Brink’s (NYSE:BCO) Announces Earnings Results

Brink’s (NYSE:BCO) posted its quarterly earnings data on Thursday. The business services provider reported $2.54 EPS for the quarter, topping the consensus estimate of $2.47 by $0.07, FiscalAI reports. Brink’s had a return on equity of 93.16% and a net margin of 3.31%.

Here are the key takeaways from Brink’s’ conference call:

• Brink’s agreed to acquire NCR Atleos for about $6.6 billion (cash $30/sh + 0.1574 Brink’s shares), funded by cash on hand and a committed bridge facility, with closing expected in ~12 months subject to regulatory and shareholder approvals.
• Management expects $200 million of annual run-rate cost synergies within three years, the deal to be at least 35% EPS-accretive in year one, and the combined company to generate roughly $10 billion of revenue, $2 billion of adjusted EBITDA (~20% margins) and about $1 billion of annual free cash flow.
• The companies say the businesses are highly complementary — NCR Atleos’ ~600,000 ATM installed base, software and ATM-as-a-service plus Brink’s global cash logistics and route network should enable an end-to-end AMS/DRS offering, route densification and cross-sell opportunities.
• The transaction faces typical execution and regulatory risks — it requires approvals, will take ~12 months to close, and management warned of integration distraction even as they ring-fence operations and run an integration office.
• Management frames longer-term organic growth for the combined company as a resilient mid-single-digit rate while highlighting faster growth in AMS/DRS and ATM-as-a-service, and notes that potential revenue synergies were not included in the financial case.

Brink’s Price Performance

Shares of BCO traded up $6.29 during midday trading on Thursday, hitting $135.87. 547,721 shares of the company traded hands, compared to its average volume of 250,677. The stock has a market cap of $5.64 billion, a price-to-earnings ratio of 34.75 and a beta of 1.09. The firm has a 50 day moving average of $124.71 and a 200-day moving average of $117.44. The company has a debt-to-equity ratio of 9.14, a quick ratio of 1.46 and a current ratio of 1.46. Brink’s has a 52 week low of $80.10 and a 52 week high of $136.37.

Brink’s Announces Dividend

The business also recently declared a quarterly dividend, which will be paid on Monday, March 2nd. Shareholders of record on Monday, February 2nd will be paid a $0.255 dividend. The ex-dividend date is Monday, February 2nd. This represents a $1.02 annualized dividend and a yield of 0.8%. Brink’s’s payout ratio is presently 26.09%.

Insider Buying and Selling

In related news, insider Michael E. Sweeney sold 1,418 shares of the stock in a transaction that occurred on Monday, December 15th. The stock was sold at an average price of $119.50, for a total transaction of $169,451.00. Following the completion of the transaction, the insider directly owned 5,755 shares of the company’s stock, valued at approximately $687,722.50. This represents a 19.77% decrease in their ownership of the stock. The sale was disclosed in a filing with the Securities & Exchange Commission, which is accessible through this link. Insiders own 0.49% of the company’s stock.

Institutional Inflows and Outflows

A number of hedge funds and other institutional investors have recently modified their holdings of BCO. Smartleaf Asset Management LLC grew its holdings in shares of Brink’s by 150.5% in the fourth quarter. Smartleaf Asset Management LLC now owns 243 shares of the business services provider’s stock valued at $29,000 after purchasing an additional 146 shares in the last quarter. Advisory Services Network LLC bought a new position in Brink’s during the third quarter valued at $33,000. Global Retirement Partners LLC bought a new position in Brink’s during the fourth quarter valued at $39,000. Wexford Capital LP purchased a new position in shares of Brink’s in the 3rd quarter worth $42,000. Finally, EverSource Wealth Advisors LLC increased its holdings in shares of Brink’s by 161.5% in the 2nd quarter. EverSource Wealth Advisors LLC now owns 523 shares of the business services provider’s stock worth $47,000 after buying an additional 323 shares during the last quarter. 94.96% of the stock is currently owned by institutional investors.

Analysts Set New Price Targets

Separately, Truist Financial lifted their price target on shares of Brink’s from $138.00 to $163.00 and gave the company a “buy” rating in a report on Tuesday, February 10th. Two investment analysts have rated the stock with a Buy rating and one has issued a Hold rating to the company. According to data from MarketBeat.com, the stock presently has an average rating of “Moderate Buy” and an average price target of $163.00.

Key Stories Impacting Brink’s

Here are the key news stories impacting Brink’s this week:

• Positive Sentiment: Reported quarterly outperformance: Brink’s released Q4 results showing adjusted EPS of $2.54, beating consensus and revenue modestly above estimates; management highlighted organic growth and record cash generation and reduced net leverage to ~2.7x adjusted EBITDA. Read More.
• Positive Sentiment: Transformational M&A: Brink’s agreed to acquire NCR Atleos in a cash-and-stock transaction valued at ~$6.6 billion, positioning the company as a larger financial-technology infrastructure player and creating revenue/capability synergies in ATM and payments services — a likely driver of the stock rally. Read More.
• Neutral Sentiment: Strong cash flow and growth metrics were highlighted in the earnings release (cash from operations $640M; free cash flow $436M; AMS/DRS organic growth of 22%), supporting financing capacity for deals but requiring validation over time. Read More.
• Neutral Sentiment: Guidance update: the company issued Q1 revenue guidance roughly in the $1.3B–$1.4B range (near consensus); EPS guidance text in the feed was unclear — investors should watch management commentary and the conference call for clarity. (See slides/call). Read More.
• Negative Sentiment: GAAP vs. adjusted earnings nuance: one report noted a GAAP EPS figure ($1.62) that missed expectations while revenue beat, indicating non-recurring items or adjustments materially affect headline EPS — investors should parse adjusted vs. GAAP results and margins. Read More.
• Negative Sentiment: Deal-size and financing risk: a $6.6B acquisition will raise questions about how Brink’s finances the purchase (debt vs. stock), potential near-term leverage/dilution and integration execution — possible pressure on credit metrics and multiple until synergies are proven. Read More.

Brink’s announced that its Board of Directors has approved a stock repurchase program on Thursday, December 11th that authorizes the company to repurchase $750.00 million in outstanding shares. This repurchase authorization authorizes the business services provider to reacquire up to 15.4% of its stock through open market purchases. Stock repurchase programs are often an indication that the company’s leadership believes its shares are undervalued.

About Brink’s

The Brink’s Company (NYSE: BCO) is a global leader in secure logistics and cash management solutions. The company provides a comprehensive suite of services that span armored transportation, cash-in-transit (CIT), ATM services, smart safe solutions, and valuables storage. Through its network of service centers and armored vehicles, Brink’s ensures the safe and efficient movement of currency, precious metals, and other high-value assets for banks, retailers, mints, and government agencies.

Brink’s armored transport operations are complemented by technology-driven cash management offerings, including deposit automation and secure vaulting.