Brown & Brown, Inc.
BRO
Insurance Agents, Brokers & Service
Mkt Cap
$20.52BPE
27.91Debt
$4.27BCash
$2.271BEV
$22.51BFCF
$927.1MP/E Ratio
27.91Debt
$4.27BCash
$2.271BEV
$22.51BFCF
$927.1MBrown & Brown, Inc. markets and sells insurance products and services in the United States, Canada, Ireland, the United Kingdom, and internationally. It operates through four segments: Retail, National Programs, Wholesale Brokerage, and Services. The Retail segment provides property and casualty, employee benefits insurance products, personal insurance products, specialties insurance products, risk management strategies, 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 dentistry, legal, eyecare, insurance, financial, physicians, real estate title professionals, as well as supplementary insurance products related to weddings, events, medical facilities, and cyber liabilities. This segment also provides public entity-related and specialty programs through a network of independent agents; and program management services for insurance carrier partners. 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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DCF
Discounted Cash Flow Valuation of Brown & Brown, Inc.
Value
Growth
%
%
Discount
%
%
Multiple
| g\r | +10% | +11% | +12% | +13% | +14% |
|---|---|---|---|---|---|
| 0% | 10 | 9 | 8 | 8 | 7 |
| +1% | 11 | 10 | 9 | 8 | 8 |
| +2% | 13 | 11 | 10 | 9 | 8 |
| +3% | 14 | 13 | 11 | 10 | 9 |
| +4% | 17 | 14 | 12 | 11 | 10 |
| Years | 0 | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | TV |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| FCF | $927.1M | $1.049B | $1.177B | $1.31B | $1.446B | $1.583B | $1.719B | $1.852B | $1.978B | $2.094B | $2.199B | $21.99B |
| DCF | $911.8M | $889.7M | $861.1M | $826.6M | $787.1M | $743.3M | $696.2M | $646.5M | $595.4M | $543.6M | $5.436B | |
| Value | $12.94B | |||||||||||
In the chart Earnings are multiplied by this value.
Earnings Growth 16%
Earnings Stability 95%
Competitiveness and MOAT
High margins render the company resilient under dire circumstances, hence able to drive competitors out or acquire them. ROE and ROA measure the average flow generated by each invested dollar. Their marginal value is a forecast of future growth, and it is considered by Buffett and Munger the most important single indicator.
| Years | 12-2014 | 12-2015 | 12-2016 | 12-2017 | 12-2018 | 12-2019 | 12-2020 | 12-2021 | 12-2022 | TTM |
|---|---|---|---|---|---|---|---|---|---|---|
| Net Margin | 13% | 14% | 14% | 21% | 17% | 16% | 18% | 19% | 18% | 18% |
| ROA | 7.4% | 8.8% | 8.8% | 8.5% | 7.5% | 7.7% | 7.6% | 7.8% | 6.3% | 7% |
| ROE | 9.5% | 11% | 11% | 15% | 11% | 12% | 12% | 14% | 14% | 14% |
What is the average Net Margin?
The average Net Margin over the past 5 years is +18.1%.
What is the trend of Net Margin?
The trend of Net Margin over the past 5 years is -0.09%.
What is the average Return on Assets (ROA)?
The average ROA over the past 5 years is +7.57%.
What is the trend of Return on Assets (ROA)?
The trend of ROA over the past 5 years is -0.3%.
What is the average Return on Equity (ROE)?
The average ROE over the past 5 years is +13.03%.
What is the trend of Return on Equity (ROE)?
The trend of ROE over the past 5 years is +0.13%.
Safety & Stabiliy
Being debt the number one cause of investment losses and company death, the ratio Debt/FCF is of utmost importance to guarantee safety. On the other hand the Graham’s stability measures the drawdown of earnings, hence indicating the reliability of the flow generated by the company.
| Years | 12-2014 | 12-2015 | 12-2016 | 12-2017 | 12-2018 | 12-2019 | 12-2020 | 12-2021 | 12-2022 | TTM |
|---|---|---|---|---|---|---|---|---|---|---|
| Debt FCF | 3.45 | 3.12 | 3.16 | 2.62 | 2.96 | 2.66 | 3.33 | 2.30 | 5.06 | 4.61 |
| Debt Equity | 0.59 | 0.57 | 0.48 | 0.42 | 0.52 | 0.48 | 0.58 | 0.49 | 0.91 | 0.82 |
| MIN | ||||||||||
| Graham Stability | - | - | 100% | 100% | 100% | 100% | 100% | 100% | 100% | 100% |
What is the Debt/FCF?
The Debt/FCF trailing twelve month is 4.61.
What is the trend of Debt/FCF?
The trend of Debt/FCF over the past 5 years is 0.31.
What is the Graham’s Stability?
Graham’s Stability measure stands at 1.00.
Growth
Growth can be dangerous when forecasting, simply projecting the current growth is in general wrong. A company passes through multiple phases, from being young and unprofitable, to the first periods of profitability and high growth, until it arrives at a period of regime with limited growth. Identifying in which phase the company is in may help forecasting.
| Years | 12-2015 | 12-2017 | 12-2019 | 12-2021 | Trend |
|---|---|---|---|---|---|
| Revenue | 12% | 14% | 14% | 17% | 0.97% |
| Net Income | 16% | 11% | 20% | 15% | 1.4% |
| Stockholders Equity | 12% | 12% | 11% | 9.8% | 0.91% |
| FCF | 11% | 15% | 11% | -7.6% | 1.7% |
What is the 5 year Revenue CAGR?
The Revenue CAGR over the past 5 years is +13.69%.
What is the trend of Revenue growth?
The trend of Revenue growth rate over the past 5 years is +0.97%.
What is the 5 year Earnings CAGR?
The Earnings CAGR over the past 5 years is +11.07%.
What is the trend of Earnings growth?
The trend of Earnings growth rate over the past 5 years is +1.41%.
What is the 5 year Equity CAGR?
The Equity CAGR over the past 5 years is +12.27%.
What is the trend of Equity growth?
The trend of Equity growth rate over the past 5 years is +0.91%.
What is the 5 year FCF CAGR?
The FCF CAGR over the past 5 years is +14.68%.
What is the trend of FCF growth?
The trend of FCF growth rate over the past 5 years is +1.68%.