BRADY CORPORATION - CL A (BRC) Stock Fundamental Analysis
NYSE:BRC - New York Stock Exchange, Inc. - US1046741062 - Common Stock - Currency: USD
We assign a fundamental rating of 6 out of 10 to BRC. BRC was compared to 83 industry peers in the Commercial Services & Supplies industry. Both the health and profitability get an excellent rating, making BRC a very profitable company, without any liquidiy or solvency issues. BRC has a correct valuation and a medium growth rate. With these ratings, BRC could be worth investigating further for quality investing!.
1. Profitability
1.1 Basic Checks
BRC had positive earnings in the past year.
BRC had a positive operating cash flow in the past year.
BRC had positive earnings in each of the past 5 years.
Each year in the past 5 years BRC had a positive operating cash flow.
1.2 Ratios
With an excellent Return On Assets value of 11.43%, BRC belongs to the best of the industry, outperforming 83.13% of the companies in the same industry.
Looking at the Return On Equity, with a value of 16.62%, BRC is in the better half of the industry, outperforming 77.11% of the companies in the same industry.
The Return On Invested Capital of BRC (14.15%) is better than 84.34% of its industry peers.
The Average Return On Invested Capital over the past 3 years for BRC is above the industry average of 11.67%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.43% | ||
| ROE | 16.62% | ||
| ROIC | 14.15% |
ROA(3y)12.14%
ROA(5y)11.1%
ROE(3y)17.45%
ROE(5y)15.73%
ROIC(3y)14.85%
ROIC(5y)13.79%
1.3 Margins
BRC has a better Profit Margin (13.30%) than 85.54% of its industry peers.
BRC's Profit Margin has improved in the last couple of years.
Looking at the Operating Margin, with a value of 17.11%, BRC belongs to the top of the industry, outperforming 84.34% of the companies in the same industry.
BRC's Operating Margin has improved in the last couple of years.
The Gross Margin of BRC (50.53%) is better than 87.95% of its industry peers.
In the last couple of years the Gross Margin of BRC has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 17.11% | ||
| PM (TTM) | 13.3% | ||
| GM | 50.53% |
OM growth 3Y6.85%
OM growth 5Y5.34%
PM growth 3Y9.19%
PM growth 5Y5.44%
GM growth 3Y1.5%
GM growth 5Y0.56%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), BRC is creating some value.
BRC has less shares outstanding than it did 1 year ago.
The number of shares outstanding for BRC has been reduced compared to 5 years ago.
BRC has a worse debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 6.19 indicates that BRC is not in any danger for bankruptcy at the moment.
BRC has a Altman-Z score of 6.19. This is amongst the best in the industry. BRC outperforms 87.95% of its industry peers.
The Debt to FCF ratio of BRC is 0.58, which is an excellent value as it means it would take BRC, only 0.58 years of fcf income to pay off all of its debts.
BRC's Debt to FCF ratio of 0.58 is amongst the best of the industry. BRC outperforms 87.95% of its industry peers.
A Debt/Equity ratio of 0.09 indicates that BRC is not too dependend on debt financing.
BRC's Debt to Equity ratio of 0.09 is fine compared to the rest of the industry. BRC outperforms 75.90% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.09 | ||
| Debt/FCF | 0.58 | ||
| Altman-Z | 6.19 |
ROIC/WACC1.41
WACC10.03%
2.3 Liquidity
A Current Ratio of 1.87 indicates that BRC should not have too much problems paying its short term obligations.
With a decent Current ratio value of 1.87, BRC is doing good in the industry, outperforming 65.06% of the companies in the same industry.
BRC has a Quick Ratio of 1.26. This is a normal value and indicates that BRC is financially healthy and should not expect problems in meeting its short term obligations.
BRC has a Quick ratio (1.26) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.87 | ||
| Quick Ratio | 1.26 |
3. Growth
3.1 Past
BRC shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 11.58%, which is quite good.
BRC shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 11.34% yearly.
The Revenue has grown by 8.62% in the past year. This is quite good.
BRC shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 2.94% yearly.
EPS 1Y (TTM)11.58%
EPS 3Y16.83%
EPS 5Y11.34%
EPS Q2Q%11.93%
Revenue 1Y (TTM)8.62%
Revenue growth 3Y5.43%
Revenue growth 5Y2.94%
Sales Q2Q%11.42%
3.2 Future
Based on estimates for the next years, BRC will show a quite strong growth in Earnings Per Share. The EPS will grow by 9.96% on average per year.
The Revenue is expected to grow by 6.27% on average over the next years.
EPS Next Y9.88%
EPS Next 2Y9.96%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue Next Year11.23%
Revenue Next 2Y7.43%
Revenue Next 3Y6.27%
Revenue Next 5YN/A
3.3 Evolution
The EPS growth rate is stable: in the next years the growth will be about the same than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 14.84, the valuation of BRC can be described as correct.
74.70% of the companies in the same industry are more expensive than BRC, based on the Price/Earnings ratio.
When comparing the Price/Earnings ratio of BRC to the average of the S&P500 Index (26.34), we can say BRC is valued slightly cheaper.
The Price/Forward Earnings ratio is 13.21, which indicates a correct valuation of BRC.
Based on the Price/Forward Earnings ratio, BRC is valued a bit cheaper than the industry average as 78.31% of the companies are valued more expensively.
The average S&P500 Price/Forward Earnings ratio is at 22.19. BRC is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.84 | ||
| Fwd PE | 13.21 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, BRC is valued a bit cheaper than 63.86% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, BRC is valued a bit cheaper than the industry average as 69.88% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 17.93 | ||
| EV/EBITDA | 10.89 |
4.3 Compensation for Growth
BRC's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The excellent profitability rating of BRC may justify a higher PE ratio.
PEG (NY)1.5
PEG (5Y)1.31
EPS Next 2Y9.96%
EPS Next 3YN/A
5. Dividend
5.1 Amount
BRC has a Yearly Dividend Yield of 1.38%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 2.56, BRC pays a bit more dividend than its industry peers.
Compared to an average S&P500 Dividend Yield of 2.40, BRC's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.38% |
5.2 History
The dividend of BRC has a limited annual growth rate of 1.94%.
BRC has paid a dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)1.94%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
23.39% of the earnings are spent on dividend by BRC. This is a low number and sustainable payout ratio.
BRC's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP23.39%
EPS Next 2Y9.96%
EPS Next 3YN/A
67.22
-1.18 (-1.73%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCommercial & Professional Services
GICS IndustryCommercial Services & Supplies
Earnings (Last)
Earnings (Next)
Inst Owners84.55%
Inst Owner Change2.88%
Ins Owners3.14%
Ins Owner Change-0.37%
Market Cap3.18B
Analysts86.67
Price Target88.74 (32.01%)
Short Float %0.98%
Short Ratio2.13
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.38% |
Yearly Dividend0.94
Dividend Growth(5Y)1.94%
DP23.39%
Div Incr Years0
Div Non Decr Years0
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-2.46%
Min EPS beat(2)-4.34%
Max EPS beat(2)-0.58%
EPS beat(4)2
Avg EPS beat(4)0.59%
Min EPS beat(4)-4.34%
Max EPS beat(4)6.47%
EPS beat(8)5
Avg EPS beat(8)2.75%
EPS beat(12)8
Avg EPS beat(12)2.17%
EPS beat(16)8
Avg EPS beat(16)1.05%
Revenue beat(2)0
Avg Revenue beat(2)-1.87%
Min Revenue beat(2)-2.07%
Max Revenue beat(2)-1.66%
Revenue beat(4)1
Avg Revenue beat(4)-1.25%
Min Revenue beat(4)-3.31%
Max Revenue beat(4)2.04%
Revenue beat(8)3
Avg Revenue beat(8)-1.44%
Revenue beat(12)4
Avg Revenue beat(12)-1.39%
Revenue beat(16)8
Avg Revenue beat(16)-0.69%
PT rev (1m)0%
PT rev (3m)0%
EPS NQ rev (1m)-1.2%
EPS NQ rev (3m)-1.2%
EPS NY rev (1m)0%
EPS NY rev (3m)-1.29%
Revenue NQ rev (1m)-0.52%
Revenue NQ rev (3m)-0.52%
Revenue NY rev (1m)-0.39%
Revenue NY rev (3m)-0.39%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.84 | ||
| Fwd PE | 13.21 | ||
| P/S | 2.18 | ||
| P/FCF | 17.93 | ||
| P/OCF | 15.38 | ||
| P/B | 2.72 | ||
| P/tB | 8.52 | ||
| EV/EBITDA | 10.89 |
EPS(TTM)4.53
EY6.74%
EPS(NY)5.09
Fwd EY7.57%
FCF(TTM)3.75
FCFY5.58%
OCF(TTM)4.37
OCFY6.5%
SpS30.85
BVpS24.67
TBVpS7.89
PEG (NY)1.5
PEG (5Y)1.31
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.43% | ||
| ROE | 16.62% | ||
| ROCE | 18.02% | ||
| ROIC | 14.15% | ||
| ROICexc | 15.89% | ||
| ROICexgc | 44.58% | ||
| OM | 17.11% | ||
| PM (TTM) | 13.3% | ||
| GM | 50.53% | ||
| FCFM | 12.16% |
ROA(3y)12.14%
ROA(5y)11.1%
ROE(3y)17.45%
ROE(5y)15.73%
ROIC(3y)14.85%
ROIC(5y)13.79%
ROICexc(3y)17.45%
ROICexc(5y)16.44%
ROICexgc(3y)50.85%
ROICexgc(5y)48.48%
ROCE(3y)18.91%
ROCE(5y)17.56%
ROICexcg growth 3Y1.96%
ROICexcg growth 5Y-4.62%
ROICexc growth 3Y11.59%
ROICexc growth 5Y-0.96%
OM growth 3Y6.85%
OM growth 5Y5.34%
PM growth 3Y9.19%
PM growth 5Y5.44%
GM growth 3Y1.5%
GM growth 5Y0.56%
F-Score4
Asset Turnover0.86
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.09 | ||
| Debt/FCF | 0.58 | ||
| Debt/EBITDA | 0.36 | ||
| Cap/Depr | 77.94% | ||
| Cap/Sales | 2.02% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 71.95% | ||
| Profit Quality | 91.42% | ||
| Current Ratio | 1.87 | ||
| Quick Ratio | 1.26 | ||
| Altman-Z | 6.19 |
F-Score4
WACC10.03%
ROIC/WACC1.41
Cap/Depr(3y)150.91%
Cap/Depr(5y)135.21%
Cap/Sales(3y)3.57%
Cap/Sales(5y)3.12%
Profit Quality(3y)82.9%
Profit Quality(5y)97.85%
High Growth Momentum
Growth
EPS 1Y (TTM)11.58%
EPS 3Y16.83%
EPS 5Y11.34%
EPS Q2Q%11.93%
EPS Next Y9.88%
EPS Next 2Y9.96%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue 1Y (TTM)8.62%
Revenue growth 3Y5.43%
Revenue growth 5Y2.94%
Sales Q2Q%11.42%
Revenue Next Year11.23%
Revenue Next 2Y7.43%
Revenue Next 3Y6.27%
Revenue Next 5YN/A
EBIT growth 1Y4.43%
EBIT growth 3Y12.64%
EBIT growth 5Y8.43%
EBIT Next Year20.36%
EBIT Next 3Y14.11%
EBIT Next 5YN/A
FCF growth 1Y18.92%
FCF growth 3Y-0.62%
FCF growth 5Y6.25%
OCF growth 1Y12.97%
OCF growth 3Y7.43%
OCF growth 5Y9.48%