Goldman Sachs has downgraded Brown & Brown from Buy to Neutral and revised its price target to $119. The move reflects a more tempered view on the company’s growth potential as its organic expansion begins to mirror broader industry trends. With the rapid post-pandemic gains now behind it, the firm no longer sees the same level of outperformance that once justified a Buy rating.
📌 While Brown & Brown continues to operate from a position of strength, the valuation premium it commanded is coming under scrutiny. The stock has traded at a high multiple relative to peers, and with growth moderating, that premium is harder to defend. The downgrade signals a recognition that much of the near-term upside may already be priced in.
📌 On the dividend front, Brown & Brown remains dependable. The current dividend yield sits at approximately 0.54%, backed by a conservative payout ratio near 15%. This suggests ample room for future increases and strong coverage from operating cash flow, aligning with the company’s disciplined financial strategy.
📌 While the long-term trajectory for Brown & Brown remains intact, the downgrade highlights a pause in momentum. Investors will be watching closely to see if management can reignite growth or if valuation compression will continue in the quarters ahead.