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Analysis of Agencies with Revenues Between $500,000 and $1,250,000
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VI.
Financial Stability (Agencies with Revenues Between $500,000 and $1,250,000)
A. Current Ratio
A current ratio greater than 1:1 indicates that cash and assets with short-term maturities are
sufficient to meet a firm's short-term obligations.
Liquidity/Current Ratio
1.50:1
2.05:1
B. Tangible Net Worth
The tangible net worth is an important measure as it represents the net value of the corporation
if it were liquidated. A low or negative tangible net worth impacts a firm's ability to invest
in new opportunities, develop new products, hire new employees, make other capital
expenditures and handle stockholder redemption obligations.
Tangible Net Worth (as a % of Net Rev)
5.5%
20.3%
C. Receivables
1. Receivables/Payable Ratio
This factor measures the collection practices of an agency, with a lower ratio representing
more timely collections. (Calculated by dividing total receivables by total payable at a given
point in time.)
Receivables/Payables Ratio
32.2%
-23.7%
2. Aged Receivables
Over 60
-2.8%
7.1%
Over 90
12.9%
6.2%
Top 25%
Top 25%
Average
Top 25%
Average
Top 25%
Average
Average
VII. Carrier Representation (Agencies with Revenues Between $500,000 and $1,250,000)
Average +25% Profit +25% Growth
Personal Lines
National
3.1
3.7
3.3
Regional
3.6
2.5
2.8
Commercial Lines
National
4.0
4.3
4.5
Regional
3.3
3.5
3.0
Total Carriers
13.9
14.0
13.7
% of Net Rev from Top Carrier
31.4%
29.4%
22.7%
% of Net Rev from Top 3 Carriers
47.9%
54.6%
41.9%