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Brown & Brown Unit's Buyout Consolidates Tennessee Presence

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Brown & Brown, Inc. (BRO - Free Report) announced that Brown & Brown of Tennessee, Inc. has bought Frank E. Neal & Co. Agency.

Frank E. Neal & Co. provides commercial, surety, personal and employee benefits insurance solutions for more than 45 years. It caters to entrepreneurs, established businesses and individuals throughout the Southeast region of the United States. It specializes in providing surety bonds and commercial insurance solutions within the construction industry. The addition of Frank E. Neal & Co. will enhance the acquirer’s product portfolio and strengthen its presence in Tennessee.

Brown & Brown and its subsidiaries continuously make strategic acquisitions to expand globally, add capabilities and boost operations. Also, these strategic buyouts help Brown & Brown to increase commissions and fees, which, in turn, drive revenues.

The recent acquisition is the company’s fourth buyout in the ongoing quarter. This apart the company entered into agreements for a couple of more acquisitions.  Brown & Brown’s impressive growth is driven by organic and inorganic means across all segments. Also, strategic acquisitions and mergers help it spread its operations. During the six months ended Jun 30, 2020, it closed 10 transactions with estimated annual revenues of $85 million.

Consistent operational results have been aiding Brown & Brown in generating solid cash flows to be deployed in strategic initiatives. It also has access to sufficient capital via its $800 million available cash to fund growth.

Shares of Brown & Brown have rallied 13.1% year to date against its industry’s decrease of 0.1%. We expect this Zacks Rank #2 (Buy) insurance broker’s sustained operational performance, higher commissions and fees and a sturdy capital position help it retain the momentum.



There have been a number of significant acquisitions in the insurance domain of late. Recently, Arthur J. Gallagher & Co. (AJG - Free Report) acquired Insight Insurance & Risk Management to consolidate its presence in the construction and sports industries.

Other Stocks to Consider

Investors interested in the insurance industry are eHealth (EHTH - Free Report) and RLI Corp (RLI - Free Report) , each sporting Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

eHealth delivered earnings surprise of 138.89% in the last-reported quarter.

RLI delivered earnings surprise of 71.11% in the last-reported quarter.

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