As the Q3 earnings season wraps, let’s dig into this quarter’s best and worst performers in the insurance brokers industry, including Ryan Specialty (NYSE: RYAN) and its peers.
The insurance brokerage industry, while influenced by insurance pricing cycles, benefits from durable secular tailwinds as rising risk complexity (climate, data privacy), regulatory scrutiny, and insurance pricing inflation. These increase demand for professional risk-management advice. Brokers operate models that rely on commissions and fees tied to premium volumes and growing contributions from recurring advisory, benefits, and compliance services. Scale is a key advantage, enabling better carrier access, stronger data and benchmarking, and efficient deployment of technology and compliance investments, which in turn supports ongoing industry consolidation. The headwinds are labor intensity and wage inflation for producers, regulatory complexity (this cuts both ways, as you can see), and execution risk when integrating new digital tools into legacy workflows.
The 5 insurance brokers stocks we track reported a mixed Q3. As a group, revenues beat analysts’ consensus estimates by 1.1%.
While some insurance brokers stocks have fared somewhat better than others, they have collectively declined. On average, share prices are down 1.2% since the latest earnings results.
Ryan Specialty (NYSE: RYAN)
Founded in 2010 by insurance industry veteran Patrick Ryan, Ryan Specialty (NYSE: RYAN) is a wholesale insurance broker and underwriting manager that helps retail brokers place complex or hard-to-place risks with insurance carriers.
Ryan Specialty reported revenues of $754.6 million, up 24.8% year on year. This print exceeded analysts’ expectations by 2.9%. Overall, it was a very strong quarter for the company with an impressive beat of analysts’ organic revenue estimates and a solid beat of analysts’ revenue estimates.
Interestingly, the stock is up 2% since reporting and currently trades at $51.72.
Best Q3: Brown & Brown (NYSE: BRO)
With roots dating back to 1939 and operations spanning 44 U.S. states and 14 countries, Brown & Brown (NYSE: BRO) is an insurance brokerage and risk management firm that markets and sells insurance products across property, casualty, and employee benefits sectors.
Brown & Brown reported revenues of $1.61 billion, up 35.4% year on year, outperforming analysts’ expectations by 3.9%. The business had a very strong quarter with a beat of analysts’ EPS and revenue estimates.
Brown & Brown delivered the biggest analyst estimates beat and fastest revenue growth among its peers. Although it had a fine quarter compared its peers, the market seems unhappy with the results as the stock is down 8.1% since reporting. It currently trades at $80.70.
Is now the time to buy Brown & Brown? Access our full analysis of the earnings results here, it’s free for active Edge members.
Weakest Q3: Arthur J. Gallagher (NYSE: AJG)
Founded in 1927 and operating in approximately 130 countries through direct operations and correspondent networks, Arthur J. Gallagher (NYSE: AJG) provides insurance brokerage, reinsurance, consulting, and third-party claims settlement services to businesses and individuals worldwide.
Arthur J. Gallagher reported revenues of $3.37 billion, up 21.2% year on year, falling short of analysts’ expectations by 2.6%. It was a disappointing quarter as it posted a significant miss of analysts’ revenue estimates and a significant miss of analysts’ EPS estimates.
Arthur J. Gallagher delivered the weakest performance against analyst estimates in the group. As expected, the stock is down 1.3% since the results and currently trades at $258.63.
Read our full analysis of Arthur J. Gallagher’s results here.
Baldwin Insurance Group (NASDAQ: BWIN)
Rebranded from BRP Group in May 2024, Baldwin Insurance Group (NASDAQ: BWIN) is an independent insurance distribution company that provides tailored insurance, risk management, and employee benefits solutions to businesses and individuals.
Baldwin Insurance Group reported revenues of $365.4 million, up 7.8% year on year. This number surpassed analysts’ expectations by 0.9%. Taking a step back, it was a mixed quarter as it also logged a narrow beat of analysts’ revenue estimates but a slight miss of analysts’ organic revenue estimates.
Baldwin Insurance Group had the slowest revenue growth among its peers. The stock is up 1.6% since reporting and currently trades at $24.07.
Read our full, actionable report on Baldwin Insurance Group here, it’s free for active Edge members.
Marsh & McLennan (NYSE: MMC)
With roots dating back to 1871 and a presence in over 130 countries, Marsh & McLennan (NYSE: MMC) is a global professional services firm that helps organizations manage risk, strategy, and workforce challenges through its four specialized businesses.
Marsh & McLennan reported revenues of $6.35 billion, up 11.5% year on year. This print met analysts’ expectations. It was a satisfactory quarter as it also produced a beat of analysts’ EPS estimates.
The stock is flat since reporting and currently trades at $185.72.
Read our full, actionable report on Marsh & McLennan here, it’s free for active Edge members.
Market Update
In response to the Fed’s rate hikes in 2022 and 2023, inflation has been gradually trending down from its post-pandemic peak, trending closer to the Fed’s 2% target. Despite higher borrowing costs, the economy has avoided flashing recessionary signals. This is the much-desired soft landing that many investors hoped for. The recent rate cuts (0.5% in September and 0.25% in November 2024) have bolstered the stock market, making 2024 a strong year for equities. Donald Trump’s presidential win in November sparked additional market gains, sending indices to record highs in the days following his victory. However, debates continue over possible tariffs and corporate tax adjustments, raising questions about economic stability in 2025.
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