A month has gone by since the last earnings report for Brown & Brown (BRO Quick QuoteBRO - Free Report) . Shares have added about 5.5% in that time frame, outperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is Brown & Brown due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.

Brown & Brown's Q2 Earnings, Revenues Top, Rise Y/Y

Brown & Brown, Inc.’s second-quarter 2022 adjusted earnings of 51 cents per share surpassed the Zacks Consensus Estimate as well as the year-ago quarter earnings by 4.1%.

The results reflect improved organic growth and higher commissions and fees, partly offset by higher expenses.

Q2 in Details

Total revenues of $839.7 million outpaced the Zacks Consensus Estimate by 4.4%. The top line improved 15.5% year over year. The upside can primarily be attributed to increased commission and fees, which grew 15.5% year over year to $816.6 million. Organic revenues improved 10.3% to $775.7 million in the quarter under review.

Investment income doubled year over year to $0.4 million. Adjusted EBITDAC was $274.7 million, up 16.9% year over year. EBITDAC margin expanded 30 basis points year over year to 32.7%.

Total expenses increased 18.5% to $640.9 million, courtesy of a rise in employee compensation and benefits, other operating expenses, amortization, depreciation and interest expenses.

Financial Update

Brown & Brown exited second-quarter 2022 with cash and cash equivalents of $2.4 billion, up more than three-fold from the 2021-end level. Long-term debt of $3.5 billion as of Jun 30, 2022 more than doubled from 2021 end. Net cash provided by operating activities in the first half of 2022 was $34.2 million, down 8.9% year over year.

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed an upward trend in estimates review.

VGM Scores

At this time, Brown & Brown has a nice Growth Score of B, though it is lagging a bit on the Momentum Score front with a C. Following the exact same course, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.

Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been broadly trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Brown & Brown has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.

Performance of an Industry Player

Brown & Brown is part of the Zacks Insurance - Brokerage industry. Over the past month, Marsh & McLennan (MMC Quick QuoteMMC - Free Report) , a stock from the same industry, has gained 7.1%. The company reported its results for the quarter ended June 2022 more than a month ago.

Marsh & McLennan reported revenues of $5.38 billion in the last reported quarter, representing a year-over-year change of +7.2%. EPS of $1.89 for the same period compares with $1.75 a year ago.

For the current quarter, Marsh & McLennan is expected to post earnings of $1.16 per share, indicating a change of +7.4% from the year-ago quarter. The Zacks Consensus Estimate has changed -0.3% over the last 30 days.

Marsh & McLennan has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of C.