BROWN & BROWN INC (BRO)
US1152361010 - Common Stock
We assign a fundamental rating of 6 out of 10 to BRO. BRO was compared to 141 industry peers in the Insurance industry. While BRO has a great profitability rating, there are some minor concerns on its financial health. BRO is valied quite expensively at the moment, while it does show a decent growth rate.
1. Profitability
1.1 Basic Checks
BRO had positive earnings in the past year.
In the past year BRO had a positive cash flow from operations.
BRO had positive earnings in each of the past 5 years.
Each year in the past 5 years BRO had a positive operating cash flow.
1.2 Ratios
BRO has a Return On Assets of 6.15%. This is amongst the best in the industry. BRO outperforms 90.65% of its industry peers.
BRO has a Return On Equity of 16.28%. This is in the better half of the industry: BRO outperforms 72.66% of its industry peers.
Looking at the Return On Invested Capital, with a value of 9.80%, BRO belongs to the top of the industry, outperforming 96.40% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for BRO is above the industry average of 4.02%.
The 3 year average ROIC (8.82%) for BRO is below the current ROIC(9.80%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.15% | ||
| ROE | 16.28% | ||
| ROIC | 9.8% |
ROA(3y)5.45%
ROA(5y)5.32%
ROE(3y)14.45%
ROE(5y)13.45%
ROIC(3y)8.82%
ROIC(5y)8.43%
1.3 Margins
With an excellent Profit Margin value of 21.66%, BRO belongs to the best of the industry, outperforming 90.65% of the companies in the same industry.
In the last couple of years the Profit Margin of BRO has grown nicely.
With an excellent Operating Margin value of 29.91%, BRO belongs to the best of the industry, outperforming 90.65% of the companies in the same industry.
BRO's Operating Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 29.91% | ||
| PM (TTM) | 21.66% | ||
| GM | N/A |
OM growth 3Y3.31%
OM growth 5Y2.66%
PM growth 3Y4.19%
PM growth 5Y3.84%
GM growth 3YN/A
GM growth 5YN/A
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so BRO is still creating some value.
The number of shares outstanding for BRO has been increased compared to 1 year ago.
BRO has more shares outstanding than it did 5 years ago.
BRO has a better debt/assets ratio than last year.
2.2 Solvency
BRO has an Altman-Z score of 2.89. This is not the best score and indicates that BRO is in the grey zone with still only limited risk for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 2.89, BRO belongs to the top of the industry, outperforming 95.68% of the companies in the same industry.
BRO has a debt to FCF ratio of 4.52. This is a neutral value as BRO would need 4.52 years to pay back of all of its debts.
BRO has a worse Debt to FCF ratio (4.52) than 63.31% of its industry peers.
BRO has a Debt/Equity ratio of 0.56. This is a neutral value indicating BRO is somewhat dependend on debt financing.
BRO's Debt to Equity ratio of 0.56 is on the low side compared to the rest of the industry. BRO is outperformed by 69.78% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.56 | ||
| Debt/FCF | 4.52 | ||
| Altman-Z | 2.89 |
ROIC/WACC1.21
WACC8.1%
2.3 Liquidity
BRO has a Current Ratio of 1.13. This is a normal value and indicates that BRO is financially healthy and should not expect problems in meeting its short term obligations.
BRO has a better Current ratio (1.13) than 81.30% of its industry peers.
BRO has a Quick Ratio of 1.13. This is a normal value and indicates that BRO is financially healthy and should not expect problems in meeting its short term obligations.
With an excellent Quick ratio value of 1.13, BRO belongs to the best of the industry, outperforming 81.30% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.13 | ||
| Quick Ratio | 1.13 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 33.33% over the past year.
The Earnings Per Share has been growing by 17.97% on average over the past years. This is quite good.
The Revenue has grown by 13.47% in the past year. This is quite good.
Measured over the past years, BRO shows a quite strong growth in Revenue. The Revenue has been growing by 16.15% on average per year.
EPS 1Y (TTM)33.33%
EPS 3Y18.47%
EPS 5Y17.97%
EPS Q2Q%36.76%
Revenue 1Y (TTM)13.47%
Revenue growth 3Y17.66%
Revenue growth 5Y16.15%
Sales Q2Q%12.48%
3.2 Future
The Earnings Per Share is expected to grow by 16.53% on average over the next years. This is quite good.
The Revenue is expected to grow by 9.17% on average over the next years. This is quite good.
EPS Next Y33.19%
EPS Next 2Y20.47%
EPS Next 3Y16.53%
EPS Next 5YN/A
Revenue Next Year11.78%
Revenue Next 2Y9.89%
Revenue Next 3Y9.17%
Revenue Next 5YN/A
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 31.32, the valuation of BRO can be described as expensive.
Based on the Price/Earnings ratio, BRO is valued a bit more expensive than the industry average as 73.38% of the companies are valued more cheaply.
The average S&P500 Price/Earnings ratio is at 30.97. BRO is around the same levels.
With a Price/Forward Earnings ratio of 25.81, BRO can be considered very expensive at the moment.
Based on the Price/Forward Earnings ratio, BRO is valued a bit more expensive than the industry average as 76.26% of the companies are valued more cheaply.
When comparing the Price/Forward Earnings ratio of BRO to the average of the S&P500 Index (22.29), we can say BRO is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 31.32 | ||
| Fwd PE | 25.81 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of BRO indicates a slightly more expensive valuation: BRO is more expensive than 60.43% of the companies listed in the same industry.
Based on the Price/Free Cash Flow ratio, BRO is valued a bit more expensive than the industry average as 73.38% of the companies are valued more cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 32.95 | ||
| EV/EBITDA | 20.52 |
4.3 Compensation for Growth
The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
BRO has an outstanding profitability rating, which may justify a higher PE ratio.
BRO's earnings are expected to grow with 16.53% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.94
PEG (5Y)1.74
EPS Next 2Y20.47%
EPS Next 3Y16.53%
5. Dividend
5.1 Amount
With a yearly dividend of 0.50%, BRO is not a good candidate for dividend investing.
BRO's Dividend Yield is slightly below the industry average, which is at 5.21.
Compared to an average S&P500 Dividend Yield of 2.22, BRO's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.5% |
5.2 History
The dividend of BRO is nicely growing with an annual growth rate of 9.32%!
BRO has been paying a dividend for at least 10 years, so it has a reliable track record.
BRO has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)9.32%
Div Incr Years30
Div Non Decr Years33
5.3 Sustainability
BRO pays out 14.76% of its income as dividend. This is a sustainable payout ratio.
The dividend of BRO is growing, but earnings are growing more, so the dividend growth is sustainable.
DP14.76%
EPS Next 2Y20.47%
EPS Next 3Y16.53%
BROWN & BROWN INC
NYSE:BRO (10/8/2024, 8:04:01 PM)
After market: 105.25 0 (0%)105.25
+3.12 (+3.05%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupInsurance
GICS IndustryInsurance
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap30.02B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.5% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
Max EPS beat(2)
EPS beat(4)
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EPS beat(8)
Avg EPS beat(8)
EPS beat(12)
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EPS beat(16)
Avg EPS beat(16)
Revenue beat(2)
Avg Revenue beat(2)
Min Revenue beat(2)
Max Revenue beat(2)
Revenue beat(4)
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Min Revenue beat(4)
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Revenue beat(8)
Avg Revenue beat(8)
Revenue beat(12)
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Revenue beat(16)
Avg Revenue beat(16)
PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 31.32 | ||
| Fwd PE | 25.81 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)0.94
PEG (5Y)1.74
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.15% | ||
| ROE | 16.28% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 29.91% | ||
| PM (TTM) | 21.66% | ||
| GM | N/A | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.28
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.56 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 1.13 | ||
| Quick Ratio | 1.13 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
High Growth Momentum
Growth
EPS 1Y (TTM)33.33%
EPS 3Y18.47%
EPS 5Y
EPS Q2Q%
EPS Next Y33.19%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)13.47%
Revenue growth 3Y17.66%
Revenue growth 5Y
Sales Q2Q%
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y