BROADRIDGE FINANCIAL SOLUTIO (BR) Stock Fundamental Analysis
NYSE:BR - New York Stock Exchange, Inc. - US11133T1034 - Common Stock - Currency: USD
Overall BR gets a fundamental rating of 5 out of 10. We evaluated BR against 82 industry peers in the IT Services industry. BR scores excellent on profitability, but there are some minor concerns on its financial health. BR is valied quite expensively at the moment, while it does show a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year BR was profitable.
BR had a positive operating cash flow in the past year.
BR had positive earnings in each of the past 5 years.
BR had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
BR's Return On Assets of 9.22% is fine compared to the rest of the industry. BR outperforms 79.49% of its industry peers.
BR has a Return On Equity of 34.07%. This is amongst the best in the industry. BR outperforms 94.87% of its industry peers.
Looking at the Return On Invested Capital, with a value of 12.16%, BR is in the better half of the industry, outperforming 79.49% of the companies in the same industry.
BR had an Average Return On Invested Capital over the past 3 years of 11.13%. This is in line with the industry average of 10.34%.
The last Return On Invested Capital (12.16%) for BR is above the 3 year average (11.13%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 9.22% | ||
| ROE | 34.07% | ||
| ROIC | 12.16% |
ROA(3y)7.58%
ROA(5y)7.79%
ROE(3y)29.48%
ROE(5y)30.61%
ROIC(3y)11.13%
ROIC(5y)11.06%
1.3 Margins
Looking at the Profit Margin, with a value of 11.36%, BR belongs to the top of the industry, outperforming 83.33% of the companies in the same industry.
In the last couple of years the Profit Margin of BR has remained more or less at the same level.
BR's Operating Margin of 16.30% is amongst the best of the industry. BR outperforms 88.46% of its industry peers.
BR's Operating Margin has been stable in the last couple of years.
BR has a worse Gross Margin (30.25%) than 60.26% of its industry peers.
In the last couple of years the Gross Margin of BR has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 16.3% | ||
| PM (TTM) | 11.36% | ||
| GM | 30.25% |
OM growth 3Y4.77%
OM growth 5Y0.88%
PM growth 3Y-0.72%
PM growth 5Y-0.59%
GM growth 3Y1.42%
GM growth 5Y1.05%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so BR is still creating some value.
BR has less shares outstanding than it did 1 year ago.
The number of shares outstanding for BR has been increased compared to 5 years ago.
The debt/assets ratio for BR has been reduced compared to a year ago.
2.2 Solvency
BR has an Altman-Z score of 4.65. This indicates that BR is financially healthy and has little risk of bankruptcy at the moment.
With a decent Altman-Z score value of 4.65, BR is doing good in the industry, outperforming 73.08% of the companies in the same industry.
The Debt to FCF ratio of BR is 4.03, which is a neutral value as it means it would take BR, 4.03 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 4.03, BR is in line with its industry, outperforming 56.41% of the companies in the same industry.
BR has a Debt/Equity ratio of 1.64. This is a high value indicating a heavy dependency on external financing.
The Debt to Equity ratio of BR (1.64) is worse than 73.08% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.64 | ||
| Debt/FCF | 4.03 | ||
| Altman-Z | 4.65 |
ROIC/WACC1.12
WACC10.88%
2.3 Liquidity
BR has a Current Ratio of 1.35. This is a normal value and indicates that BR is financially healthy and should not expect problems in meeting its short term obligations.
BR's Current ratio of 1.35 is on the low side compared to the rest of the industry. BR is outperformed by 61.54% of its industry peers.
BR has a Quick Ratio of 1.35. This is a normal value and indicates that BR is financially healthy and should not expect problems in meeting its short term obligations.
The Quick ratio of BR (1.35) is worse than 60.26% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.35 | ||
| Quick Ratio | 1.35 |
3. Growth
3.1 Past
BR shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 14.03%, which is quite good.
BR shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 10.68% yearly.
The Revenue has been growing slightly by 5.73% in the past year.
Measured over the past years, BR shows a quite strong growth in Revenue. The Revenue has been growing by 8.33% on average per year.
EPS 1Y (TTM)14.03%
EPS 3Y11%
EPS 5Y10.68%
EPS Q2Q%69.57%
Revenue 1Y (TTM)5.73%
Revenue growth 3Y9.22%
Revenue growth 5Y8.33%
Sales Q2Q%13.11%
3.2 Future
BR is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 9.68% yearly.
The Revenue is expected to grow by 5.09% on average over the next years.
EPS Next Y13.93%
EPS Next 2Y11.37%
EPS Next 3Y10.92%
EPS Next 5Y9.68%
Revenue Next Year6.52%
Revenue Next 2Y5.82%
Revenue Next 3Y5.68%
Revenue Next 5Y5.09%
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.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
BR is valuated quite expensively with a Price/Earnings ratio of 28.39.
BR's Price/Earnings ratio is in line with the industry average.
BR is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 29.62, which is the current average of the S&P500 Index.
BR is valuated rather expensively with a Price/Forward Earnings ratio of 24.51.
Based on the Price/Forward Earnings ratio, BR is valued a bit cheaper than the industry average as 61.54% of the companies are valued more expensively.
The average S&P500 Price/Forward Earnings ratio is at 22.70. BR is around the same levels.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 28.39 | ||
| Fwd PE | 24.51 |
4.2 Price Multiples
BR's Enterprise Value to EBITDA ratio is in line with the industry average.
The rest of the industry has a similar Price/Free Cash Flow ratio as BR.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 30.32 | ||
| EV/EBITDA | 21.88 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates BR does not grow enough to justify the current Price/Earnings ratio.
BR has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)2.04
PEG (5Y)2.66
EPS Next 2Y11.37%
EPS Next 3Y10.92%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.49%, BR has a reasonable but not impressive dividend return.
BR's Dividend Yield is rather good when compared to the industry average which is at 2.94. BR pays more dividend than 84.62% of the companies in the same industry.
Compared to the average S&P500 Dividend Yield of 2.27, BR is paying slightly less dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.49% |
5.2 History
On average, the dividend of BR grows each year by 11.36%, which is quite nice.
BR has paid a dividend for at least 10 years, which is a reliable track record.
BR has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)11.36%
Div Incr Years17
Div Non Decr Years17
5.3 Sustainability
BR pays out 50.68% of its income as dividend. This is a bit on the high side, but may be sustainable.
The dividend of BR is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP50.68%
EPS Next 2Y11.37%
EPS Next 3Y10.92%
235.33
-0.97 (-0.41%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustryIT Services
Earnings (Last)
Earnings (Next)
Inst Owners92.15%
Inst Owner Change-81.24%
Ins Owners0.5%
Ins Owner Change-1.74%
Market Cap27.54B
Analysts75.29
Price Target245.03 (4.12%)
Short Float %0.87%
Short Ratio2.25
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.49% |
Yearly Dividend3.14
Dividend Growth(5Y)11.36%
DP50.68%
Div Incr Years17
Div Non Decr Years17
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)1.46%
Min EPS beat(2)0.09%
Max EPS beat(2)2.83%
EPS beat(4)2
Avg EPS beat(4)-0.71%
Min EPS beat(4)-3.16%
Max EPS beat(4)2.83%
EPS beat(8)5
Avg EPS beat(8)0.68%
EPS beat(12)6
Avg EPS beat(12)-0.03%
EPS beat(16)8
Avg EPS beat(16)0.03%
Revenue beat(2)0
Avg Revenue beat(2)-3.87%
Min Revenue beat(2)-6.88%
Max Revenue beat(2)-0.86%
Revenue beat(4)0
Avg Revenue beat(4)-4.16%
Min Revenue beat(4)-6.88%
Max Revenue beat(4)-0.86%
Revenue beat(8)1
Avg Revenue beat(8)-3.4%
Revenue beat(12)2
Avg Revenue beat(12)-3.12%
Revenue beat(16)6
Avg Revenue beat(16)-1.77%
PT rev (1m)5.62%
PT rev (3m)10.31%
EPS NQ rev (1m)-2.75%
EPS NQ rev (3m)-1.38%
EPS NY rev (1m)0.36%
EPS NY rev (3m)0.56%
Revenue NQ rev (1m)0.47%
Revenue NQ rev (3m)2.46%
Revenue NY rev (1m)0.59%
Revenue NY rev (3m)0.69%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 28.39 | ||
| Fwd PE | 24.51 | ||
| P/S | 4.12 | ||
| P/FCF | 30.32 | ||
| P/OCF | 26.49 | ||
| P/B | 12.36 | ||
| P/tB | N/A | ||
| EV/EBITDA | 21.88 |
EPS(TTM)8.29
EY3.52%
EPS(NY)9.6
Fwd EY4.08%
FCF(TTM)7.76
FCFY3.3%
OCF(TTM)8.88
OCFY3.78%
SpS57.11
BVpS19.04
TBVpS-22.33
PEG (NY)2.04
PEG (5Y)2.66
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 9.22% | ||
| ROE | 34.07% | ||
| ROCE | 15.31% | ||
| ROIC | 12.16% | ||
| ROICexc | 12.68% | ||
| ROICexgc | 43.59% | ||
| OM | 16.3% | ||
| PM (TTM) | 11.36% | ||
| GM | 30.25% | ||
| FCFM | 13.59% |
ROA(3y)7.58%
ROA(5y)7.79%
ROE(3y)29.48%
ROE(5y)30.61%
ROIC(3y)11.13%
ROIC(5y)11.06%
ROICexc(3y)11.61%
ROICexc(5y)11.84%
ROICexgc(3y)63.11%
ROICexgc(5y)57.7%
ROCE(3y)14.01%
ROCE(5y)13.92%
ROICexcg growth 3Y6.75%
ROICexcg growth 5Y-7.68%
ROICexc growth 3Y14.68%
ROICexc growth 5Y-7.68%
OM growth 3Y4.77%
OM growth 5Y0.88%
PM growth 3Y-0.72%
PM growth 5Y-0.59%
GM growth 3Y1.42%
GM growth 5Y1.05%
F-Score8
Asset Turnover0.81
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.64 | ||
| Debt/FCF | 4.03 | ||
| Debt/EBITDA | 2.59 | ||
| Cap/Depr | 40.7% | ||
| Cap/Sales | 1.97% | ||
| Interest Coverage | 7.57 | ||
| Cash Conversion | 73.61% | ||
| Profit Quality | 119.64% | ||
| Current Ratio | 1.35 | ||
| Quick Ratio | 1.35 | ||
| Altman-Z | 4.65 |
F-Score8
WACC10.88%
ROIC/WACC1.12
Cap/Depr(3y)27.48%
Cap/Depr(5y)35.63%
Cap/Sales(3y)1.42%
Cap/Sales(5y)1.69%
Profit Quality(3y)107.48%
Profit Quality(5y)105.79%
High Growth Momentum
Growth
EPS 1Y (TTM)14.03%
EPS 3Y11%
EPS 5Y10.68%
EPS Q2Q%69.57%
EPS Next Y13.93%
EPS Next 2Y11.37%
EPS Next 3Y10.92%
EPS Next 5Y9.68%
Revenue 1Y (TTM)5.73%
Revenue growth 3Y9.22%
Revenue growth 5Y8.33%
Sales Q2Q%13.11%
Revenue Next Year6.52%
Revenue Next 2Y5.82%
Revenue Next 3Y5.68%
Revenue Next 5Y5.09%
EBIT growth 1Y7.46%
EBIT growth 3Y14.44%
EBIT growth 5Y9.28%
EBIT Next Year29.2%
EBIT Next 3Y13.84%
EBIT Next 5Y9.91%
FCF growth 1Y139.25%
FCF growth 3Y20.48%
FCF growth 5Y11.62%
OCF growth 1Y127.71%
OCF growth 3Y18.17%
OCF growth 5Y11.35%