How does BROWN & BROWN INC (NYSE:BRO) stack up against Mark Minervini’s strategy?

Our stock screener has spotted BROWN & BROWN INC (NYSE:BRO) as a stocks which checks several boxes as specified by Mark Minervini. We will dive into an analysis below.

A Technical Analysis using the Minervini Trend Template.

BRO checks all the boxes when evaluating the Minervini Trend Template. This is a set of basic technical criteria to identify stocks in strong uptrends:

• ✔ Relative Strength is above 70.
• ✔ Current price is within 25% of it's 52-week high.
• ✔ Current price is at least 30% above it's 52-week low.
• ✔ The current price is above the 50-, 150- and 200-day SMA price line.
• ✔ The SMA(200) is trending upwards.
• ✔ The SMA(150) is above the SMA(200)
• ✔ The SMA(50) is above the SMA(150) and the SMA(200)

Looking into the high growth metrics of BROWN & BROWN INC

Earnings Momentum

• The EPS of BRO has exhibited growth from one quarter to another (Q2Q), with a 48.28% increase. This underscores the company's ability to generate higher earnings and improve its financial standing.
• BRO has achieved 36.65% growth in EPS over the past 12 months, reflecting a sustained improvement in earnings performance.
• The earnings per share (EPS) growth of BRO are accelerating: the current Q2Q growth of 48.28% is above the previous year Q2Q growth of 16.0%. Earnings momentum and acceleration are key for high growth systems.
• BRO has consistently exceeded EPS estimates in the last 4 quarters, demonstrating its ability to outperform market expectations. This trend highlights the company's strong financial performance and its potential for future growth.

Profitability & Financial Strength

• BRO has experienced notable growth in its operating margin over the past year, reflecting improved operational performance. This growth suggests the company's ability to generate higher profits from its core business activities.
• With a favorable trend in its free cash flow (FCF) over the past year, BRO demonstrates its ability to generate robust cash flows and maintain financial stability. This growth reflects the company's focus on efficient capital allocation and cash management.
• BRO showcases a robust Return on Equity (ROE) of 15.28%, indicating its ability to generate favorable returns for shareholders. This metric underscores the company's efficiency in utilizing its equity capital to generate profits.
• At a Debt/Equity ratio of 0.56, BRO seems well-positioned to sustain growth while keeping debt in check.

Institutional Confidence & Market Strength

• With institutional shareholders at 76.91%, BRO demonstrates a healthy ownership distribution. This reflects a mix of institutional and individual investors, creating a market environment that may foster increased trading activity and price discovery.
• BRO has achieved an impressive Relative Strength (RS) rating of 93.17, showcasing its ability to outperform the broader market. This strong performance positions BROWN & BROWN INC as an attractive stock for potential price appreciation.

Looking at the Setup

In addition to the Technical Rating, ChartMill provides a Setup Rating for each stock. This rating, ranging from 0 to 10, assesses the level of consolidation in the stock based on multiple short-term technical indicators. Currently, NYSE:BRO has a 3 as its setup rating, indicating its current consolidation status.

Although BRO has an excellent technical rating, it does not present a decent entry opportunity at the moment. Price movement has been a little bit too volatile to find a nice entry and exit point. It is probably a good idea to wait for a consolidation first.

Check the latest full technical report of BRO for a complete technical analysis.

Concluding

It looks like BROWN & BROWN INC meets the Minervini criteria. More high growth momentum breakout stocks can be found in our High Growth Momentum + Trend Template screen.

Keep in mind

This is not investing advice! The article highlights some of the observations at the time of writing, but you should always make your own analysis and invest based on your own insights.