BROWN & BROWN INC (BRO) Stock Fundamental Analysis
USA - NYSE:BRO - US1152361010 - Common Stock
94.95 USD
+1.5 (+1.61%)
94.77 USD
-0.18 (-0.19%)
Overall BRO gets a fundamental rating of 5 out of 10. We evaluated BRO against 146 industry peers in the Insurance industry. BRO scores excellent on profitability, but there are some minor concerns on its financial health. While showing a medium growth rate, BRO is valued expensive at the moment.
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.
In the past 5 years BRO has always been profitable.
BRO had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
Looking at the Return On Assets, with a value of 3.87%, BRO is in the better half of the industry, outperforming 78.08% of the companies in the same industry.
BRO has a Return On Equity (8.56%) which is in line with its industry peers.
The Return On Invested Capital of BRO (5.75%) is better than 85.62% of its industry peers.
The Average Return On Invested Capital over the past 3 years for BRO is above the industry average of 4.40%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.87% | ||
| ROE | 8.56% | ||
| ROIC | 5.75% |
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
With an excellent Profit Margin value of 19.63%, BRO belongs to the best of the industry, outperforming 89.73% of the companies in the same industry.
In the last couple of years the Profit Margin of BRO has grown nicely.
BRO's Operating Margin of 30.31% is amongst the best of the industry. BRO outperforms 97.26% of its industry peers.
In the last couple of years the Operating Margin of BRO has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 30.31% | ||
| PM (TTM) | 19.63% | ||
| 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.
Compared to 5 years ago, BRO has more shares outstanding
BRO has a better debt/assets ratio than last year.
2.2 Solvency
BRO has an Altman-Z score of 2.52. 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.
BRO's Altman-Z score of 2.52 is amongst the best of the industry. BRO outperforms 90.41% of its industry peers.
The Debt to FCF ratio of BRO is 5.97, which is a neutral value as it means it would take BRO, 5.97 years of fcf income to pay off all of its debts.
BRO's Debt to FCF ratio of 5.97 is on the low side compared to the rest of the industry. BRO is outperformed by 61.64% of its industry peers.
BRO has a Debt/Equity ratio of 0.64. This is a neutral value indicating BRO is somewhat dependend on debt financing.
With a Debt to Equity ratio value of 0.64, BRO is not doing good in the industry: 82.19% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.64 | ||
| Debt/FCF | 5.97 | ||
| Altman-Z | 2.52 |
ROIC/WACC0.7
WACC8.23%
2.3 Liquidity
BRO has a Current Ratio of 2.75. This indicates that BRO is financially healthy and has no problem in meeting its short term obligations.
BRO's Current ratio of 2.75 is amongst the best of the industry. BRO outperforms 91.10% of its industry peers.
BRO has a Quick Ratio of 2.75. This indicates that BRO is financially healthy and has no problem in meeting its short term obligations.
The Quick ratio of BRO (2.75) is better than 91.10% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.75 | ||
| Quick Ratio | 2.75 |
3. Growth
3.1 Past
BRO shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 21.73%, which is quite impressive.
BRO shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 22.36% yearly.
The Revenue has grown by 11.66% 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 14.97% on average per year.
EPS 1Y (TTM)21.73%
EPS 3Y20.59%
EPS 5Y22.36%
EPS Q2Q%10.75%
Revenue 1Y (TTM)11.66%
Revenue growth 3Y16.34%
Revenue growth 5Y14.97%
Sales Q2Q%9.08%
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 11.41% yearly.
Based on estimates for the next years, BRO will show a small growth in Revenue. The Revenue will grow by 7.67% on average per year.
EPS Next Y9.81%
EPS Next 2Y11.84%
EPS Next 3Y11.41%
EPS Next 5YN/A
Revenue Next Year23.63%
Revenue Next 2Y24.43%
Revenue Next 3Y18.57%
Revenue Next 5Y7.67%
3.3 Evolution
Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of 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
With a Price/Earnings ratio of 23.22, BRO is valued on the expensive side.
Based on the Price/Earnings ratio, BRO is valued a bit more expensive than 75.34% of the companies in the same industry.
BRO's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 27.86.
A Price/Forward Earnings ratio of 19.77 indicates a rather expensive valuation of BRO.
BRO's Price/Forward Earnings ratio is a bit more expensive when compared to the industry. BRO is more expensive than 69.86% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 23.32. BRO is around the same levels.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.22 | ||
| Fwd PE | 19.77 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, BRO is valued a bit more expensive than the industry average as 61.64% of the companies are valued more cheaply.
BRO's Price/Free Cash Flow ratio is a bit more expensive when compared to the industry. BRO is more expensive than 62.33% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 24.78 | ||
| EV/EBITDA | 16.89 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
BRO has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)2.37
PEG (5Y)1.04
EPS Next 2Y11.84%
EPS Next 3Y11.41%
5. Dividend
5.1 Amount
With a yearly dividend of 0.64%, BRO is not a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 3.33, BRO is paying slightly less dividend.
With a Dividend Yield of 0.64, BRO pays less dividend than the S&P500 average, which is at 2.44.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.64% |
5.2 History
The dividend of BRO is nicely growing with an annual growth rate of 10.65%!
BRO has paid a dividend for at least 10 years, which is a reliable track record.
BRO has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)10.65%
Div Incr Years31
Div Non Decr Years34
5.3 Sustainability
16.62% 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.
DP16.62%
EPS Next 2Y11.84%
EPS Next 3Y11.41%
94.95
+1.5 (+1.61%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupInsurance
GICS IndustryInsurance
Earnings (Last)
Earnings (Next)
Inst Owners82.94%
Inst Owner Change-0.01%
Ins Owners13.55%
Ins Owner Change0.54%
Market Cap31.32B
Analysts71
Price Target112.13 (18.09%)
Short Float %2.41%
Short Ratio2.27
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.64% |
Yearly Dividend0.54
Dividend Growth(5Y)10.65%
DP16.62%
Div Incr Years31
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)0.47%
Min EPS beat(2)-2.08%
Max EPS beat(2)3.03%
EPS beat(4)3
Avg EPS beat(4)3.72%
Min EPS beat(4)-2.08%
Max EPS beat(4)11.02%
EPS beat(8)7
Avg EPS beat(8)6.11%
EPS beat(12)10
Avg EPS beat(12)4.48%
EPS beat(16)14
Avg EPS beat(16)4.72%
Revenue beat(2)0
Avg Revenue beat(2)-0.76%
Min Revenue beat(2)-0.99%
Max Revenue beat(2)-0.54%
Revenue beat(4)2
Avg Revenue beat(4)0.93%
Min Revenue beat(4)-0.99%
Max Revenue beat(4)4.5%
Revenue beat(8)6
Avg Revenue beat(8)1.66%
Revenue beat(12)8
Avg Revenue beat(12)1.45%
Revenue beat(16)12
Avg Revenue beat(16)1.4%
PT rev (1m)0%
PT rev (3m)-7.56%
EPS NQ rev (1m)-0.88%
EPS NQ rev (3m)-2.94%
EPS NY rev (1m)-0.25%
EPS NY rev (3m)-0.33%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)17.37%
Revenue NY rev (1m)0.02%
Revenue NY rev (3m)11.64%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.22 | ||
| Fwd PE | 19.77 | ||
| P/S | 6.19 | ||
| P/FCF | 24.78 | ||
| P/OCF | 23.39 | ||
| P/B | 2.7 | ||
| P/tB | 22.98 | ||
| EV/EBITDA | 16.89 |
EPS(TTM)4.09
EY4.31%
EPS(NY)4.8
Fwd EY5.06%
FCF(TTM)3.83
FCFY4.04%
OCF(TTM)4.06
OCFY4.28%
SpS15.33
BVpS35.15
TBVpS4.13
PEG (NY)2.37
PEG (5Y)1.04
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.87% | ||
| ROE | 8.56% | ||
| ROCE | 7.52% | ||
| ROIC | 5.75% | ||
| ROICexc | 10.2% | ||
| ROICexgc | 93.36% | ||
| OM | 30.31% | ||
| PM (TTM) | 19.63% | ||
| GM | N/A | ||
| FCFM | 24.99% |
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%
ROICexcg growth 3Y-5.47%
ROICexcg 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 Turnover0.2
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.64 | ||
| Debt/FCF | 5.97 | ||
| Debt/EBITDA | 4.21 | ||
| Cap/Depr | 31.12% | ||
| Cap/Sales | 1.48% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 75.48% | ||
| Profit Quality | 127.29% | ||
| Current Ratio | 2.75 | ||
| Quick Ratio | 2.75 | ||
| Altman-Z | 2.52 |
F-Score4
WACC8.23%
ROIC/WACC0.7
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)21.73%
EPS 3Y20.59%
EPS 5Y22.36%
EPS Q2Q%10.75%
EPS Next Y9.81%
EPS Next 2Y11.84%
EPS Next 3Y11.41%
EPS Next 5YN/A
Revenue 1Y (TTM)11.66%
Revenue growth 3Y16.34%
Revenue growth 5Y14.97%
Sales Q2Q%9.08%
Revenue Next Year23.63%
Revenue Next 2Y24.43%
Revenue Next 3Y18.57%
Revenue Next 5Y7.67%
EBIT growth 1Y13.14%
EBIT growth 3Y19.55%
EBIT growth 5Y20.47%
EBIT Next Year35.56%
EBIT Next 3Y22.96%
EBIT Next 5Y10.16%
FCF growth 1Y46.25%
FCF growth 3Y12.65%
FCF growth 5Y12.53%
OCF growth 1Y44.96%
OCF growth 3Y13.23%
OCF growth 5Y11.6%