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Analysis of Agencies with Revenues Between $5,000,000 and $10,000,000
95 of 113
VI.
Financial Stability (Agencies with Revenues Between $5,000,000 and $10,000,000)
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
1.35:1
2.09:1
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)
9.9%
29.4%
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
57.9%
23.2%
2. Aged Receivables
Over 60
11.4%
2.1%
Over 90
2.1%
0.9%
Average
Average
Top 25%
Average
Top 25%
Average
Top 25%
Top 25%
VII. Carrier Representation (Agencies with Revenues Between $5,000,000 and $10,000,000)
Average +25% Profit +25% Growth
Personal Lines
National
6.0
5.0
6.3
Regional
3.0
3.0
2.3
Commercial Lines
National
16.2
16.8
19.5
Regional
9.4
16.3
14.5
Total Carriers
34.7
41.2
42.7
% of Net Rev from Top Carrier
15.5%
25.6%
12.8%
% of Net Rev from Top 3 Carriers
32.3%
54.1%
25.2%