Brady Corporation BRC announced rewards for its shareholders in the form of a hike in the annual dividend rate. This hike is the company’s 34th consecutive yearly increase.
The news seems to be the prime reason behind roughly 3.4% gain in its share price at the end of the trading session yesterday.
We believe that such shareholder-friendly policies of the company reflect strong cash position and belief in profitability growth.
Inside the Headlines
The security services provider’s board of directors approved approximately a 2.4% or 2 cents per share hike in the annual dividend rate, which now stands at 87 cents per share. The previous quarterly dividend rate was 85 cents. On a quarterly basis, the dividend rate has been raised from 21.25 cents to 21.75 cents.
The company will pay the resultant quarterly dividend on Oct 31, 2019, to shareholders of record as of Oct 10.
Sound Capital-Allocation Strategies
Brady follows sound capital-allocation strategies to improve shareholder value. It uses its free resources for innovation investments, working on the automation of manufacturing facilities and rewarding shareholders through dividend payments.
In the first nine months of fiscal 2019 (ended April 30), the company paid dividends of approximately $33.5 million, higher than $32.1 million disbursed in the year-ago comparable period.
Zacks Rank & Brief on Brady’s Estimates
With a market capitalization of approximately $2.5 billion, Brady currently carries a Zacks Rank #3 (Hold). In the past 60 days, earnings estimates for the company have been lowered. Currently, the Zacks Consensus Estimates for its earnings stands at $2.39 for fiscal 2019 (ended July 2019, results not yet released) and $2.50 for fiscal 2020 (ending July 2020), reflecting declines of 0.4% and 0.4% from the respective 60-day-ago figures.
Brady Corporation Price and Consensus
Brady Corporation price-consensus-chart | Brady Corporation Quote
Also, the company’s shares have gained 2.1% against the industry’s decline of 2.8% in the past three months.
Stocks to Consider
Some better-ranked stocks in the Zacks Industrial Products sector are Roper Technologies, Inc. ROP, DXPE Enterprises, Inc. DXPE and Dover Corporation DOV. All these stocks currently carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
In the past 60 days, earnings estimates for these stocks have improved for the current year. Further, average earnings surprise for the last four quarters was 6.92% for Roper, 18.06% for DXP Enterprises and 6.91% for Dover.
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