Brown & Brown Gets Downgraded But Analyst Still Vouches For Long-Term Growth

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].