Head to Head Analysis: Goosehead Insurance (GSHD) & Brown & Brown (BRO)

Goosehead Insurance (NASDAQ:GSHD) and Brown & Brown (NYSE:BRO) are both finance companies, but which is the superior investment? We will contrast the two companies based on the strength of their risk, valuation, profitability, analyst recommendations, dividends, earnings and institutional ownership.

Dividends

Brown & Brown pays an annual dividend of $0.30 per share and has a dividend yield of 1.0%. Goosehead Insurance does not pay a dividend. Brown & Brown pays out 31.3% of its earnings in the form of a dividend. Brown & Brown has raised its dividend for 17 consecutive years.

Profitability

This table compares Goosehead Insurance and Brown & Brown’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Goosehead Insurance N/A N/A N/A
Brown & Brown 22.25% 11.75% 5.12%

Earnings & Valuation

This table compares Goosehead Insurance and Brown & Brown’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Goosehead Insurance N/A N/A N/A N/A N/A
Brown & Brown $1.88 billion 4.28 $399.63 million $0.96 30.05

Brown & Brown has higher revenue and earnings than Goosehead Insurance.

Analyst Recommendations

This is a summary of current ratings and price targets for Goosehead Insurance and Brown & Brown, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Goosehead Insurance 0 1 3 0 2.75
Brown & Brown 3 5 3 0 2.00

Goosehead Insurance presently has a consensus price target of $22.33, indicating a potential downside of 22.02%. Brown & Brown has a consensus price target of $28.50, indicating a potential downside of 1.21%. Given Brown & Brown’s higher probable upside, analysts clearly believe Brown & Brown is more favorable than Goosehead Insurance.

Institutional & Insider Ownership

75.6% of Goosehead Insurance shares are owned by institutional investors. Comparatively, 71.6% of Brown & Brown shares are owned by institutional investors. 17.1% of Brown & Brown shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Summary

Brown & Brown beats Goosehead Insurance on 8 of the 11 factors compared between the two stocks.

About Goosehead Insurance

Goosehead Insurance, Inc. focuses on operating as a holding company for Goosehead Financial, LLC that provides personal lines insurance agency services in the United States. The company operates through two segments, Corporate Channel and Franchise Channel. It offers various insurance products, including homeowner's insurance; auto insurance; other personal lines products, such as flood, wind, and earthquake insurance; excess liability or umbrella insurance; specialty lines insurance comprising motorcycle, recreational vehicle, and other insurance; commercial lines insurance consisting of general liability, property, and auto insurance for small businesses; and life insurance. The company was founded in 2003 and is headquartered in Westlake, Texas.

About Brown & Brown

Brown & Brown, Inc. markets and sells insurance products in the United States, England, Canada, Bermuda, and the Cayman Islands. Its Retail segment offers property insurance relating to physical damage to property and resultant interruption of business, or extra expense caused by fire, windstorm, or other perils; casualty insurance relating to legal liabilities, professional liability, cyber-liability, workers' compensation, and commercial and private passenger automobile coverages; fidelity and surety bonds; and life, accident, disability, health, hospitalization, medical, dental, and other ancillary insurance products, as well as risk management, loss control surveys and analysis, consultation, and claims processing services. Its National Programs segment offers professional liability and related package insurance products for dentists, oral surgeons, hygienists, lawyers, certified public accountants, optometrists, opticians, ophthalmologists, insurance agents, financial advisors, registered representatives, securities broker-dealers, benefit administrators, real estate brokers and title agents, and escrow agents, as well as supplementary insurance products related to weddings, events, medical facilities, and cyber liabilities. This segment also offers outsourced product development, marketing, underwriting, actuarial, compliance, and claims and other administrative services to insurance carrier partners; and commercial and public entity-related programs, and flood insurance products. Its Wholesale Brokerage segment markets and sells excess and surplus commercial insurance products to retail insurance agencies. Its Services segment offers third-party claims administration and medical utilization management services in the workers' compensation and all-lines liability arenas, Medicare Set-aside, Social Security disability, Medicare benefits advocacy, and claims adjusting services. The company was founded in 1939 and is headquartered in Daytona Beach, Florida.

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