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Brown & Brown's (BRO) Unit Acquires Poole Professional

Zacks Equity Research

Brown & Brown’s BRO unit Brown & Brown of Massachusetts, LLC recently acquired Poole Professional Companies. The acquired entity will operate as a new standalone office within Brown & Brown’s Retail segment.

Poole Professional Companies, founded in 1994, offers risk management products and services. The company serves architects and engineers across New England, New York, Pennsylvania, and New Jersey. It also offers professional liability insurance products and services to lawyers, accountants and other specialty customers.

The addition of Poole Professional will strengthen the acquirer’s products and services portfolio and enhance growth opportunities by catering to risk management issues faced by design professionals.

As far as Poole Professional is concerned, the combination will help its clients leverage Brown & Brown’s compelling insurance and risk management solutions.

This recent transaction marks the first buyout for this Zacks Rank #2 (Buy) insurance broker in the ongoing quarter. Consistent investments along with solid earnings help the company in its inorganic efforts and buyouts. These strategic buyouts help Brown & Brown to increase commissions and fees, which, in turn, drive revenues.

Brown & Brown boasts an impressive growth backed by organic and inorganic growth. Strategic mergers and acquisitions have enabled it to expand its operations.  The company closed 12 transactions with annualized revenues of $50 million in the first half of 2019.  The company has acquired 500 insurance intermediary operations in more than two decades. It remains focused on making investments to drive organic growth and margin expansion.

Recently, there have been a number of acquisitions in the insurance industry, given the significant capital available. Arthur J. Gallagher & Co. AJG acquired The Doyle Group, Inc. and its affiliates, collectively doing business as Direct To PolicyHolder.

Shares of Brown & Brown have gained 30.8% year to date, outperforming the industry’s increase of 25.5%. The company’s efforts to ramp up growth and its solid capital position should continue to drive shares higher.



Other Stocks to Consider

Some other top-ranked stocks in the same space include eHealth EHTH and Willis Towers Watson Public Limited Company WLTW. While eHealth sports a Zacks Rank #1 (Strong Buy), Willis Towers Watson Public Limited Company carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

eHealth operates through two segments, and provides services like private health insurance exchange in the United States and China to families, individuals and small businesses. The company came up with average four-quarter positive surprise of 167.16%.

Willis Towers Watson Public Limited Company operates as an advisory, broking, and solutions company worldwide. It offers actuarial support, plan design, and administrative services for traditional pension and retirement savings plans. The company came up with average four-quarter positive surprise of 4.56%.

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