Brown & Brown

Methodology

Brown & Brown's insurance brokerage business generates predictable commission and fee revenue with less volatility than underwriting-based insurers. The company's focus on small and mid-sized commercial clients plus strategic acquisitions drives steady growth. This fair value calculation works well for Brown & Brown given recurring revenue characteristics and consistent execution on M&A strategy that has compounded value steadily over decades.

Methodology

Brown & Brown's PEG ratio typically ranges from 2.0-3.0, reflecting premium valuations for a consistent insurance broker with reliable double-digit earnings growth from organic gains and acquisitions. The company's disciplined M&A approach in a fragmented market justifies higher multiples than larger brokers with fewer acquisition opportunities. Compare to peers like Gallagher and Aon to assess whether Brown & Brown's execution track record and growth runway command appropriate premiums.

Methodology

Brown & Brown's modest dividend yield (around 0.8-1.5%) plays a supporting role to growth from organic expansion and acquisitions. The company prioritizes capital deployment toward accretive acquisitions while maintaining steady dividend growth. PEGY adds some context for total return assessment, though for a growth-oriented broker like Brown & Brown, M&A execution and organic growth matter more than dividend-adjusted metrics given the modest yield.