Brown & Brown (NYSE:BRO) recently reported better-than-expected fourth-quarter 2022 results. The quarterly performance benefitted from higher commissions and fees (up 21.3% year-over-year), with support from solid new business and strong retention rates.
Brown & Brown is an insurance brokerage firm that offers risk management solutions to individuals and businesses.
The company’s Q4 revenues grew 22.1% year-over-year to $901.4 million, exceeding analysts’ expectations of $898 million. Meanwhile, adjusted earnings per share (EPS) increased by approximately 28.2% to $0.50, exceeding the Street’s expectations of $0.46.
For the full year 2022, Brown & Brown reported revenue of $3.57 billion, up 17.1% year-over-year. Also, adjusted earnings increased by 6.5% to $2.28 per share.
Is BRO a Buy?
Following the results, Wells Fargo analyst Elyse Greenspan reiterated a Hold rating on BRO stock with a price target of $60. The analyst expects the company’s stock to fall due to slowing retail growth and a significant contribution of flood-related revenue (within National Programs) in the quarter.
Overall, the Street is cautiously optimistic about the stock. This is based on three Buy and five Hold recommendations. The average price target of $64.75 implies 4.5% upside potential from the current level. Shares of the company have already gained 9.4% in 2023.