Financial Services

Insurance Brokerage & Title Insurance

Our insurance brokerage coverage focuses on property and casualty brokers primarily focusing on middle-market accounts and above. While the number of public brokers has fallen dramatically due to M&A, we expect many of these brokers to resurface once the pricing environment improves. We think insurance brokerage is an outstanding industry given its 90% customer retention, high margins, high returns on capital, attractive cash flows and given the fragmented nature of the business, and the ability to grow through M&A.

We find the title insurance marketplace especially attractive given every real estate transaction dictates buying a title policy, the infrastructure costs are highly leveragable and barriers to entry are significant. Simply put, title insurers either have great times (heavy refinance activity and Americans buy/sell homes) or bad times (lenders won’t lend and/or Americans don't change out homes).  Given the limited revenue visibility, the best operators are those that manage costs the quickest/best and deploy free cash flow from the good times in ways that best shareholders for when the bad times come.

Analysts:
Brett Huff: Bio
 Associates:
John Campbell: Bio

Companies

Brown & Brown, Inc.Fidelity National FinancialFirst American Corp.
Insurance Brokerage & Title Insurance – Comparative Valuation (02/06/2012)
Insurance Brokerage & Title Insurance – Comparative Valuation (01/30/2012)
Insurance Brokerage & Title Insurance – Comparative Valuation (01/23/2012)
Conference Call With HUB International Management (01/17/2012)
Insurance Brokerage & Title Insurance – Comparative Valuation (01/17/2012)
Mortgage Technology & Title Insurance Field Trip (01/12/2012)
Insurance Brokerage & Title Insurance – Comparative Valuation (01/09/2012)
Mortgage Technology & Title Insurance Field Trip (01/05/2012)
Insurance Brokerage & Title Insurance – Comparative Valuation (01/03/2012)
Insurance Brokerage & Title Insurance – Comparative Valuation (12/27/2011)
Insurance Brokerage & Title Insurance – Comparative Valuation (12/19/2011)
Insurance Brokerage & Title Insurance – Comparative Valuation (12/12/2011)
Insurance Brokerage & Title Insurance – Comparative Valuation (12/05/2011)
Insurance Brokerage & Title Insurance – Comparative Valuation (11/28/2011)
Insurance Brokerage & Title Insurance – Comparative Valuation (11/21/2011)
Insurance Brokerage & Title Insurance – Comparative Valuation (11/14/2011)
Insurance Brokerage & Title Insurance – Comparative Valuation (11/07/2011)
Insurance Brokerage & Title Insurance – Comparative Valuation (10/31/2011)
Insurance Brokerage & Title Insurance – Comparative Valuation (10/24/2011)
Insurance Brokerage & Title Insurance – Comparative Valuation (10/17/2011)
Insurance Brokerage & Title Insurance – Comparative Valuation (10/03/2011)
Insurance Brokerage & Title Insurance – Comparative Valuation (09/26/2011)
Insurance Brokerage & Title Insurance – Comparative Valuation (09/19/2011)
Insurance Brokerage & Title Insurance – Comparative Valuation (09/12/2011)
Insurance Brokerage & Title Insurance – Comparative Valuation (09/06/2011)
Insurance Brokerage & Title Insurance – Comparative Valuation (08/29/2011)
Insurance Brokerage & Title Insurance – Comparative Valuation (08/22/2011)
Insurance Brokerage & Title Insurance – Comparative Valuation (08/15/2011)
Insurance Brokerage & Title Insurance – Comparative Valuation (08/08/2011)
Insurance Brokerage & Title Insurance – Comparative Valuation (08/01/2011)
Insurance Brokerage & Title Insurance – Comparative Valuation (07/25/2011)
Insurance Brokerage & Title Insurance – Comparative Valuation (07/18/2011)
Comparative Valuation (07/11/2011)
Insurance Brokerage & Title Insurance – Comparative Valuation (07/05/2011)
Insurance Brokerage & Title Insurance – Comparative Valuation (06/27/2011)
Insurance Brokerage & Title Insurance – Comparative Valuation (06/20/2011)
Insurance Brokerage & Title Insurance – Comparative Valuation (06/14/2011)
Insurance Brokerage & Title Insurance – Comparative Valuation (06/06/2011)
Insurance Brokerage & Title Insurance - Comparative Valuation (06/01/2011)
Long-Term Positives for Title Stocks, but Few Near-Term Catalysts...Yet (03/07/2011)
Mortgage Technology & Title Insurance Field Trip (01/20/2011)
3Q Preview - Expect Strong Showing by FNF; Low Liability From Foreclosure Issue (10/15/2010)
Comparative Valuation (08/23/2010)
2Q10 Title Earnings Preview - Low Rates Spur Refis, but Not Much Excitement (07/19/2010)
Comparative Valuation (05/03/2010)
Comparative Valuation (03/02/2010)
Comparative Valuation (01/12/2010)