UPDATE: Compass Point Downgrades Brown & Brown to Neutral, Lowers PT on Persistent Margin Pressure

In a report published Wednesday, Compass Point analyst Ken Billingsley downgraded the rating on

from Buy to Neutral, and lowered the price target from $36.00 to $33.00. In the report, Compass Point noted, “We downgrade BRO to Neutral and lower our price target to $33 from $36. The integration of larger account business from Beecher Carlson coupled with the soon to be completed Wright Insurance Group Acquisition in 2Q14 will continue to add margin pressure in the near term. While the acquisitions will continue to evolve the company's operation platform, BRO will not continue to enjoy pricing multiples in excess of its peer group in the near term. The acquisition of larger businesses, coupled with weakening margins (though still above the peer group), and the increased use of debt to fund transactions will generate more conservative valuations for BRO in the near term.” Brown & Brown closed on Tuesday at $30.10.