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Brown & Brown (BRO) Unit Acquires Cossio to Boost Operations

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Brown & Brown, Inc. (BRO - Free Report) announced that Brown & Brown of South Carolina, Inc. has acquired Cossio Insurance Agency.

Based in Greenville, SC, Cossio Insurance Agency offers an array of insurance products, focusing on family fun centers, paintball, inflatable rentals and other entertainment/special event products and services. The company generates about $3.5 million in annual revenues.

The company has a track record of serving clients by proving them insurance solutions for unique risks for more than three decades. The addition of Cossio Insurance Agency to Brown & Brown’s portfolio will help it boost its South Carolina operations.

Brown & Brown and its subsidiaries continuously makes strategic acquisitions. Recently, Brown & Brown Insurance Services of California, Inc. purchased Austin & Austin Insurance Services.

The recent acquisition marks its sixth year to date. Last year, the company closed 23 buyouts with annualized revenues of $232 million. In fact, 2018 was the biggest ever in terms of acquisition activity with Hays Companies being the most significant buyout.  Brown & Brown estimates Hays to deliver $210 million to $220 million of annual revenues, $47 million to $53 million of EBITDAC and net income per share of 2 cents to 3 cents in 2019.

Its acquisitions have diversified the insurance broker’s portfolio, ramped up inorganic growth and boosted its margin. Also, these strategic buyouts help Brown & Brown to increase its commissions and fees, which. in turn, is likely to aid revenue growth.

Shares of this Zacks Rank #3 (Hold) insurance broker have gained 5.8% year to date, underperforming its industry’s rally of 15.1%. Nonetheless, we expect the company’s sustained operational performance, higher commissions and fees plus a solid capital position to push the stock higher in the near term.



Other Insurers on an Acquisition Spree

Considering the insurance industry’s sturdy capital level, there has been an array of significant acquisitions in its domain of late. Recently, Cincinnati Financial Corporation (CINF - Free Report) acquired MSP Underwriting Limited. Also, Arthur J. Gallagher & Co. (AJG - Free Report) inked a deal to acquire the global aerospace operations of Jardine Lloyd Thompson Group plc. to consolidate the acquirer’s position in the aviation and aerospace sector. Marsh & McLennan Inc. (MMC - Free Report) announced the acquisition of Employee Benefits Group, Inc by Marsh & McLennan Agency LLC.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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