"The recent selloff in shares of Brink's looks like an opportunity for value-minded investors," according to Barron's.
The provider of secure logistics and security solutions services has "faced pressure since the recession, as its core banking customers have focused on consolidating and cutting costs. Yet Brink's retains substantial franchise value as a market leader in a fragmented industry, and its efforts to boost profit margins are likely to succeed, Barron's noted
- BCO's revenue growth has slightly outpaced the industry average of 3.8%. Since the same quarter one year prior, revenues slightly increased by 4.3%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- BRINKS CO has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. The company has reported a trend of declining earnings per share over the past two years. However, the consensus estimate suggests that this trend should reverse in the coming year. During the past fiscal year, BRINKS CO reported lower earnings of $1.49 versus $2.29 in the prior year. This year, the market expects an improvement in earnings ($1.72 versus $1.49).
- The gross profit margin for BRINKS CO is rather low; currently it is at 24.16%. Regardless of BCO's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, BCO's net profit margin of -5.89% significantly underperformed when compared to the industry average.
- The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Commercial Services & Supplies industry. The net income has significantly decreased by 252.4% when compared to the same quarter one year ago, falling from -$16.60 million to -$58.50 million.
- The share price of BRINKS CO has not done very well: it is down 7.65% and has underperformed the S&P 500, in part reflecting the company's sharply declining earnings per share when compared to the year-earlier quarter. Looking ahead, other than the push or pull of the broad market, we do not see anything in the company's numbers that may help reverse the decline experienced over the past 12 months. Despite the past decline, the stock is still selling for more than most others in its industry.
- You can view the full analysis from the report here: BCO Ratings Report