Company Performance - Brown & Brown (BRO) has gained approximately 19% year-to-date, significantly outperforming the Finance sector, which has returned an average of 4.3% [4] - The Zacks Consensus Estimate for BRO's full-year earnings has increased by 1.9% over the past quarter, indicating improving analyst sentiment and a positive earnings outlook [3] - Brown & Brown is part of the Insurance - Brokerage industry, which has an average year-to-date gain of 12.4%, further highlighting BRO's strong performance [5] Industry Context - The Finance group, which includes 867 companies, currently ranks 2 within the Zacks Sector Rank, reflecting the overall strength of the sector [2] - The Insurance - Brokerage industry, which includes Brown & Brown, is ranked 27 in the Zacks Industry Rank [5] - In contrast, the Financial - Miscellaneous Services industry, which includes Pagaya Technologies Ltd. (PGY), is ranked 31 and has declined by 5.3% year-to-date [6]

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Core Viewpoint - Morgan Stanley analyst Bob Jian Huang downgraded Brown & Brown, Inc. from Overweight to Equal-weight, maintaining a price forecast of $128, citing strong year-to-date stock performance as a limiting factor for attractiveness [1]. Company Performance - Brown & Brown's stock has increased approximately 16% year-to-date, making it the top performer among Property & Casualty (P&C) brokers in the coverage, driven by strong fourth-quarter results and sustained momentum [2]. - The company is expected to achieve mid to high single-digit organic top-line growth in 2025 and 2026, primarily supported by its Programs and Wholesale Brokerage segments [2]. Financial Metrics - The company is projected to maintain an industry-leading Adjusted EBITDAC margin in the mid-30s for both 2025 and 2026, indicating strong and stable growth [3]. - The downgrade is attributed to the company gradually earning into its current valuation, although the analyst believes that the fundamentals will surpass those of peers in the long term [3]. Investment Opportunities - Investors can gain exposure to Brown & Brown's stock through the Motley Fool Mid-Cap Growth ETF (TMFM) and Guru Favorite Stocks ETF (GFGF) [3].

Core Viewpoint - Brown & Brown, Inc. (BRO) demonstrates strong investor confidence with its stock trading near a 52-week high, indicating potential for further price appreciation and solid upward momentum as it trades above key moving averages [1] Financial Performance - Earnings have grown 21.5% over the past five years, surpassing the industry average of 13.7%, with the company consistently beating earnings estimates in the last four quarters, averaging a surprise of 8.18% [2] - The Zacks Consensus Estimate for 2025 earnings per share indicates an 8.8% year-over-year increase, with revenues projected at $5.21 billion, reflecting an 8.4% improvement [3] Analyst Sentiment - All seven analysts covering BRO have raised their estimates for 2025, with three also increasing estimates for 2026, leading to a 2.2% and 1.8% upward revision in the Zacks Consensus Estimates for 2024 and 2025, respectively [4] Stock Performance - BRO shares have gained 12.5% year-to-date, outperforming the industry growth of 10.6%, the Finance sector's return of 4.4%, and the Zacks S&P 500 composite's rise of 1% [5][6] Key Growth Drivers - The main revenue drivers include commissions and fees, benefiting from new business growth, strong retention rates, and continued rate increases across most coverage lines, achieving an intermediate annual revenue goal of $4 billion [7] - Strategic acquisitions have allowed BRO to capitalize on market opportunities, enhance its product and service portfolio, and expand its global reach, completing 32 acquisitions in 2024 [8][9] Capital Management - BRO maintains a strong liquidity position with an improving leverage ratio, ensuring effective cash deployment for acquisitions, capital expenditures, and shareholder dividends, having increased dividends for the last 30 years at a five-year CAGR of 8.7% [9][10]

Core Viewpoint - Brown & Brown's recent earnings report shows strong performance with adjusted earnings and revenue growth, indicating positive momentum leading up to the next earnings release [2][3][6]. Financial Performance - Q4 2024 adjusted earnings were 86 cents per share, exceeding the Zacks Consensus Estimate by 14.7% and reflecting a year-over-year increase of 48.3% [2]. - Total revenues for Q4 reached $1.2 billion, surpassing the Zacks Consensus Estimate by 6.4% and showing a 15.4% year-over-year improvement [3]. - Commission and fees grew 15.4% year over year to $1.1 billion, contributing significantly to revenue growth [3]. - Investment income rose 22.2% year over year to $22 million, although it fell short of internal estimates [4]. - Adjusted EBITDAC for Q4 was $390 million, up 22.6% year over year, with an EBITDAC margin expansion of 190 basis points to 32.9% [4]. Expense Analysis - Total expenses increased by 35.72% to $909 million, driven by higher employee compensation and other operational costs [5]. Full-Year Highlights - For the full year, adjusted earnings were $3.25 per share, missing the Zacks Consensus Estimate of $4.73 per share, but still reflecting an 81.2% year-over-year increase [6]. - Total revenues for the year were $4.8 billion, exceeding the Zacks Consensus Estimate and improving 12.9% year over year [6]. - Adjusted EBITDAC for the full year increased 17% to $1.7 billion, with a margin expansion of 130 basis points to 35.2% [6]. Financial Position - As of the end of 2024, cash and cash equivalents stood at $2.5 billion, an 8.6% increase from the previous year [7]. - Long-term debt was reported at $4 billion, up 11.5% from the end of 2023 [7]. - Net cash provided by operating activities in 2024 was $1.6 billion, reflecting a 16.2% year-over-year increase [7]. Dividend Information - The board of directors declared a regular cash dividend of $154 million during the reported quarter [8]. Market Sentiment - There has been an upward trend in estimates revisions for Brown & Brown, indicating positive market sentiment [9]. - The stock currently holds a Zacks Rank 3 (Hold), suggesting an expectation of in-line returns in the coming months [12].

Core Insights - Brown & Brown, Inc. has appointed Stephen P. Hearn as executive vice president and chief operating officer, effective immediately, following his resignation from the board of directors [1][2] - Hearn brings 35 years of experience in the insurance industry and will focus on scaling operations, fostering innovation, and developing talent within the company [2][3] - The company aims to achieve an interim revenue goal of $8 billion, leveraging Hearn's expertise to drive operational excellence and identify potential acquisitions [3] Company Overview - Brown & Brown, Inc. is a leading insurance brokerage firm established in 1939, with over 500 locations and a workforce of more than 17,000 professionals [5] - The company is dedicated to providing customer-centric risk management solutions and innovative strategies to support clients throughout their growth journey [5] Leadership Background - Stephen P. Hearn has held various leadership roles in the insurance sector, including CEO positions at The Ardonagh Group and Corant Global, and has extensive experience with Willis Group Holdings [4] - His previous roles include significant positions in reinsurance broking and insurance brokerage, showcasing a strong background in the industry [4]

Core Insights - Brown & Brown, Inc. has appointed Stephen P. Hearn as executive vice president and chief operating officer, effective immediately, following his resignation from the board of directors [1][2] - Hearn brings 35 years of experience in the insurance industry and will focus on scaling operations, fostering innovation, and developing talent within the company [2][3] - The company aims to reach an interim revenue goal of $8 billion, leveraging Hearn's expertise to drive operational excellence and identify potential acquisitions [3] Company Overview - Brown & Brown, Inc. is a leading insurance brokerage firm established in 1939, with over 500 locations and a workforce of more than 17,000 professionals [5] - The company is dedicated to providing customer-centric risk management solutions and innovative strategies to support clients throughout their growth journey [5] Leadership Background - Stephen P. Hearn has held various leadership roles in the insurance sector, including CEO positions at The Ardonagh Group and Corant Global, and has extensive experience with Willis Group Holdings [4] - His previous roles include significant positions in reinsurance broking and insurance brokerage, showcasing a strong background in the industry [4]

Financial Performance - The Company reported total revenues of $4,703 million in 2024, up from $4,199 million in 2023, representing a year-over-year increase of approximately 12% [21]. - In 2024, the Retail segment generated $2,720 million in commissions, accounting for 57.8% of total commissions, while the Programs segment contributed $1,375 million (29.2%) and the Wholesale Brokerage segment $610 million (13.0%) [21]. - International operations generated $665 million in revenues in 2024, compared to $527 million in 2023 and $240 million in 2022, indicating significant growth in foreign markets [21]. Workforce and Employment - As of December 31, 2024, the Retail segment employed 10,962 employees, while the Programs segment had 3,986 employees, reflecting the Company's workforce size [25][26]. - As of December 31, 2024, the Wholesale Brokerage segment employed 2,026 employees and operates in 24 states plus Belgium, Hong Kong, Italy, and the United Kingdom [31]. - Brown & Brown expanded its team by nearly 1,000 teammates through 32 acquisitions in 2024 [45]. - Approximately 56% of U.S. teammates own stock in the company, fostering an ownership culture [42]. - In 2024, 94% of teammates rated Brown & Brown a Great Place to Work® [47]. Customer Relationships - The Retail segment's largest customer accounted for only 0.7% of its total commissions and fees, demonstrating a diversified customer base [24]. - The Programs segment's largest customer represented approximately 12.7% of its total commissions and fees, highlighting key client relationships [26]. - The Company emphasizes the importance of maintaining relationships with insurance carriers, as changes could impact market share and commissions [13]. Strategic Initiatives - The Company is focused on expanding its market presence and enhancing its service offerings through strategic acquisitions and partnerships [13]. - The company has been involved in business development strategies, product expansion, and acquisitions since 2003, indicating a focus on growth and market expansion [72]. Health and Safety - There were no work-related fatalities and 17 injuries or occupational diseases reported in 2024 [60]. - The company emphasizes holistic well-being, providing access to mental health resources and support services for teammates [51]. - The company has a commitment to diversity, with 11 Teammate Resource Groups established to support various identities [49]. Benefits and Compensation - The company offers comprehensive benefits, including medical, dental, disability, life insurance, and 401(k) plans, with no widespread layoffs or pay cuts in 2024 [46]. - The company is piloting a caregiving services program, with a global rollout anticipated in 2026 if successful [54]. Financial Liabilities and Risks - As of December 31, 2024, the company had $1,006 million outstanding under the Second Amended and Restated Credit Agreement and the Loan Agreement tied to the Secured Overnight Financing Rate (SOFR) [291]. - The company is subject to interest rate risk due to its floating interest rate agreements, but a 10% change in interest rates would not have a material effect on the financial statements [291]. - The fair value of the company's invested assets at December 31, 2024, approximated their carrying values due to their short-term duration, indicating minimal market risk [289]. - The company does not actively invest or trade in equity securities and generally disposes of any equity securities received from acquisitions shortly after the acquisition date [290]. - Estimated earn-out payables for acquisitions not denominated in U.S. dollars include $167 million, with five acquisitions having no maximum potential earn-out amount [293]. - The company has a current liability of approximately $43 million for a dividend of $0.1500 per share approved on January 22, 2025, to be paid on February 12, 2025 [293]. - Approximately $90 million is reflected in accounts payable related to federal income tax payments due to Hurricane Milton tax relief, with payments due by May 1, 2025 [293]. - The company is exposed to translational exchange rate risk with operations in British pounds, Canadian dollars, and euros, but a 10% hypothetical change in foreign currency exchange rates would not materially affect the financial statements [292]. - The majority of international operations do not have material transactions in currencies other than their functional currency, limiting transactional currency rate risk [292].

Brown & Brown, Inc.’s (BRO) fourth-quarter 2024 adjusted earnings of 86 cents per share beat the Zacks Consensus Estimate by 14.7%. The bottom line increased 48.3% year over year.See the Zacks Earnings Calendar to stay ahead of market-making news.The quarterly results reflected improved organic revenues, driven by higher commission and fees and investment income and expanded EBITDAC margin, offset by higher expenses.Shares gained 1.9% in after-market trading to reflect the outperformance.BRO’s Q4 DetailsTot ...

Financial Performance - Fourth Quarter 2024 - Total revenue increased by 154% reaching $1184 million[9, 20] - Organic revenue grew by 138% to $1078 million[10, 20] - Adjusted diluted net income per share increased by 246% to $086[10, 20] - EBITDAC Margin - Adjusted increased 190bps to 329%[10, 20] Financial Performance - Full Year 2024 - Total revenue increased by 129% reaching $4805 million[12, 39] - Organic revenue grew by 104% to $4393 million[13, 39] - Adjusted diluted net income per share increased by 182% to $384[13, 39] - EBITDAC Margin - Adjusted increased 130bps to 352%[13, 39] Segment Performance - Fourth Quarter 2024 - Programs segment organic revenue growth was 386%[18] - Wholesale Brokerage segment organic revenue growth was 71%[18] - Retail segment organic revenue growth was 44%[18]