5-Star Stocks Poised to Pop: Brown & Brown
By
Brian D. Pacampara
September 18, 2009
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Based on the aggregated intelligence of 140,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, insurance broker Brown & Brown (NYSE: BRO) has earned a coveted five-star ranking.
With that in mind, let's take a closer look at Brown & Brown's business and see what CAPS investors are saying about the stock right now.
Brown & Brown facts
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Headquarters (Founded)
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Daytona Beach, Fla. (1956)
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Market Cap
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$2.74 billion
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Industry
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Insurance brokers
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Trailing-12-Month Revenue
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$989.6 million
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Management
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CEO J. Powell Brown (since July 2009)
COO Jim Henderson (since December 2002)
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Return on Equity (Average, Past 3 Years)
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16.3%
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Dividend Yield
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1.5%
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Other Highly Rated Insurance Stocks
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Berkshire Hathaway (NYSE: BRK-A)
Chubb (NYSE: CB)
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CAPS Members Bullish on BRO Also Bullish on
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Johnson & Johnson (NYSE: JNJ)
Google (Nasdaq: GOOG)
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CAPS Members Bearish on BRO Also Bearish on
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D.R. Horton (NYSE: DHI)
Radian Group (NYSE: RDN)
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Sources: Capital IQ (a division of Standard & Poor's) and Motley Fool CAPS.
On CAPS, 93% of the 126 members who have rated Brown & Brown believe the stock will outperform the S&P 500 going forward. These bulls include TMFmrquakeroats and All-Star Grinnell4Eva, who is ranked in the top 6% of our community.
Just two days ago, TMFmrquakeroats explained how owning the stock would put Fools in fabulous company:
[Sequoia Fund] has owned [Brown & Brown] for several years and it's rated 5 stars. According to Sequoia Fund's managers, [Brown & Brown] did a good job replacing their previous CEO who retired recently. Any company rated 5 stars in CAPS with great long-term prospects that can develop their own managerial talent is worth digging in to.
In a pitch from 2008, Grinnell4Eva expanded on Brown & Brown as a great way to make green:
Brown & Brown is a well-managed company that has weather the soft market better than most. Assuming we're on the tail end of the soft market, I see Brown & Brown gaining organic pricing power in the next year. That said, Brown & Brown has historically grown by acquisition anyway, and smaller agencies and brokerages that are taking a serious hit from soft prices should make for accretive acquisition opportunities in the near term.
What do you think about Brown & Brown, or any other stock for that matter? Make your voice heard on Motley Fool CAPS today. The CAPS community is waiting to hear your opinions. CAPS is 100% free, so get started!
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