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Brown & Brown (BRO) Q2 Earnings & Revenues Beat Estimates

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Brown & Brown, Inc. (BRO - Free Report) second-quarter 2021 adjusted earnings of 49 cents per share beat the Zacks Consensus Estimate by 22.5%. The bottom line also improved 44.1% year over year.

Higher commissions and fees drove the company’s results, partly offset by increased expenses.

Brown & Brown, Inc. Price, Consensus and EPS Surprise

Q2 in Details

Total revenues of $727 million outpaced the Zacks Consensus Estimate by 5.7%.  Moreover, the top line improved 21.4% year over year. The upside can primarily be attributed to improved commission and fees, and high organic growth.

Commissions and fees grew 21.3% year over year to $725.9 million. Organic revenues increased 14.7% to $658.4 million in the quarter under review.

Investment income plunged 33.3% year over year to $0.2 million.

EBITDAC was $239.3 million, up 35.4% year over year. EBITDAC margin expanded 340 basis points (bps) year over year to 32.9%.

Total expenses increased 15.2% to $541 million, courtesy of a rise in employee compensation and benefits, other operating expenses, amortization, depreciation and interest.

Financial Update

Brown & Brown exited second-quarter 2021 with cash and cash equivalents of $850.2 million, up 4% from 2020-end level.

Long-term debt of $1.7 billion as of Jun 30, 2021 was down 13% from 2020 end.

Net cash provided by operating activities in the first half of 2021 was $466.3 million, up 11.9% year over year.

Dividend Update

On Jul 21, Brown & Brown declared cash dividend of 9.25 cents per share. The dividend will be paid out on Aug 18, 2021 to shareholders of record as of Aug 11.

Zacks Rank & Performance of Other Insurers

Brown & Brown currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Among other insurance industry players, which have reported second-quarter earnings so far, the bottom line of The Progressive Corporation (PGR - Free Report) , RLI Corp. (RLI - Free Report) and The Travelers Companies, Inc. (TRV - Free Report) beat the respective Zacks Consensus Estimate.