Brown & Brown (BRO) versus Its Rivals Critical Survey

Brown & Brown (NYSE: BRO) is one of 19 publicly-traded companies in the “Insurance agents, brokers, & service” industry, but how does it weigh in compared to its competitors? We will compare Brown & Brown to similar companies based on the strength of its analyst recommendations, earnings, institutional ownership, risk, dividends, valuation and profitability.

Dividends

Brown & Brown pays an annual dividend of $0.32 per share and has a dividend yield of 1.0%. Brown & Brown pays out 26.0% of its earnings in the form of a dividend. As a group, “Insurance agents, brokers, & service” companies pay a dividend yield of 1.6% and pay out 32.3% of their earnings in the form of a dividend. Brown & Brown has raised its dividend for 18 consecutive years.

Volatility & Risk

Brown & Brown has a beta of 0.73, meaning that its stock price is 27% less volatile than the S&P 500. Comparatively, Brown & Brown’s competitors have a beta of 0.85, meaning that their average stock price is 15% less volatile than the S&P 500.

Profitability

This table compares Brown & Brown and its competitors’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Brown & Brown 17.09% 12.03% 5.83%
Brown & Brown Competitors 7.10% 18.05% 9.00%

Valuation & Earnings

This table compares Brown & Brown and its competitors gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Net Income Price/Earnings Ratio
Brown & Brown $2.01 billion $344.26 million 25.58
Brown & Brown Competitors $13.74 billion $1.05 billion 34.21

Brown & Brown’s competitors have higher revenue and earnings than Brown & Brown. Brown & Brown is trading at a lower price-to-earnings ratio than its competitors, indicating that it is currently more affordable than other companies in its industry.

Institutional & Insider Ownership

72.2% of Brown & Brown shares are held by institutional investors. Comparatively, 65.0% of shares of all “Insurance agents, brokers, & service” companies are held by institutional investors. 16.7% of Brown & Brown shares are held by insiders. Comparatively, 26.6% of shares of all “Insurance agents, brokers, & service” companies are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a summary of current recommendations for Brown & Brown and its competitors, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Brown & Brown 3 4 2 0 1.89
Brown & Brown Competitors 192 693 776 40 2.39

Brown & Brown presently has a consensus price target of $29.67, indicating a potential downside of 5.70%. As a group, “Insurance agents, brokers, & service” companies have a potential upside of 8.02%. Given Brown & Brown’s competitors stronger consensus rating and higher probable upside, analysts clearly believe Brown & Brown has less favorable growth aspects than its competitors.

Summary

Brown & Brown competitors beat Brown & Brown on 12 of the 15 factors compared.

Brown & Brown Company Profile

Brown & Brown, Inc. markets and sells insurance products and services in the United States, England, Canada, Bermuda, and the Cayman Islands. It operates through four segments: Retail, National Programs, Wholesale Brokerage, and Services. The Retail segment offers commercial packages, group medical, workers' compensation, property risk, and general liability insurance products; and group and individual life, accident, disability, health, hospitalization, medical, dental, and other ancillary insurance products, as well as risk management, loss control survey and analysis, consultancy, and claims processing services. It serves commercial, public and quasi-public entities, professional, and individual customers. The National Programs segment offers professional liability and related package insurance products for dentists, oral surgeons, hygienists, lawyers, optometrists, opticians, ophthalmologists, insurance agents, financial advisors, registered representatives, securities broker-dealers, benefit administrators, real estate title agents, and escrow agents, as well as supplementary insurance products related to weddings, events, medical facilities, and cyber liabilities. This segment also offers outsourced product development, marketing, underwriting, actuarial, compliance, and claims and other administrative services to insurance carrier partners; and commercial and public entity-related programs, and flood insurance products. It serves through independent agents. The Wholesale Brokerage segment markets and sells excess and surplus commercial and personal lines insurance through independent agents and brokers. The Services segment offers third-party claims administration and medical utilization management services in the workers' compensation and all-lines liability arenas, Medicare Set-aside, Social Security disability, Medicare benefits advocacy, and claims adjusting services. Brown & Brown, Inc. was founded in 1939 and is headquartered in Daytona Beach, Florida.

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