BROWN & BROWN INC (BRO) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:BRO - US1152361010 - Common Stock
80.64 USD
+0.05 (+0.06%)
80.75 USD
+0.11 (+0.14%)
We assign a fundamental rating of 5 out of 10 to BRO. BRO was compared to 148 industry peers in the Insurance industry. BRO has only an average score on both its financial health and profitability. BRO is quite expensive at the moment. It does show a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year BRO was profitable.
In the past year BRO had a positive cash flow from operations.
In the past 5 years BRO has always been profitable.
In the past 5 years BRO always reported a positive cash flow from operatings.
1.2 Ratios
Looking at the Return On Assets, with a value of 3.36%, BRO is in the better half of the industry, outperforming 68.92% of the companies in the same industry.
The Return On Equity of BRO (7.97%) is worse than 66.22% of its industry peers.
BRO has a Return On Invested Capital of 5.43%. This is amongst the best in the industry. BRO outperforms 81.76% of its industry peers.
The Average Return On Invested Capital over the past 3 years for BRO is significantly below the industry average of 14.93%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.36% | ||
| ROE | 7.97% | ||
| ROIC | 5.43% |
ROA(3y)5.35%
ROA(5y)5.42%
ROE(3y)14.98%
ROE(5y)14.21%
ROIC(3y)9.07%
ROIC(5y)8.85%
1.3 Margins
The Profit Margin of BRO (18.02%) is better than 86.49% of its industry peers.
BRO's Profit Margin has improved in the last couple of years.
BRO has a Operating Margin of 29.15%. This is amongst the best in the industry. BRO outperforms 91.22% of its industry peers.
In the last couple of years the Operating Margin of BRO has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 29.15% | ||
| PM (TTM) | 18.02% | ||
| GM | N/A |
OM growth 3Y2.76%
OM growth 5Y4.78%
PM growth 3Y2.76%
PM growth 5Y4.84%
GM growth 3YN/A
GM growth 5YN/A
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), BRO is 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.
Compared to 1 year ago, BRO has an improved debt to assets ratio.
2.2 Solvency
Based on the Altman-Z score of 1.71, we must say that BRO is in the distress zone and has some risk of bankruptcy.
The Altman-Z score of BRO (1.71) is better than 87.84% of its industry peers.
BRO has a debt to FCF ratio of 5.95. This is a neutral value as BRO would need 5.95 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 5.95, BRO is doing worse than 64.86% of the companies in the same industry.
BRO has a Debt/Equity ratio of 0.62. This is a neutral value indicating BRO is somewhat dependend on debt financing.
With a Debt to Equity ratio value of 0.62, BRO is not doing good in the industry: 77.70% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.62 | ||
| Debt/FCF | 5.95 | ||
| Altman-Z | 1.71 |
ROIC/WACC0.66
WACC8.22%
2.3 Liquidity
BRO has a Current Ratio of 1.18. This is a normal value and indicates that BRO is financially healthy and should not expect problems in meeting its short term obligations.
The Current ratio of BRO (1.18) is better than 83.11% of its industry peers.
BRO has a Quick Ratio of 1.18. 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 Quick ratio of 1.18. This is amongst the best in the industry. BRO outperforms 83.11% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.18 | ||
| Quick Ratio | 1.18 |
3. Growth
3.1 Past
BRO shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 18.82%, which is quite good.
Measured over the past years, BRO shows a very strong growth in Earnings Per Share. The EPS has been growing by 22.36% on average per year.
Looking at the last year, BRO shows a quite strong growth in Revenue. The Revenue has grown by 17.85% in the last year.
BRO shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 14.97% yearly.
EPS 1Y (TTM)18.82%
EPS 3Y20.59%
EPS 5Y22.36%
EPS Q2Q%15.38%
Revenue 1Y (TTM)17.85%
Revenue growth 3Y16.34%
Revenue growth 5Y14.97%
Sales Q2Q%35.41%
3.2 Future
BRO is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 10.69% yearly.
BRO is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 7.67% yearly.
EPS Next Y11.59%
EPS Next 2Y11.02%
EPS Next 3Y10.69%
EPS Next 5YN/A
Revenue Next Year25.28%
Revenue Next 2Y24.34%
Revenue Next 3Y18.19%
Revenue Next 5Y7.67%
3.3 Evolution
The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
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
A Price/Earnings ratio of 19.06 indicates a rather expensive valuation of BRO.
64.86% of the companies in the same industry are cheaper than BRO, based on the Price/Earnings ratio.
The average S&P500 Price/Earnings ratio is at 27.19. BRO is valued slightly cheaper when compared to this.
BRO is valuated rather expensively with a Price/Forward Earnings ratio of 17.04.
Based on the Price/Forward Earnings ratio, BRO is valued a bit more expensive than the industry average as 64.19% of the companies are valued more cheaply.
Compared to an average S&P500 Price/Forward Earnings ratio of 23.88, BRO is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.06 | ||
| Fwd PE | 17.04 |
4.2 Price Multiples
66.22% of the companies in the same industry are cheaper than BRO, based on the Enterprise Value to EBITDA ratio.
Based on the Price/Free Cash Flow ratio, BRO is valued a bit more expensive than the industry average as 62.84% of the companies are valued more cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 21.19 | ||
| EV/EBITDA | 18.04 |
4.3 Compensation for Growth
BRO's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The decent profitability rating of BRO may justify a higher PE ratio.
PEG (NY)1.64
PEG (5Y)0.85
EPS Next 2Y11.02%
EPS Next 3Y10.69%
5. Dividend
5.1 Amount
BRO has a yearly dividend return of 0.83%, which is pretty low.
BRO's Dividend Yield is slightly below the industry average, which is at 2.48.
With a Dividend Yield of 0.83, BRO pays less dividend than the S&P500 average, which is at 1.94.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.83% |
5.2 History
On average, the dividend of BRO grows each year by 10.65%, which is quite nice.
BRO has paid a dividend for at least 10 years, which is a reliable track record.
BRO has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)10.65%
Div Incr Years31
Div Non Decr Years34
5.3 Sustainability
18.24% of the earnings are spent on dividend by BRO. This is a low number and sustainable payout ratio.
The dividend of BRO is growing around the same rate as the earnings are growing. If this keeps up the dividend growth is sustainable.
DP18.24%
EPS Next 2Y11.02%
EPS Next 3Y10.69%
80.64
+0.05 (+0.06%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupInsurance
GICS IndustryInsurance
Earnings (Last)
Earnings (Next)
Inst Owners80.99%
Inst Owner Change0%
Ins Owners13.08%
Ins Owner Change-0.06%
Market Cap27.53B
Revenue(TTM)5.48B
Net Income(TTM)987.00M
Analysts68.57
Price Target95.91 (18.94%)
Short Float %3.94%
Short Ratio4.15
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.83% |
Yearly Dividend0.54
Dividend Growth(5Y)10.65%
DP18.24%
Div Incr Years31
Div Non Decr Years34
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)6.9%
Min EPS beat(2)3.03%
Max EPS beat(2)10.78%
EPS beat(4)3
Avg EPS beat(4)5.69%
Min EPS beat(4)-2.08%
Max EPS beat(4)11.02%
EPS beat(8)7
Avg EPS beat(8)5.75%
EPS beat(12)11
Avg EPS beat(12)6.9%
EPS beat(16)14
Avg EPS beat(16)4.84%
Revenue beat(2)1
Avg Revenue beat(2)1.77%
Min Revenue beat(2)-0.54%
Max Revenue beat(2)4.08%
Revenue beat(4)2
Avg Revenue beat(4)1.76%
Min Revenue beat(4)-0.99%
Max Revenue beat(4)4.5%
Revenue beat(8)6
Avg Revenue beat(8)1.9%
Revenue beat(12)9
Avg Revenue beat(12)2.04%
Revenue beat(16)12
Avg Revenue beat(16)1.65%
PT rev (1m)-3.07%
PT rev (3m)-14.46%
EPS NQ rev (1m)0.24%
EPS NQ rev (3m)-2.91%
EPS NY rev (1m)-0.42%
EPS NY rev (3m)1.63%
Revenue NQ rev (1m)0.42%
Revenue NQ rev (3m)-0.83%
Revenue NY rev (1m)0.08%
Revenue NY rev (3m)1.33%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.06 | ||
| Fwd PE | 17.04 | ||
| P/S | 5.03 | ||
| P/FCF | 21.19 | ||
| P/OCF | 20.14 | ||
| P/B | 2.22 | ||
| P/tB | N/A | ||
| EV/EBITDA | 18.04 |
EPS(TTM)4.23
EY5.25%
EPS(NY)4.73
Fwd EY5.87%
FCF(TTM)3.8
FCFY4.72%
OCF(TTM)4
OCFY4.97%
SpS16.04
BVpS36.28
TBVpS-21.84
PEG (NY)1.64
PEG (5Y)0.85
Graham Number58.76
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.36% | ||
| ROE | 7.97% | ||
| ROCE | 7.11% | ||
| ROIC | 5.43% | ||
| ROICexc | 5.74% | ||
| ROICexgc | 85.29% | ||
| OM | 29.15% | ||
| PM (TTM) | 18.02% | ||
| GM | N/A | ||
| FCFM | 23.71% |
ROA(3y)5.35%
ROA(5y)5.42%
ROE(3y)14.98%
ROE(5y)14.21%
ROIC(3y)9.07%
ROIC(5y)8.85%
ROICexc(3y)9.73%
ROICexc(5y)9.73%
ROICexgc(3y)222.79%
ROICexgc(5y)196.94%
ROCE(3y)11.87%
ROCE(5y)11.58%
ROICexgc growth 3Y-5.47%
ROICexgc growth 5Y1.96%
ROICexc growth 3Y0.09%
ROICexc growth 5Y3.73%
OM growth 3Y2.76%
OM growth 5Y4.78%
PM growth 3Y2.76%
PM growth 5Y4.84%
GM growth 3YN/A
GM growth 5YN/A
F-Score4
Asset Turnover0.19
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.62 | ||
| Debt/FCF | 5.95 | ||
| Debt/EBITDA | 4.05 | ||
| Cap/Depr | 23.37% | ||
| Cap/Sales | 1.24% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 72.4% | ||
| Profit Quality | 131.61% | ||
| Current Ratio | 1.18 | ||
| Quick Ratio | 1.18 | ||
| Altman-Z | 1.71 |
F-Score4
WACC8.22%
ROIC/WACC0.66
Cap/Depr(3y)32.9%
Cap/Depr(5y)36.11%
Cap/Sales(3y)1.6%
Cap/Sales(5y)1.8%
Profit Quality(3y)115.6%
Profit Quality(5y)123.95%
High Growth Momentum
Growth
EPS 1Y (TTM)18.82%
EPS 3Y20.59%
EPS 5Y22.36%
EPS Q2Q%15.38%
EPS Next Y11.59%
EPS Next 2Y11.02%
EPS Next 3Y10.69%
EPS Next 5YN/A
Revenue 1Y (TTM)17.85%
Revenue growth 3Y16.34%
Revenue growth 5Y14.97%
Sales Q2Q%35.41%
Revenue Next Year25.28%
Revenue Next 2Y24.34%
Revenue Next 3Y18.19%
Revenue Next 5Y7.67%
EBIT growth 1Y14.4%
EBIT growth 3Y19.55%
EBIT growth 5Y20.47%
EBIT Next Year36.54%
EBIT Next 3Y22.32%
EBIT Next 5Y10.16%
FCF growth 1Y40.11%
FCF growth 3Y12.65%
FCF growth 5Y12.53%
OCF growth 1Y38.68%
OCF growth 3Y13.23%
OCF growth 5Y11.6%
BROWN & BROWN INC / BRO FAQ
Can you provide the ChartMill fundamental rating for BROWN & BROWN INC?
ChartMill assigns a fundamental rating of 5 / 10 to BRO.
What is the valuation status for BRO stock?
ChartMill assigns a valuation rating of 2 / 10 to BROWN & BROWN INC (BRO). This can be considered as Overvalued.
What is the profitability of BRO stock?
BROWN & BROWN INC (BRO) has a profitability rating of 6 / 10.
What is the valuation of BROWN & BROWN INC based on its PE and PB ratios?
The Price/Earnings (PE) ratio for BROWN & BROWN INC (BRO) is 19.06 and the Price/Book (PB) ratio is 2.22.
How sustainable is the dividend of BROWN & BROWN INC (BRO) stock?
The dividend rating of BROWN & BROWN INC (BRO) is 5 / 10 and the dividend payout ratio is 18.24%.