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Brown & Brown (BRO) Q3 Earnings & Revenues Beat, Up Y/Y

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Brown & Brown, Inc. (BRO - Free Report) reported third-quarter 2021 earnings of 58 cents per share, which beat the Zacks Consensus Estimate by 11.5%. The bottom line increased 11.5% 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

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

Brown & Brown, Inc. price-consensus-eps-surprise-chart | Brown & Brown, Inc. Quote

Behind the Headlines   

Adjusted revenues of $770 million beat the Zacks Consensus Estimate by 1.2%. Moreover, the top line rose 14.2% year over year on higher commissions and fees. Organic revenues increased 8.5% in the reported quarter.

Commissions and fees grew 14.6% year over year to $769.7 million.

Investment income remained unchanged year over year at $0.4 million.

Total expenses increased 11.3% to $573.8 million due to a rise in employee compensation, other operating expenses, amortization, depreciation, interest, and change in estimated acquisition earn-out payables.

EBITDAC was $274.5 million, up 24.3% year over year. EBITDAC margin expanded 280 basis points (bps) to 35.6%.

Financial Update

Brown & Brown exited the third quarter with cash and cash equivalents of $944 million, up about 15.5% from the 2020-end level.

Long-term debt of $1.7 billion as of Sep 30, 2021 was down 13.3% from 2020 end.

Net cash provided by operating activities in the first nine months of 2021 was $627.8 million, up 16.3% year over year.

Dividend Update

The company paid out a cash dividend of 9.3 cents per share in the third quarter.

Zacks Rank

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

Performance of Other Insurers

Of the insurance industry players that have reported third-quarter results so far, RLI Corp. (RLI - Free Report) , The Travelers Companies (TRV - Free Report) and W.R. Berkley Corporation (WRB - Free Report) beat the respective Zacks Consensus Estimate for earnings.

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