Broker Network operates in the Insurance sector, as a network organisation for independent community insurance brokers. Company have gone from strength to strength in last 2 years. Today they have just released excellent Interim figures which I will post below, even before these results forward EPS to 2007 was only 10.77 and 2008 = 9.72. Should be a new Broker Forecast out soon, but if you check the Interims you will notice how cheap these shares still are, even after recent increases. Fundamentals all look very stong, with very stong balance sheet and margins are very healthy and improving.

Because of new and tighter FSA rules Broker Network have and will continue to benefit because of the Thousands of small partner firms in this sector who struggle with the tighter regulation. They are coming under the Broker Network umbrella, who then take care of the FSA rules for them ( For a fee of course )

Another rise to 365p today, the reason is a positive trading update on 11th June, as follows.

Broker Network Holdings PLC said it expects results for the year to April 30 to exceed current market expectations as trading across the group has been strong, despite soft insurance market conditions.

The independent community insurance broker said a harder insurance market seems unlikely in the near future with interest rates rising, equity markets buoyant and benign weather conditions prevailing.

It added that its retail division is performing well driven by improved commission earnings negotiated by the network, helping to improve margins overall despite pressure on top line premiums.

The group said it continues to be confident in its acquisition proposition and the pipeline remains healthy.

BNH got a small positive writeup in this weeks Shares Mag.
Of course, just my luck that I sold last week at a profit, due to the drop in the sp, not expecting such a sharp rise!
Am also expecting a main market correction soon, so trying to lock in some profits at the moment.
Will try & get back in if there is a drop.

That sounds like my sort of luck. Interesting to hear your view of the market correction, which is the same as mine. I have been going to a more cash position, to take advantage of a correction which must come at some stage.

So I'm trying to hold off buying any more at the moment.

Big Broker Buy upgade on 13/06/2007 Wednesday from Teather & Greenwood.

2007 = Profit - 6.3m and EPS - 30.1P
2008 = Profit - 7.2m and EPS - 33.9p

Previous buy recommendation was in January as follows.

2007 = Profit - 5.2m and EPS - 24.6p
2008 = Profit - 6.0m and EPS - 28.1p

Thats one hell of an upgrade in anyones book.

After latest broker estimate Cenkos Security have a price target of 5.23

Price is now 3.83 so plenty of space for the sp to carry on upwards.

Results due 13/9/07 should be good.

Yes agreed, sp seems to be recovering nicely anticipating the results.

The insurance sector is taking a bit of a hit at the moment.
Why do you assume the results are good? Or do you have info to support?

See RNS trading update 11/6/07 which among other things states results expected to exceed market expectatios and trading continues to be strong.

Fair enough, but that's 3 months ago & a great deal has changed since then.
I wouldn't be surprised for them to say that trading has met expectations, rather than exceeded them. Hope you are right though.

BNH's year end is 30/4/07 I think a trading statement issued on 11/6/07 ought to reflect the actual performance of the company already achieved, dont you.

I accept that the insurance market has been weaker recently, but BNH operate in a niche area. They did say in the last trading update that acquisitions like Towry Law are harder to find now, but I would still expect them to achieve expected earnings.

The rate off growth has been exceptional in past two years, which has been reflected in the sp, that sort of growth rate will slow down. If EPS is 30.1P for pe of 11.6 then hopefully the market will over-react and we can all take some profit on the way up.

I am in for the long term . Do you remember the spectacular growth of Minet? BNH's business model is proven if anything more people will need insurance brokers as the recent flood disasters have highlighted the stupidity of not being adequately covered.

Just as I post that BNH would find suitable acquisitions harder to find, guess what they find one see below. And sp increases 9.5 to 366.5.

Broker Network Holdings PLC said it has completed the acquisition of commercial insurance brokers Sullivan Garrett Ltd for an undisclosed sum.

Sullivan Garrett will join Broker Network Insurance Brokers, the company's UK-wide retail operation, while retaining its brand identity.

The purchase is in line with Broker's acquisition strategy allowing it to increase earnings via economies of scale and by retaining a higher percentage of premium turnover, the independent community insurance broker said.

Finals posted today, see below some of the highlights.

Operational Highlights

Network Membership increased by over 10% and average size of new Member
64% higher
Members performing well, with a number growing through acquisition
Successfully completed integration of TL Risk Solutions into the Group
Customer retention across retail division is consistently high
Group wide re-brand successfully launched for each operating division
Reputation as experienced acquirer consolidated
Continued pursuit of expansion and acquisition opportunities building a
strong pipeline

Financial Highlights

Turnover increased by 86% to 23.26 million (2006: 12.54 million)
Operating profit up 147% at 5.15 million (2006: 2.09 million)
Profit before tax and goodwill amortisation up 100% at 6.53 million
(2006: 3.26 million)
Group operating margin before amortisation 29.5% (2006: 23.5%)
Fully diluted earnings per share up 98% at 20.33p (2006: 10.27p)
Dividend payment of 1.20p per share (2006: 1.00p)

Outlook for 2007-08

I am delighted to have maintained our market leading position and intend to
build on it.

There are still abundant opportunities for expansion within this fast moving
industry and we are working hard to remain at the forefront in our areas of
expertise. For example we are currently evaluating the opportunity that exists
to expand our Healthcare business following the successful acquisition and
integration of TLRS, which has a sizeable Healthcare division within it. We
remain realistic and prudent in our acquisition programme and we continue to
evaluate critically our offering to network Members and Partner Insurers to
ensure we retain our market-leading position as the UK's number one network for
independent insurance brokers.

We strongly believe that the Broker Network business model remains relevant and
robust. Whilst challenging trading conditions lay ahead we are looking forward
with confidence to another year of good performance and enhanced shareholder
value.

Adjusted Basic eps before amortisation = 31.92p

This would make more sense re Broker forecast which was 30.1p.

Excellent results onwards to 5ps. What is the PER now spitfire?

Using 3.80 sp and 31.92 EPS the PE = 11.9, and for 2008 using the last Broker forecast the PER would be 11.2.

I would think their would be another forecast arriving soon. It's good to have these solid results which should cement the recent gains.

spitfire I agree CEO's ambitious acquisition forecast out to 2015 would result in BNH managing/owning 10% of insurance brokers in UK. 2008 premiums set to rise significantly will generate greater revenue.
I hope some consideration is given to making this share more liquid as with only 15million shares issued it needs to attract more institutional investors.

1 million bought @400p?