BCO - Embedded Expectations Analysis - 2020 07 08
The Brink's Company (BCO:USA) currently trades above corporate averages relative to UAFRS-based (Uniform) earnings, with a 27.2x Uniform P/E. At these levels, the market has bullish expectations for the firm, but management may be concerned about their customer base, exposure to at-risk retailers, and the potential of Brink's CompleteSpecifically, management may be overstating the stability of their financial institution and retail customers, the retail market opportunities for their Strategy 2.0 rollout, and the impact of reduced in-person retail sales transactions. Furthermore, they may be downplaying concerns about their exposure to at-risk retailers, including dine-in restaurants and mid-size customers. Meanwhile, they may be exaggerating the potential and capabilities of their CompuSafe model solution and the pricing and cost benefits of Brink's Complete. Additionally, they may have concerns about their employee layoffs, furloughs and salary reductions, the sustainability of retail demand from essential businesses, and their services-derived revenue mix
Brink's is engaged in total cash management, route-based logistics and payment solutions including cash-in-transit, automated teller machine (ATM) services, cash management services, including vault outsourcing, money processing, and safe services, and international transportation of valuables. The company's service offerings, among others, include: cash-in-transit services, which include the transportation of cash between businesses and financial institutions; ATM services, which provide customers who own and operate ATMs a variety of service options; global services, which provide transportation of commodities; and CompuSafe? service, which provides a closed-loop system.
In 2009, just as the dust was settling from the last major equity and credit market crises, we launched a boutique research firm with the intention of breaking Wall Street’s biases and broken incentives:
- GAAP and IFRS have failed to provide rules for reliable financial statement reporting
- Stock analyst recommendations are not grounded in disciplined financial analysis
- Credit agencies have been set up to grossly fail in their responsibilities to investors and the public markets
- Utter lack of willingness of major research firms to employ the the most advanced forensic analysis available
We sought to provide investors and company analysts with a source of information that changed all that.
Many years later, our business model remains because little has changed on Wall Street.
- Corporate credit ratings remain years behind the fundamental underpinnings of company performance
- Stock analysts continue to make recommendations with deeply inherent biases
- Research firms have failed to break down the walls between credit, equity, and macroeconomic research
- The governing accounting bodies have created more leeway for mis-estimates and mis-classifications as financials have become unwieldy and overwhelming
The integrity of Valens Research is founded in our disciplined processes and analytics. No “star” analysts. No corporate advisory relationships. No-nonsense opinions and recommendations.
Unfortunately, this report is not available for the investor type or country you selected.
Browse all ResearchPool reportsReport is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.