Investors braced for a bumpy ride ahead of Brown & Brown's (NYS: BRO) earnings announcement as the company has wavered between beating and falling short of analyst predictions during the past fiscal year. The company will unveil its latest earnings on Monday. Brown & Brown operates as an insurance agency, wholesale brokerage, insurance programs, and service organization. It provides its customers with quality, noninvestment insurance contracts, as well as other targeted, customized risk management products.
What analysts say:
Buy, sell, or hold?: Analysts think investors should stand pat on Brown & Brown with 11 of 15 analysts rating it hold. Analysts don't like Brown & Brown as much as competitor Arthur J. Gallagher & Co. overall. Six out of 14 analysts rate Arthur J. Gallagher & Co. a buy compared to four of 15 for Brown & Brown. Analysts still rate the stock a hold, but they are a bit more wary about it compared to three months ago.
Revenue forecasts: On average, analysts predict $256.6 million in revenue this quarter. That would represent a rise of 3.6% from the year-ago quarter.
Wall Street earnings expectations: The average analyst estimate is earnings of $0.31 per share. Estimates range from $0.28 to $0.33.
What our community says:
CAPS All-Stars are solidly backing the stock with 90.4% giving it an outperform rating. The community at large concurs with the All-Stars with 89.4% assigning it a rating of outperform. Fools are bullish on Brown & Brown, though the message boards have been quiet lately with only 53 posts in the past 30 days. Despite the majority sentiment in favor of Brown & Brown, the stock has a middling CAPS rating of three out of five stars.
Brown & Brown's profit has risen year over year by an average of 9.7% over the past five quarters. Revenue has now gone up for three straight quarters.
Now let's look at how efficient management is at running the business. Traditionally, margins represent the efficiency with which companies capture portions of sales dollars. The following table shows net margins over the past four quarters.
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At the time thisarticle was published
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