Teacher Retirement System of Texas Trims Stake in Brown & Brown, Inc. $BRO

Teacher Retirement System of Texas decreased its holdings in shares of Brown & Brown, Inc. (NYSE:BRO) by 44.8% in the 3rd quarter, according to its most recent Form 13F filing with the SEC. The firm owned 40,312 shares of the financial services provider’s stock after selling 32,775 shares during the period. Teacher Retirement System of Texas’ holdings in Brown & Brown were worth $3,781,000 as of its most recent SEC filing.

Other hedge funds and other institutional investors also recently modified their holdings of the company. Darwin Wealth Management LLC bought a new stake in Brown & Brown during the second quarter valued at approximately $30,000. Motco purchased a new stake in shares of Brown & Brown during the 2nd quarter valued at $32,000. TD Private Client Wealth LLC lifted its holdings in shares of Brown & Brown by 39.3% during the 2nd quarter. TD Private Client Wealth LLC now owns 436 shares of the financial services provider’s stock worth $48,000 after acquiring an additional 123 shares during the last quarter. Migdal Insurance & Financial Holdings Ltd. purchased a new position in Brown & Brown in the second quarter worth $49,000. Finally, Horizon Bancorp Inc. IN bought a new position in Brown & Brown in the second quarter valued at $50,000. Hedge funds and other institutional investors own 71.01% of the company’s stock.

Brown & Brown News Summary

Here are the key news stories impacting Brown & Brown this week:

• Positive Sentiment: Adjusted earnings and operating performance: Brown & Brown reported Diluted Net Income Per Share — Adjusted of $0.93 (up YoY) and higher EBITDAC / adjusted margins, which beat some expectations and supports the company’s operating story. Zacks: Q4 Earnings Beat
• Positive Sentiment: Strong top?line (acquisition?driven) growth: Total revenues rose ~35.7% YoY to about $1.6B, driven largely by acquisitions (Accession/RSC) which materially increased scale and fee income. Press Release
• Neutral Sentiment: Earnings call/transcript available — management reiterated growth from acquisitions but signaled margin pressure and integration items; read the call highlights and transcript for management tone and any forward comments. TipRanks: Call Highlights
• Neutral Sentiment: Investor commentary/valuation views: Some value?oriented writeups see a deeper discount after the pullback, noting long?term strengths in the brokerage model. Seeking Alpha
• Neutral Sentiment: Company news: the firm announced the passing of its Chief Legal Officer — a human resources / governance item investors will note but is not a primary driver of the price move. Press Release
• Negative Sentiment: Revenue shortfall vs. Street: Reported revenue (~$1.61B) came in below several consensus estimates (~$1.65–1.67B), prompting the immediate market reaction and headlines that shares fell on a revenue miss. MarketWatch
• Negative Sentiment: Weak organic growth and GAAP EPS compression: Organic revenue declined ~2.8% in Q4 and GAAP diluted EPS fell to $0.59 (year?over?year decline), which raises concern about core?business momentum absent acquisitions. Quiver / Press Summary
• Negative Sentiment: Higher leverage and integration costs: The Accession acquisition added goodwill, intangibles and long?term debt; investors are weighing integration costs, acquisition earn?outs and higher interest expense. Reuters
• Negative Sentiment: Analyst reactions: Banks trimmed targets/ratings (Barclays lowered to $82 / equal?weight; Bank of America cut target to $90 / neutral), which adds near?term selling pressure. Benzinga: Analyst Moves

Analysts Set New Price Targets

BRO has been the subject of several research analyst reports. UBS Group dropped their price target on Brown & Brown from $120.00 to $106.00 and set a “neutral” rating for the company in a research note on Wednesday, October 8th. Mizuho set a $89.00 target price on Brown & Brown and gave the stock a “neutral” rating in a research report on Monday, December 15th. Raymond James Financial reiterated an “outperform” rating on shares of Brown & Brown in a research report on Monday, November 3rd. Wolfe Research started coverage on shares of Brown & Brown in a research note on Thursday, November 20th. They set a “peer perform” rating on the stock. Finally, Bank of America lowered their price objective on shares of Brown & Brown from $94.00 to $90.00 and set a “neutral” rating for the company in a report on Tuesday. Four equities research analysts have rated the stock with a Buy rating, fourteen have assigned a Hold rating and one has assigned a Sell rating to the company. According to data from MarketBeat, Brown & Brown has an average rating of “Hold” and a consensus price target of $98.13.

Brown & Brown Trading Down 6.9%

NYSE:BRO opened at $74.09 on Wednesday. The company has a fifty day moving average of $79.74 and a 200 day moving average of $87.88. Brown & Brown, Inc. has a 52 week low of $73.10 and a 52 week high of $125.68. The company has a quick ratio of 2.10, a current ratio of 2.10 and a debt-to-equity ratio of 0.62. The firm has a market capitalization of $25.30 billion, a P/E ratio of 23.15, a P/E/G ratio of 1.86 and a beta of 0.81.

Brown & Brown (NYSE:BRO) last announced its quarterly earnings results on Monday, January 26th. The financial services provider reported $0.93 earnings per share (EPS) for the quarter, topping analysts’ consensus estimates of $0.91 by $0.02. The business had revenue of $1.61 billion for the quarter, compared to analyst estimates of $1.65 billion. Brown & Brown had a net margin of 17.84% and a return on equity of 13.65%. The company’s revenue was up 35.7% on a year-over-year basis. During the same quarter last year, the firm earned $0.86 EPS. On average, research analysts predict that Brown & Brown, Inc. will post 4.18 earnings per share for the current year.

Brown & Brown Dividend Announcement

The firm also recently declared a quarterly dividend, which will be paid on Wednesday, February 11th. Investors of record on Wednesday, February 4th will be paid a $0.165 dividend. The ex-dividend date of this dividend is Wednesday, February 4th. This represents a $0.66 dividend on an annualized basis and a yield of 0.9%. Brown & Brown’s dividend payout ratio (DPR) is presently 19.76%.

Brown & Brown Profile

Brown & Brown, Inc (NYSE: BRO) is a professional insurance brokerage and risk advisory firm that provides a broad range of property and casualty, employee benefits, personal risk, and specialty insurance products. The company works with commercial, public sector and individual clients to design and place insurance programs, manage claims and loss control, and deliver risk management consulting. Its services also include wholesale brokerage, program administration and other specialty distribution solutions that connect carriers and intermediaries to niche markets.

Brown & Brown operates through a decentralized model of operating units and subsidiaries, enabling local client service with the scale to access national and specialty markets.