10Y annualized return is
excellent
at 21.1% per year
BRO has met or exceeded earnings expectations in
most
recent quarters (9/10)
Moderate Growth Potential
Strong Profit Margins
High Return on Equity
Low Debt Levels
Strong Liquidity Position
Strong Revenue Growth
High EBITDAC Margin
Successful M&A Strategy
Optimistic Growth Outlook
Market Positioning and Capability Expansion
High Price to Sales Ratio
Average Operating Profit Margin
Low Cash Ratio
Dependency on Market Conditions
Pressure on Contingent Commissions
Potential Margin Pressure
Overall, Brown & Brown demonstrates a strong business model with solid revenue growth and profitability, supported by a successful M&A strategy. However, its future prospects may be tempered by external market pressures and anticipated declines in contingent commissions.
Analysis Date: January 28, 2025
Last Updated: March 11, 2025
Past performance does not guarantee future results. The data presented is indicative and may not be updated in real-time.
Brown & Brown, Inc. is an insurance company that helps people and businesses find the right insurance coverage. They offer different types of insurance, like home, car, and business insurance, to protect against accidents and losses. The company also provides special services, like helping people manage their claims and offering insurance for unique needs, such as weddings or medical facilities. Founded in 1939 and based in Daytona Beach, Florida, they work with various clients, including individuals, companies, and government organizations across several countries.
Streams of revenue
Geographic Distribution
Core Products
Business Type
Business to Business
Competitive Advantages
Key Business Risks
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Trailing Twelve Months (TTM) values provide a view of the company's performance over the last year.
Benjamin Graham's value investing approach focuses on finding stocks with a significant margin of safety between their intrinsic value and market price.
Intrinsic Value
Estimated fair value based on Graham's formula
$135.23
Current Market Price: $116.48
IV/P Ratio: 1.16x (>1.0 indicates undervalued)
Margin of Safety
Gap between intrinsic value and market price
14.000000000000002%
Graham recommended a minimum of 20-30% margin of safety
Higher values indicate a greater potential discount to fair value
Graham Criteria Checklist
Benjamin Graham's value investing checklist for BRO
Positive earnings (5+ years)
Dividend history (5+ years)
P/E ratio ≤ 20 (32.74)
P/B ratio ≤ 1.5 (5.06)
Current ratio ≥ 2.0 (1.10x)
Long-term debt < Net current assets (0.31x)
Margin of safety (14.000000000000002%)
BRO does not meet all Graham criteria
Trailing Twelve Months (TTM) values provide a view of the company's performance over the last year.
Profitability metrics measure a company's ability to generate earnings relative to its revenue, operating costs, and other relevant metrics. Higher values generally indicate better performance.
Return on Equity (ROE)
Measures how efficiently a company uses its equity to generate profits
16.02%
Higher values indicate better returns for shareholders
TTM (as of 2025-04-30)
Gross Profit Margin
Percentage of revenue retained after accounting for cost of goods sold
69.54%
Higher values indicate better efficiency in production
TTM (as of 2025-04-30)
Net Profit Margin
Percentage of revenue retained after accounting for all expenses
20.68%
Higher values indicate better overall profitability
TTM (as of 2025-04-30)
Gross profit margin of 69.54% and net profit margin of 20.68% indicate strong operational efficiency and profitability.
A return on equity of 16.09% signifies effective management and strong returns for shareholders.
An operating profit margin of 23.62% is decent but may indicate room for improvement relative to peers.
Financial health metrics assess a company's ability to meet its financial obligations and its overall financial stability.
Debt to Equity Ratio
Total debt divided by total equity
0.06x
Lower values indicate less financial leverage and risk
Less than 1.0 is conservative, 1.0-2.0 is moderate, >2.0 indicates high risk
Q4 2024
Current Ratio
Current assets divided by current liabilities
1.10x
Higher values indicate better short-term liquidity
Less than 1.0 is concerning, 1.0-2.0 is adequate, greater than 2.0 is good
Q4 2024
A debt-to-equity ratio of 0.064 demonstrates a strong balance sheet with very low reliance on debt.
Current ratio and quick ratio both above 1 indicate healthy liquidity to cover short-term obligations.
A cash ratio of 0.107 suggests limited cash reserves relative to current liabilities, which could pose liquidity risks.
Meeting Expectations
Higher values indicate better execution and credibility
Recent Results
EPS
Brown & Brown reported nearly $5 billion in revenue for the year with a total growth of 13% and organic growth of over 10%. This strong financial performance indicates a solid business model.
The company achieved an adjusted EBITDAC margin of over 35%, which is an indicator of operational efficiency and profitability.
Brown & Brown completed 10 acquisitions in 2024, enhancing their market position with an additional estimated annual revenue of $137 million. This demonstrates their ability to strategically grow through acquisitions.
The company highlighted potential headwinds from external factors such as the California wildfires and the impact of the 2025 hurricane season on insurance pricing, indicating vulnerability to market fluctuations.
Brown & Brown's leadership expressed confidence in continued growth, driven by a stable economic environment and an optimistic view on new business acquisition across all segments.
The company is investing in its capabilities and leveraging its collective strengths to win new business, which positions them well for future growth.
The company anticipates a slight decrease in contingent commissions for 2025, which could impact revenue streams.
There are expectations of flat adjusted EBITDAC margins for 2025 due to various headwinds, which could limit profitability growth.