NYSE:BRC

Stock Analysis Report

Executive Summary

Brady Corporation manufactures and supplies identification solutions (IDS) and workplace safety (WPS) products to identify and protect premises, products, and people in the United States and internationally.

Rewards

Trading at 23.7% below its fair value

Earnings are forecast to grow 4.71% per year

Earnings grew by 44.5% over the past year

Pays a reliable dividend of 1.66%

Risk Analysis

No risks detected for BRC from our risk checks.


Snowflake Analysis

Flawless balance sheet with proven track record and pays a dividend.


Similar Companies

Share Price & News

How has Brady's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: BRC has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-3.9%

BRC

1.8%

US Commercial Services

0.9%

US Market


1 Year Return

11.9%

BRC

22.5%

US Commercial Services

20.0%

US Market

Return vs Industry: BRC underperformed the US Commercial Services industry which returned 22.4% over the past year.

Return vs Market: BRC underperformed the US Market which returned 20.1% over the past year.


Shareholder returns

BRCIndustryMarket
7 Day-3.9%1.8%0.9%
30 Day-9.0%3.8%1.4%
90 Day-4.6%8.9%8.8%
1 Year13.8%11.9%27.0%22.5%22.5%20.0%
3 Year40.7%32.6%67.0%55.9%49.9%40.3%
5 Year119.6%94.8%106.3%84.2%73.2%54.1%

Price Volatility Vs. Market

How volatile is Brady's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Brady undervalued compared to its fair value and its price relative to the market?

23.7%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: BRC ($52.36) is trading below our estimate of fair value ($68.59)

Significantly Below Fair Value: BRC is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: BRC is good value based on its PE Ratio (20.2x) compared to the Commercial Services industry average (26.4x).

PE vs Market: BRC is poor value based on its PE Ratio (20.2x) compared to the US market (18.4x).


Price to Earnings Growth Ratio

PEG Ratio: BRC is poor value based on its PEG Ratio (4.3x)


Price to Book Ratio

PB vs Industry: BRC is overvalued based on its PB Ratio (3.2x) compared to the US Commercial Services industry average (1.8x).


Next Steps

Future Growth

How is Brady forecast to perform in the next 1 to 3 years based on estimates from 4 analysts?

4.7%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: BRC's forecast earnings growth (4.7% per year) is above the savings rate (1.7%).

Earnings vs Market: BRC's earnings (4.7% per year) are forecast to grow slower than the US market (14.6% per year).

High Growth Earnings: BRC's earnings are forecast to grow, but not significantly.

Revenue vs Market: BRC's revenue (2.7% per year) is forecast to grow slower than the US market (7.6% per year).

High Growth Revenue: BRC's revenue (2.7% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: Insufficient data to determine if BRC's Return on Equity is forecast to be high in 3 years time


Next Steps

Past Performance

How has Brady performed over the past 5 years?

47.6%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: BRC has high quality earnings.

Growing Profit Margin: BRC's current net profit margins (11.9%) are higher than last year (8.1%).


Past Earnings Growth Analysis

Earnings Trend: BRC has become profitable over the past 5 years, growing earnings by 47.6% per year.

Accelerating Growth: BRC's earnings growth over the past year (44.5%) is below its 5-year average (47.6% per year).

Earnings vs Industry: BRC earnings growth over the past year (44.5%) exceeded the Commercial Services industry 0.2%.


Return on Equity

High ROE: BRC's Return on Equity (15.8%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Brady's financial position?


Financial Position Analysis

Short Term Liabilities: BRC's short term assets ($593.9M) exceed its short term liabilities ($255.9M).

Long Term Liabilities: BRC's short term assets ($593.9M) exceed its long term liabilities ($98.7M).


Debt to Equity History and Analysis

Debt Level: BRC's debt to equity ratio (5.7%) is considered satisfactory.

Reducing Debt: BRC's debt to equity ratio has reduced from 42.7% to 5.7% over the past 5 years.

Debt Coverage: BRC's debt is well covered by operating cash flow (363.4%).

Interest Coverage: BRC earns more interest than it pays, so coverage of interest payments is not a concern.


Balance Sheet

Inventory Level: BRC has a high level of physical assets or inventory.

Debt Coverage by Assets: BRC's debt is covered by short term assets (assets are 11.8x debt).


Next Steps

Dividend

What is Brady's current dividend yield, its reliability and sustainability?

1.66%

Current Dividend Yield


Dividend Yield vs Market

company1.7%marketbottom25%1.4%markettop25%3.7%industryaverage1.5%forecastin3Years1.7%

Current dividend yield vs market & industry

Notable Dividend: BRC's dividend (1.66%) is higher than the bottom 25% of dividend payers in the US market (1.44%).

High Dividend: BRC's dividend (1.66%) is low compared to the top 25% of dividend payers in the US market (3.69%).


Stability and Growth of Payments

Stable Dividend: BRC's dividends per share have been stable in the past 10 years.

Growing Dividend: BRC's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (33%), BRC's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: Insufficient data to determine if a dividend will be paid in 3 years and that it will be covered by earnings.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

5.5yrs

Average management tenure


CEO

J. Nauman (57yo)

5.5yrs

Tenure

US$5,240,929

Compensation

Mr. J. Michael Nauman has been the Chief Executive Officer and President of Brady Corp. since August 4, 2014. Mr. Nauman joined Brady after 20 years in a number of senior management positions at Lisle, Ill ...


CEO Compensation Analysis

Compensation vs Market: J.'s total compensation ($USD5.24M) is about average for companies of similar size in the US market ($USD4.89M).

Compensation vs Earnings: J.'s compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
J. Nauman
President5.5yrsUS$5.24m0.18% $5.0m
Aaron Pearce
CFO & Treasurer5.4yrsUS$1.79m0.096% $2.7m
Louis Bolognini
Senior VP7.1yrsUS$1.14m0.027% $759.7k
Helena Nelligan
Senior Vice President of Human Resources6.3yrsUS$1.32m0.021% $589.7k
Russell Shaller
Senior VP & President of Identification Solutions4.7yrsUS$1.55m0.052% $1.5m
Ann Thornton
Chief Accounting Officer & Corporate Controller3.3yrsno data0.026% $729.6k
Bentley Curran
VP of Digital Business & Chief Information Officer8yrsUS$802.29k0.030% $839.8k
Kathy Johnson
Vice President of Finance & Chief Accounting Officer0yrsno datano data
Kathleen Johnson
Vice President of Finance - Identification Solutions Business4.6yrsno datano data
Jeanne Coleman
Contact Center Director of Sales & Customer Service0yrsno datano data

5.5yrs

Average Tenure

56.5yo

Average Age

Experienced Management: BRC's management team is seasoned and experienced (5.5 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
J. Nauman
President5.5yrsUS$5.24m0.18% $5.0m
Patrick Allender
Independent Director12.4yrsUS$214.03k0.014% $386.8k
Conrad Goodkind
Chairman of the Board4.4yrsUS$271.53k0.12% $3.3m
Frank Harris
Independent Director28.3yrsUS$191.03k0.049% $1.4m
Bradley Richardson
Independent Director12.3yrsUS$221.03kno data
Elizabeth Bruno
Independent Director16.3yrsUS$189.03k8.88% $247.7m
Gary Balkema
Independent Director9.6yrsUS$208.03k0.0065% $180.6k
Nancy Gioia
Independent Director6.3yrsUS$201.03k0.020% $556.0k
David Bem
Independent Director1yrsUS$152.17k0.0082% $228.3k
Michelle Williams
Independent Director1yrsUS$152.17kno data

7.9yrs

Average Tenure

60yo

Average Age

Experienced Board: BRC's board of directors are considered experienced (7.9 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: BRC insiders have only sold shares in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Brady Corporation's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Brady Corporation
  • Ticker: BRC
  • Exchange: NYSE
  • Founded: 1914
  • Industry: Commercial Printing
  • Sector: Commercial Services
  • Market Cap: US$2.791b
  • Shares outstanding: 53.30m
  • Website: https://www.bradyid.com

Number of Employees


Location

  • Brady Corporation
  • 6555 West Good Hope Road
  • Milwaukee
  • Wisconsin
  • 53223
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
BRCNYSE (New York Stock Exchange)YesClass A Non-Voting Common StockUSUSDJun 1984
BRVDB (Deutsche Boerse AG)YesClass A Non-Voting Common StockDEEURJun 1984

Biography

Brady Corporation manufactures and supplies identification solutions (IDS) and workplace safety (WPS) products to identify and protect premises, products, and people in the United States and internationally. The IDS segment offers safety signs, floor-marking tapes, pipe markers, labeling systems, spill control products, and lockout/tagout devices for facility identification and protection; materials and printing systems for product identification, brand protection labeling, work in process labeling, and finished product identification; and hand-held printers, wire markers, sleeves, and tags for wire identification, as well as software and services for safety compliance auditing, procedure writing, and training. Its products also comprise name tags, badges, lanyards, and access control software for people identification; wristbands and labels for tracking and enhancing the safety of patients in hospitals; and custom wristbands for use in the leisure and entertainment industry, such as theme parks, concerts, and festivals. This segment serves customers in various industries, such as industrial and electronic manufacturing, healthcare, chemical, oil, gas, automotive, aerospace, governments, mass transit, electrical contractors, leisure and entertainment, telecommunications, and others through distributors, direct sales, catalog marketing, and digital channels. The WPS segment provides workplace safety and compliance products, such as safety and compliance signs, tags, labels, informational signage, asset tracking labels, first aid products, industrial warehouse and office equipment, and labor law compliance posters for various industries, including process, government, education, construction, and utilities, as well as manufacturers through catalog and digital channels. It also offers stock and custom identification products, as well as sells related resale products. Brady Corporation was founded in 1914 and is headquartered in Milwaukee, Wisconsin. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/17 23:34
End of Day Share Price2020/02/14 00:00
Earnings2019/10/31
Annual Earnings2019/07/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.