ryan Specialty (NYSE:RYAN) missed Wall Street’s revenue expectations in Q4 CY2025, but sales rose 13.2% year on year to $751.2 million. Its non-GAAP profit of $0.45 per share was 8.3% below analysts’ consensus estimates.

Company Overview

Founded in 2010 by insurance industry veteran Patrick Ryan, Ryan Specialty (NYSE:RYAN) is a wholesale insurance broker and underwriting manager that helps retail brokers place complex or hard-to-place risks with insurance carriers.

The insurance brokerage industry, while influenced by insurance pricing cycles, benefits from durable secular tailwinds as rising risk complexity (climate, data privacy), regulatory scrutiny, and insurance pricing inflation. These increase demand for professional risk-management advice. Brokers operate models that rely on commissions and fees tied to premium volumes and growing contributions from recurring advisory, benefits, and compliance services. Scale is a key advantage, enabling better carrier access, stronger data and benchmarking, and efficient deployment of technology and compliance investments, which in turn supports ongoing industry consolidation. The headwinds are labor intensity and wage inflation for producers, regulatory complexity (this cuts both ways, as you can see), and execution risk when integrating new digital tools into legacy workflows.

Ryan Specialty's main competitors include other wholesale insurance brokers such as Amwins Group, CRC Insurance Services (a subsidiary of Truist Financial), Brown & Brown (NYSE:BRO), and Marsh & McLennan's (NYSE:MMC) wholesale operations.

A company’s long-term performance is an indicator of its overall quality. Any business can experience short-term success, but top-performing ones enjoy sustained growth for years.

With $3.05 billion in revenue over the past 12 months, Ryan Specialty is a mid-sized business services company, which sometimes brings disadvantages compared to larger competitors benefiting from better economies of scale. On the bright side, it can still flex high growth rates because it’s working from a smaller revenue base.

As you can see below, Ryan Specialty grew its sales at an incredible 24.5% compounded annual growth rate over the last five years. This is a great starting point for our analysis because it shows Ryan Specialty’s demand was higher than many business services companies.

We at StockStory place the most emphasis on long-term growth, but within business services, a half-decade historical view may miss recent innovations or disruptive industry trends. Ryan Specialty’s annualized revenue growth of 21.2% over the last two years is below its five-year trend, but we still think the results suggest healthy demand.

This quarter, Ryan Specialty’s revenue grew by 13.2% year on year to $751.2 million but fell short of Wall Street’s estimates.

Looking ahead, sell-side analysts expect revenue to grow 17.1% over the next 12 months, a deceleration versus the last two years. Still, this projection is admirable and indicates the market is baking in success for its products and services.

Operating margin is one of the best measures of profitability because it tells us how much money a company takes home after subtracting all core expenses, like marketing and R&D.

Ryan Specialty has been an efficient company over the last five years. It was one of the more profitable businesses in the business services sector, boasting an average operating margin of 16.3%.

Analyzing the trend in its profitability, Ryan Specialty’s operating margin rose by 3.2 percentage points over the last five years, as its sales growth gave it operating leverage.

This quarter, Ryan Specialty generated an operating margin profit margin of 12.2%, down 4.3 percentage points year on year. This contraction shows it was less efficient because its expenses grew faster than its revenue.

We track the long-term change in earnings per share (EPS) for the same reason as long-term revenue growth. Compared to revenue, however, EPS highlights whether a company’s growth is profitable.

Ryan Specialty’s full-year EPS grew at an astounding 15.6% compounded annual growth rate over the last four years, better than the broader business services sector.

Like with revenue, we analyze EPS over a more recent period because it can provide insight into an emerging theme or development for the business.

Ryan Specialty’s spectacular 19.5% annual EPS growth over the last two years aligns with its revenue trend. This tells us it maintained its per-share profitability as it expanded.

In Q4, Ryan Specialty reported adjusted EPS of $0.45, in line with the same quarter last year. This print missed analysts’ estimates, but we care more about long-term adjusted EPS growth than short-term movements. Over the next 12 months, Wall Street expects Ryan Specialty’s full-year EPS of $1.97 to grow 21.4%.

If you’ve followed StockStory for a while, you know we emphasize free cash flow. Why, you ask? We believe that in the end, cash is king, and you can’t use accounting profits to pay the bills.

Ryan Specialty has shown terrific cash profitability, enabling it to reinvest, return capital to investors, and stay ahead of the competition while maintaining an ample cushion. The company’s free cash flow margin was among the best in the business services sector, averaging 18.2% over the last five years.

EPS and free cash flow tell us whether a company was profitable while growing its revenue. But was it capital-efficient? Enter ROIC, a metric showing how much operating profit a company generates relative to the money it has raised (debt and equity).

Although Ryan Specialty has shown solid fundamentals lately, it historically did a mediocre job investing in profitable growth initiatives. Its five-year average ROIC was 9.8%, somewhat low compared to the best business services companies that consistently pump out 25%+.

We like to invest in businesses with high returns, but the trend in a company’s ROIC is what often surprises the market and moves the stock price. Unfortunately, Ryan Specialty’s ROIC has stayed the same over the last few years. We still think it’s a good business, but if the company wants to reach the next level, it must improve its returns.

Ryan Specialty reported $158.3 million of cash and $3.53 billion of debt on its balance sheet in the most recent quarter. As investors in high-quality companies, we primarily focus on two things: 1) that a company’s debt level isn’t too high and 2) that its interest payments are not excessively burdening the business.

With $966.7 million of EBITDA over the last 12 months, we view Ryan Specialty’s 3.5× net-debt-to-EBITDA ratio as safe. We also see its $72.61 million of annual interest expenses as appropriate. The company’s profits give it plenty of breathing room, allowing it to continue investing in growth initiatives.

We struggled to find many positives in these results. Its revenue missed and its EPS fell short of Wall Street’s estimates. Overall, this quarter could have been better. The stock traded down 11.1% to $39.47 immediately after reporting.

Updated: February 12, 2026 at 11:08 PM EST

Are you wondering whether to buy Ryan Specialty or pass? We urge investors to not only consider the latest earnings results but also longer-term business quality and valuation as well.

There are multiple reasons why we think Ryan Specialty is an elite business services company. For starters, its revenue growth was exceptional over the last five years. On top of that, its powerful free cash flow generation enables it to stay ahead of the competition through consistent reinvestment of profits, and its astounding EPS growth over the last four years shows its profits are trickling down to shareholders.

Ryan Specialty’s P/E ratio based on the next 12 months is 18x. Looking across the spectrum of business services businesses, Ryan Specialty’s fundamentals clearly illustrate it’s a special business. We like the stock at this price.

Wall Street analysts have a consensus one-year price target of $64.31 on the company (compared to the current share price of $40.44), implying they see 59% upside in buying Ryan Specialty in the short term.