Brown & Brown (BRO)
Financials · $23.4B market cap · SEC CIK 0000079282
ahead of 55% of the S&P 500 · #38 of 76 in Financials
Next reports on Jan 25, 2027, after the close, with analysts expecting $0.90 in earnings per share.
52-week range $53.81 to $82.58. 13% below its 52-week high and 34% above its low.
The case for BRO
- Revenue up 26.1% on the year.
- Has compounded revenue at 17.7% a year over five years.
- Moves less than the market (beta 0.51).
The case against
- Trailed the S&P 500 by 22 points over the past year.
- Weakest against its peers: return on equity of 10% is lower than 78% of Financials companies.
What the score is made of
Each factor is half a curve over reported figures and half a rank among the other Financials companies (momentum is judged against fixed thresholds only), and the five are blended by weight. The score is where that blend places it in the S&P 500. It describes the last filing and the current price. It is not a forecast.
| Valuewhat you pay for the earnings and cash, against the growth you get | 56 |
|---|---|
| Growthhow fast revenue and earnings are moving, this year and over five | 79 |
| Profitabilityhow much of the revenue becomes profit, and how much of that is cash | 46 |
| Momentumhow the price has behaved lately | 48 |
| Stabilityhow violently it moves, what it owes and what it pays you | 59 |
- Its debt and cash flow are not scored, as for every company in the Financials sector: for banks, insurers and brokers, borrowing is the business.
- Each factor except momentum is half fixed thresholds, half rank among the 76 Financials companies.
The financials
Revenue growth
Is the business growing? Yes
| Last 12 months | +26.1% |
|---|---|
| Over 5 years | +17.7% a year |
| FY2025 revenue | $5.9B (+23%) |
Free cash flow
Is it generating real cash? Not meaningful for a financial company
Profit margins
Is profitability improving? No, slipping
| Gross margin | n/a |
|---|---|
| Operating margin | 28% |
| Net margin, FY24 → FY25 → now | 20.7% → 17.9% → 17.6% |
Debt vs. cash
Is the balance sheet healthy? Not judged for a financial company
| Cash | $1.1B |
|---|---|
| Long-term debt | $6.9B |
| Net debt | $5.8B |
Valuation
Is the stock price reasonable? Yes, about fair
| P/E | 19.2× |
|---|---|
| Fair P/E for its growth | 24× |
| Forward P/E | 14.0× |
| EV / EBITDA | 12.1× |
At 19.2× earnings it trades below the 24× that 10%+ a year of growth plus a 0.7% dividend would justify. It is judged on earnings alone: its book value is not what it earns on, as it would be for a bank or insurer.
The financials, five years deep
Pulled from Brown & Brown's XBRL filings on SEC EDGAR. Italic rows are worked out from the others.
| FY2025 | FY2024 | FY2023 | FY2022 | FY2021 | |
|---|---|---|---|---|---|
| Revenue growth | |||||
| Revenue | $5.9B | $4.8B | $4.3B | $3.6B | $3.1B |
| Change on the year | +23% | +13% | +19% | +17% | — |
| Free cash flow | |||||
| Free cash flow | $1.4B | $1.1B | $941M | $829M | $764M |
| Of revenue | 23% | 23% | 22% | 23% | 25% |
| Profit margins | |||||
| Net margin | 17.9% | 20.7% | 20.5% | 18.8% | 19.2% |
| Debt vs. cash | |||||
| Cash | $1.1B | $675M | $700M | $650M | $693M |
| Long-term debt | $6.9B | $3.6B | $3.2B | $3.7B | $2.0B |
| Net cash (debt) | −$5.8B | −$2.9B | −$2.5B | −$3.0B | −$1.3B |
Risk factors BRO lists in its 10-K
- Our F&I businesses may be negatively impacted by a slowdown in vehicles sales in the united states or by regulatory changes, including tax-related changes, affecting the sale of f&I products by vehicle dealers
- changes in, or the termination of, certain programs administered by the U.s. federal government from which we derive revenues could adversely impact our results of operations
- If we are not able to successfully attract, retain, develop and motivate our employees, our business, financial results and reputation could be materially and adversely affected
- Our success and future performance depend in part upon the continued services of our executive officers, senior management, and other highly skilled personnel
- This risk may be increased by remote or hybrid working arrangements, which may make our employees more vulnerable to solicitations by competing firms
- We may be unable to retain our employees if we do not offer employment terms that are competitive with the rest of the labor market
- Our employees have been, and may continue to be, subject to poaching efforts by our competitors
- Similarly, if an employee joins us from a competitor and is subject to enforceable restrictive covenants, we may be delayed in optimizing the employee’s potential
- Our key personnel, including our executive officers, may be subject to targeted cybersecurity or physical threats, which, if realized, could adversely affect our business
- Further, the advance of generative artificial intelligence (“AI”) may give rise to additional vulnerabilities and potential entry points for cyber threats