Strong And Under The Radar: Brady (BRC)

Trade-Ideas LLC identified Brady ( BRC) as a strong and under the radar candidate. In addition to specific proprietary factors, Trade-Ideas identified Brady as such a stock due to the following factors:

  • BRC has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $4.7 million.
  • BRC has traded 5.55220000000000002415845301584340631961822509765625 options contracts today.
  • BRC is making at least a new 3-day high.
  • BRC has a PE ratio of 113.
  • BRC is mentioned 0.35 times per day on StockTwits.
  • BRC has not yet been mentioned on StockTwits today.
  • BRC is currently in the upper 20% of its 1-year range.
  • BRC is in the upper 35% of its 20-day range.
  • BRC is in the upper 45% of its 5-day range.
  • BRC is currently trading above yesterday's high.

'Strong and Under the Radar' stocks tend to be worthwhile stocks to watch for a variety of factors including historical back testing and price action. Market technicians refer to such stocks as being in an accumulation phase before a mark-up and peak. Traders and hedge funds have frequently found that these types of stocks continue to build a solid price base and then ultimately spike higher and peak when others 'discover' how good the stock is performing. By leveraging the social discovery aspect of StockTwits we are highlighting stocks that don't currently receive much attention from retail investors, but we suspect may soon garner more attention.

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More details on BRC:

Brady Corporation manufactures and supplies identification solutions, specialty materials, and workplace safety products that identify and protect premises, products, and people in the United States and internationally. The stock currently has a dividend yield of 3%. BRC has a PE ratio of 113. Currently there are no analysts that rate Brady a buy, 2 analysts rate it a sell, and 3 rate it a hold.

The average volume for Brady has been 270,600 shares per day over the past 30 days. Brady has a market cap of $1.4 billion and is part of the technology sector and computer software & services industry. The stock has a beta of 1.12 and a short float of 4.5% with 12.28 days to cover. Shares are up 18.5% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Brady as a hold. The company's strengths can be seen in multiple areas, such as its impressive record of earnings per share growth, compelling growth in net income and largely solid financial position with reasonable debt levels by most measures. However, as a counter to these strengths, we find that revenues have generally been declining.

Highlights from the ratings report include:
  • BRADY CORP has improved earnings per share by 30.4% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, BRADY CORP turned its bottom line around by earning $0.09 versus -$0.95 in the prior year. This year, the market expects an improvement in earnings ($1.33 versus $0.09).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Commercial Services & Supplies industry. The net income increased by 32.0% when compared to the same quarter one year prior, rising from $11.58 million to $15.29 million.
  • The gross profit margin for BRADY CORP is rather high; currently it is at 52.68%. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of 5.69% trails the industry average.
  • Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. In comparison to the other companies in the Commercial Services & Supplies industry and the overall market, BRADY CORP's return on equity is significantly below that of the industry average and is below that of the S&P 500.
  • After a year of stock price fluctuations, the net result is that BRC's price has not changed very much. Although its weak earnings growth may have played a role in this flat result, don't lose sight of the fact that the performance of the overall market, as measured by the S&P 500 Index, was essentially similar. We feel that the combination of its price rise over the last year and its current price-to-earnings ratio relative to its industry tend to reduce its upside potential.

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