Brown & Brown’s recent pullback has expanded the discount to its historical trading multiples, creating an attractive entry point for long-term investors. The company has delivered double-digit adjusted EPS growth in each of the past three years and has increased its dividend for 24 consecutive years. With a return on equity exceeding 20% over the last five years and minimal debt maturities until 2028, Brown & Brown combines defensive cash flows with disciplined capital allocation, positioning it as a high-quality compounder trading below its five-year average valuation.

In Q4 2025 Brown & Brown reported total revenues of $1.6 billion, up 35.7% year-over-year, driven by the Accession acquisition, while organic revenues dipped 2.8% due to non-recurring items and lower CAT rates. Adjusted EBITDAC grew 35.6% to $529 million, sustaining a 32.9% margin, and adjusted diluted EPS rose 8.1% to $0.93. For the full year, total revenues reached $5.9 billion, a 22.8% increase, with organic revenue up 2.8%. Adjusted diluted EPS of $4.26 marked a 10.9% gain, and adjusted EBITDAC margin expanded to 35.9%, reflecting strong operating leverage despite integration costs and amortization headwinds.

Management’s disciplined acquisition strategy remains on track, with a deep pipeline of target brokers that can be integrated with minimal overlap and attractive earn-out structures. Brown & Brown expects to generate free cash flow per share of approximately $2.08 in 2025, up 12% year-over-year, driven by scale benefits and high margin core commissions. The company’s conservative leverage ratio, combined with strong cash conversion and a track record of accretive deals, underpins its ability to fund bolt-on acquisitions and sustain dividend growth without compromising credit metrics.