April 17, 2025 a 02:46 pm
BRO: Dividend Analysis - Brown & Brown, Inc.
Brown & Brown, Inc. has consistently proven its reliability as a dividend-paying stock, with an impressive track record spanning nearly four decades. The company boasts a modest dividend yield of 0.52%, showcasing its commitment to shareholder value through stable and consistent payouts. Despite its relatively low yield, the sustained growth in dividends over time reflects a strong underlying business model and prudent financial management.
📊 Overview
Brown & Brown operates within the insurance sector, renowned for its robustness in dividend offerings. The stability of a 0.52% dividend yield, coupled with a current dividend of $0.55 per share, and an impressive 39-year streak without significant cuts, highlights its status as a reliable dividend provider.
| Metric | Value |
|---|---|
| Sector | Insurance |
| Dividend yield | 0.52% |
| Current dividend per share | $0.55 |
| Dividend history | 39 years |
| Last cut or suspension | None |
🗣️ Dividend History
Examining the dividend history highlights the company's commitment to returning value to shareholders. A consistent increase in dividend payments reflects a robust financial health.
| Year | Dividend per Share (USD) |
|---|---|
| 2025 | 0.15 |
| 2024 | 0.54 |
| 2023 | 0.475 |
| 2022 | 0.4225 |
| 2021 | 0.38 |
📈 Dividend Growth
The growth rates over 3 and 5 years indicate a moderate yet steady increase in dividends, showcasing the company's strategic planning and financial health.
| Time | Growth |
|---|---|
| 3 years | 12.43% |
| 5 years | 10.69% |
The average dividend growth is 10.69% over 5 years. This shows moderate but steady dividend growth.
📉 Payout Ratio
A low dividend payout ratio indicates that the company retains a substantial part of its earnings while still rewarding shareholders.
| Key figure | Ratio |
|---|---|
| EPS-based | 15.55% |
| Free cash flow-based | 14.33% |
The low payout ratios of 15.55% (EPS) and 14.33% (FCF) suggest that Brown & Brown maintains a conservative approach to dividend payments, aligning with long-term financial stability and growth potential.
✅ Cashflow & Capital Efficiency
Strong free cash flow supports dividends and growth investments, critical for sustainabilty. Brown & Brown’s metrics provide insight into operational efficiency and funding capabilities.
| Metric | 2024 | 2023 | 2022 |
|---|---|---|---|
| Free Cash Flow Yield | 4.08% | 4.71% | 5.23% |
| Earnings Yield | 3.45% | 4.35% | 4.24% |
| CAPEX to Operating Cash Flow | 0% | 6.83% | 5.97% |
| Stock-based Compensation to Revenue | 2.15% | 2.13% | 1.86% |
| Free Cash Flow / Operating Cash Flow Ratio | 1.00 | 0.93 | 0.94 |
The company's cash flow metrics indicate efficient capital deployment and a solid ability to cover financial obligations, sustaining their dividend policy.
📊 Balance Sheet & Leverage Analysis
Leverage ratios reflect a low-risk profile, with debt levels well-managed compared to equity and assets. This ensures operational flexibility.
| Metric | 2024 | 2023 | 2022 |
|---|---|---|---|
| Debt-to-Equity | 6.43% | 72.05% | 89.83% |
| Debt-to-Assets | 2.35% | 27.01% | 29.61% |
| Debt-to-Capital | 6.04% | 41.88% | 47.32% |
| Net Debt to EBITDA | -0.15 | 2.25 | 2.84 |
| Current Ratio | 1.10 | 1.03 | 1.09 |
| Quick Ratio | 1.10 | 1.03 | 1.09 |
| Financial Leverage | 2.74 | 2.67 | 3.03 |
Brown & Brown's prudent balance sheet decisions highlight a strong financial foundation, improving its capacity to navigate potential market fluctuations.
📊 Fundamental Strength & Profitability
High returns on equity and assets depict an efficient management team, while solid margins indicate robust profitability.
| Metric | 2024 | 2023 | 2022 |
|---|---|---|---|
| Return on Equity | 15.43% | 15.60% | 14.58% |
| Return on Assets | 5.64% | 5.85% | 4.81% |
| Net Profit Margin | 21.11% | 20.73% | 18.85% |
| EBIT Margin | 31.97% | 31.99% | 28.75% |
| EBITDA Margin | 36.68% | 35.12% | 34.49% |
| Gross Margin | 48.86% | 47.93% | 49.01% |
| Research & Development to Revenue | 0% | 0% | 0% |
The stable returns and strong margins affirm Brown & Brown’s capability to generate substantial profits, underpinning future dividend potential.
📉 Price Development
✅ Dividend Scoring System
Brown & Brown's dividends are evaluated based on several key performance indicators, reflecting the overall health and sustainability of their dividend policy.
| Criteria | Score | Indicator |
|---|---|---|
| Dividend yield | 2 | |
| Dividend Stability | 5 | |
| Dividend growth | 3 | |
| Payout ratio | 5 | |
| Financial stability | 4 | |
| Dividend continuity | 5 | |
| Cashflow Coverage | 4 | |
| Balance Sheet Quality | 4 |
Total Score: 32 out of 40
Rating
Brown & Brown, Inc. demonstrates a robust dividend policy, underpinned by substantial financial metrics and stability. Its moderate growth, combined with an enviable continuity record, renders Brown & Brown a compelling choice for dividend investors seeking reliability and long-term income potential.