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Brown & Brown Q3 Earnings Top Estimates on Higher Revenues
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Brown & Brown, Inc.’s (BRO - Free Report) third-quarter 2024 adjusted earnings of 91 cents per share beat the Zacks Consensus Estimate by 4.6%. The bottom line increased 28.2% year over year.
The quarterly results reflected improved organic revenues, driven by higher commission and fees and investment income, expanded EBITDAC margin and increased net investment income, offset by higher expenses.
Brown & Brown, Inc. Price, Consensus and EPS Surprise
Total revenues of $1.2 billion beat the Zacks Consensus Estimate by 2.2%. The top line improved 11% year over year. The upside can be primarily attributed to commission and fees, which grew 10.4% year over year to $1.1 billion. Our estimate for commission and fees growth was 6.8%. The Zacks Consensus Estimate is pegged at $1.1 billion.
Organic revenues improved 9.5% to $1.1 billion in the quarter under review.
Investment income increased 82.3% year over year to $31 million. The Zacks Consensus Estimate for the metric was pegged at $20.6 million and our estimate was $26.8 million.
Adjusted EBITDAC was $414 million, up 11.9% year over year. EBITDAC margin expanded 30 basis points (bps) year over year to 34.9%. Our estimate for adjusted EBITDAC was $406.8 million.
Total expenses increased 0.8% to $869 million due to a rise in employee compensation and benefits, other operating expenses, amortization, depreciation and interest. Our estimate was $825.3 million.
Financial Update of BRO
Brown & Brown exited the third quarter with cash and cash equivalents of $2.7 billion, which increased 17.3% from the 2023-end level.
Long-term debt was $3.4 billion as of Sept. 30, 2024, up 4.3% from the 2023-end level.
Net cash provided by operating activities in the first nine months of 2024 was $813 million, up 15.4% year over year.
Dividend Update
The board of directors paid a regular cash dividend of $111 million in the reported quarter.
Marsh & McLennan Companies, Inc. (MMC - Free Report) reported third-quarter 2024 adjusted earnings per share of $1.63, which beat the Zacks Consensus Estimate by 1.2%. The bottom line advanced 3.8% year over year. Consolidated revenues rose 6% year over year to $5.7 billion. The figure also improved 5% on an underlying basis. The top line, however, fell short of the consensus mark by 0.2%.
Marsh & McLennan’s adjusted operating income was $1.19 billion in the third quarter, which grew 12% year over year but missed our estimate of $1.21 billion.
Arthur J. Gallagher & Co. (AJG - Free Report) reported third-quarter 2024 adjusted net earnings of $2.26 per share, which matched the Zacks Consensus Estimate. The bottom line increased 13% on a year-over-year basis. Total adjusted revenues of $2.7 billion missed the Zacks Consensus Estimate by 0.1%. However, the top line improved 11.1% year over year.
EBITDAC grew 14.3% from the prior-year quarter to $808.8 million.
Aon plc (AON - Free Report) reported third-quarter 2024 adjusted earnings of $2.72 per share, which beat the Zacks Consensus Estimate by 11%. The bottom line advanced 17% year over year. Total revenues of $3.72 billion improved 26% year over year. The top line beat the consensus mark by 0.5%. It consisted of organic revenue growth of 7% and 19% growth from acquisitions.
Revenues are expected to register mid-single-digit or higher organic growth for 2024 and beyond. The company expects the adjusted operating margin to expand in 2024.
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Brown & Brown Q3 Earnings Top Estimates on Higher Revenues
Brown & Brown, Inc.’s (BRO - Free Report) third-quarter 2024 adjusted earnings of 91 cents per share beat the Zacks Consensus Estimate by 4.6%. The bottom line increased 28.2% year over year.
The quarterly results reflected improved organic revenues, driven by higher commission and fees and investment income, expanded EBITDAC margin and increased net investment income, offset by higher expenses.
Brown & Brown, Inc. Price, Consensus and EPS Surprise
Brown & Brown, Inc. price-consensus-eps-surprise-chart | Brown & Brown, Inc. Quote
BRO’s Q3 Details
Total revenues of $1.2 billion beat the Zacks Consensus Estimate by 2.2%. The top line improved 11% year over year. The upside can be primarily attributed to commission and fees, which grew 10.4% year over year to $1.1 billion. Our estimate for commission and fees growth was 6.8%. The Zacks Consensus Estimate is pegged at $1.1 billion.
Organic revenues improved 9.5% to $1.1 billion in the quarter under review.
Investment income increased 82.3% year over year to $31 million. The Zacks Consensus Estimate for the metric was pegged at $20.6 million and our estimate was $26.8 million.
Adjusted EBITDAC was $414 million, up 11.9% year over year. EBITDAC margin expanded 30 basis points (bps) year over year to 34.9%. Our estimate for adjusted EBITDAC was $406.8 million.
Total expenses increased 0.8% to $869 million due to a rise in employee compensation and benefits, other operating expenses, amortization, depreciation and interest. Our estimate was $825.3 million.
Financial Update of BRO
Brown & Brown exited the third quarter with cash and cash equivalents of $2.7 billion, which increased 17.3% from the 2023-end level.
Long-term debt was $3.4 billion as of Sept. 30, 2024, up 4.3% from the 2023-end level.
Net cash provided by operating activities in the first nine months of 2024 was $813 million, up 15.4% year over year.
Dividend Update
The board of directors paid a regular cash dividend of $111 million in the reported quarter.
Zacks Rank
BRO carries a Zacks Rank #3 (Hold) currently. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Peer Releases
Marsh & McLennan Companies, Inc. (MMC - Free Report) reported third-quarter 2024 adjusted earnings per share of $1.63, which beat the Zacks Consensus Estimate by 1.2%. The bottom line advanced 3.8% year over year. Consolidated revenues rose 6% year over year to $5.7 billion. The figure also improved 5% on an underlying basis. The top line, however, fell short of the consensus mark by 0.2%.
Marsh & McLennan’s adjusted operating income was $1.19 billion in the third quarter, which grew 12% year over year but missed our estimate of $1.21 billion.
Arthur J. Gallagher & Co. (AJG - Free Report) reported third-quarter 2024 adjusted net earnings of $2.26 per share, which matched the Zacks Consensus Estimate. The bottom line increased 13% on a year-over-year basis. Total adjusted revenues of $2.7 billion missed the Zacks Consensus Estimate by 0.1%. However, the top line improved 11.1% year over year.
EBITDAC grew 14.3% from the prior-year quarter to $808.8 million.
Aon plc (AON - Free Report) reported third-quarter 2024 adjusted earnings of $2.72 per share, which beat the Zacks Consensus Estimate by 11%. The bottom line advanced 17% year over year. Total revenues of $3.72 billion improved 26% year over year. The top line beat the consensus mark by 0.5%. It consisted of organic revenue growth of 7% and 19% growth from acquisitions.
Revenues are expected to register mid-single-digit or higher organic growth for 2024 and beyond. The company expects the adjusted operating margin to expand in 2024.