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 $10.5 million.
  • BRC has traded 5.7760999999999995679900166578590869903564453125 options contracts today.
  • BRC is making at least a new 3-day high.
  • BRC has a PE ratio of 95.
  • BRC is mentioned 0.97 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 2.6%. BRC has a PE ratio of 95. 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 226,600 shares per day over the past 30 days. Brady has a market cap of $1.5 billion and is part of the technology sector and computer software & services industry. The stock has a beta of 1.11 and a short float of 4.1% with 5.50 days to cover. Shares are up 35.2% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Brady as a buy. The company's strengths can be seen in multiple areas, such as its impressive record of earnings per share growth, largely solid financial position with reasonable debt levels by most measures, good cash flow from operations, expanding profit margins and solid stock price performance. Although no company is perfect, currently we do not see any significant weaknesses which are likely to detract from the generally positive outlook.

Highlights from the ratings report include:
  • BRADY CORP has improved earnings per share by 27.3% 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. 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 ($1.45 versus $0.09).
  • The current debt-to-equity ratio, 0.41, is low and is below the industry average, implying that there has been successful management of debt levels. To add to this, BRC has a quick ratio of 1.80, which demonstrates the ability of the company to cover short-term liquidity needs.
  • Net operating cash flow has increased to $40.30 million or 39.86% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of 19.88%.
  • The gross profit margin for BRADY CORP is rather high; currently it is at 53.29%. 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 7.31% trails the industry average.
  • Looking at where the stock is today compared to one year ago, we find that it is not only higher, but it has also clearly outperformed the rise in the S&P 500 over the same period. Although other factors naturally played a role, the company's strong earnings growth was key. The stock's price rise over the last year has driven it to a level which is somewhat expensive compared to the rest of its industry. We feel, however, that other strengths this company displays justify these higher price levels.

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