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Brown & Brown (BRO) Q2 Earnings & Revenues Beat, Up Y/Y

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Brown & Brown, Inc. (BRO - Free Report) reported second-quarter 2019 earnings of 32 cents per share, which beat the Zacks Consensus Estimate by 14.3%. The bottom line improved 23.1% year over year.

The results reflect recent acquisitions, improved organic growth and margin expansion.

Behind the Headlines    

Adjusted revenues of $575.2 million beat the Zacks Consensus Estimate by 3.3%. Moreover, the top line rose 21.6% year over year on higher commissions and fees plus net investment income. Organic revenues increased 3.9% in the reported quarter.

Commissions and fees grew 21.4% year over year to $572.9 million.

Investment income surged 114.3% year over year to $1.5 million.

Total expenses increased 21.4% to $451.7 million, driven by a rise in employee compensation and benefits as well as other operating expenses and interest expense.

EBITDAC was $168.6 million, up 22.4% year over year. EBITDAC margin expanded 20 basis points year over year to 29.3%.

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

Financial Update

Brown & Brown exited the second quarter of 2019 with cash and cash equivalents of $814.8 million, up 4.8% from 2018-end level.

Long-term debt of $1.4 billion as of Jun 30, 2019 was down 2% from 2018 end.

Net cash provided by operating activities in the first six months of 2019 was $305.7 million, up 10.2% year over year.

Dividend Update

The company paid cash dividend of 8 cents per share in the second quarter.

Acquisition Update

Brown & Brown closed four acquisitions in the reported quarter.

Zacks Rank

Brown & Brown currently has a Zacks Rank #3 (Hold).

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 second-quarter results so far, The Progressive Corporation (PGR - Free Report) and RLI Corp. (RLI - Free Report) beat the respective Zacks Consensus Estimate for earnings.

Upcoming Release

Arthur J. Gallagher & Co. (AJG - Free Report) will release second-quarter 2019 earnings on Jul 25. The Zacks Consensus Estimate for earnings per share stands at 61 cents, suggesting 1.6% decrease from the year-ago reported figure.

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