On Jan 17, Zacks Investment Research upgraded
Brown & Brown Inc.
) to a Zacks Rank #3 (Hold) from a Zacks Rank #4 (Sell) following
the acquisition of The Wright Insurance Group, LLC. The
acquisition will enable Brown & Brown to be a part of the
national flood insurance program (NFIP), and serve as a premier
service provider to the government-sponsored insurance programs
and proprietary national and regional programs.
Why the Upgrade?
Early this month, Brown & Brown inked a merger deal to
acquire The Wright Insurance Group, LLC for a total net
consideration of $602.5 million. The company expects the entire
transaction to close by Apr 2014.
Brown & Brown has undertaken several acquisitions in the
recent past to augment its wide range of insurance product and
service portfolio as well as leverage its client base. These
initiatives should aid the company's earnings performance going
Some of its latest acquisitions include certain assets of O'Neil
Financial Services, Agency Services Consolidated Inc., Preserve
Extended Protection Plan Inc. as well as some assets of ICA, Inc.
The acquisitions at Brown & Brown are primarily supported by
its strong balance sheet and its ability to generate healthy cash
flow, which in turn, is owing to its continued solid operational
performance across all four business divisions.
Brown & Brown has delivered positive earnings surprises in
three of its last four reported quarters with an average beat of
Some of the better-ranked stocks in the insurance space that are
worth considering include
CNO Financial Group, Inc.
FBL Financial Group Inc.
). All these stocks carry a Zacks Rank #1 (Strong Buy).
BROWN & BROWN (BRO): Free Stock Analysis
CNO FINL GRP (CNO): Free Stock Analysis
FBL FINL GRP-A (FFG): Free Stock Analysis
KEMPER CORP (KMPR): Free Stock Analysis
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