Daily Stock Pick: Brady Corporation

This week, I'm looking at the sixth industrials representative of eight for my Ivy portfolio.

That industrials sector includes twenty-three industries all related to designing, fabricating and servicing stuff we want and use. The industrials industries range from aerospace and defense to waste management with all the transportation, business services, and equipment required in between.

Today I'm reviewing a mid-cap security and protection services company named Brady Corp. Their trading ticker symbol is BRC. I last reported on this firm on August 23, 2018.

Brady Corp provides identification solutions and workplace safety products. The company offers identification and healthcare products that are sold under the Brady brand to maintenance, repair, and operations as well as original-equipment manufacturing customers.

Products include safety signs and labeling systems, material identification systems, wire identification, patient identification, and people identification.

Brady also provides workplace safety and compliance products such as safety and compliance signs, asset tracking labels, and first-aid products. The largest end market is the United States.

Brady Corporation was founded in 1914 and is headquartered in Milwaukee, Wisconsin.

I use three key data points to gauge dividend paying equities or funds like Brady Corp:

(1) Price

(2) Dividends

(3) Returns

Besides those three, several other keys will finally unlock an equity or fund in which to invest.

Those three basic keys, however, best tell whether a company has made, is making, and will make money.

BRC Price

Brady's price per share closed at $49.38 Friday. A year ago its price was $39.05. Price jumped up $10.33 or 26.45% in the past year.

Assuming Brady's stock trades in the range of $40.00 to $52.00 this year, Brady's recent $49.38 price could rise by $0.62 and go to $50.00 by early July 2020.

BRC Dividends

Brady's most recent quarterly dividend is $0.2125 payable, July 31st.

That $0.2125 Q payout equates to an annual dividend of $0.85 which produces a yield of 1.72% based on Friday's $49.38 closing price.

Gains For BRC?

Adding the $0.85 annual estimated dividend to my $0.62 estimate of Brady's price upside shows a $1.47 potential gross annual gain, per share, which will be reduced by costs to trade those shares.

Say we pay a little under $1,000.00 today at the $49.38 recent stock price would buy 20 Brady Corp equities.

A $10 broker fee paid half at purchase and half at sale will cost us $0.50 per share.

Subtract that $0.50 brokerage cost from the estimated $1.47 gross annual gain leaves a net gain of $0.97 X 20 shares = $19.40 or a 1.95% net gain on a $987.60 investment.

Therefore, Brady Corp whose trading ticker symbol is BRC now shows a possible net gain of 1.95% including a 1.72% dividend yield.

Four brokers track Brady Corp stock:

One broker says "Buy" BRC.

Two brokers say "Hold" your BRC shares.

One broker says BRC will "underperform" peers.

Their consensus score of 2.75 equates to "hold."

Now we can look at Brady Corp and see it has made money, is making money, and could net an 1.95% gain including a 1.72% dividend yield. It could be more, it could be less.    

The above speculation is based on past year performance. The actual results remain to be seen to determine if Brady Corp is worth your time and money.

Disclosure: This article was compiled by Rydlun & ...

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