The Brink's Company

Brink's (BCO - Snapshot Report) stock has fallen along with the rest of the market in recent weeks. However, fundamentals remain solid. Revenue rose 20% in the second quarter. It has surprised on estimates 3 out of the last 4 quarters by an average of 27.69%. Brink's has a forward P/E of 13.13.

Company Description

The Brink's Company operates two security-related businesses: Brink's, Inc. and Brink's Home Security, Inc. Brink's, Inc. provides secure transportation and cash management services. Brink's Home Security offers security alarm monitoring systems.

Brink's business model is changing. On Sep 12, the company confirmed previously announced plans to spin-off Brink's Home Security Holdings, Inc. into a stand-alone, publicly traded company as of Oct 31. Brink's shareholders will receive one share of BHS Holdings common stock for each share of Brink's that they own. BHS Holdings will trade under the symbol "CFL."

Brink's Beats Wall Street Estimates by 30% in the Second Quarter

On July 31, Brink's reported second quarter earnings that easily surprised on estimates by 30%, or 24 cents a share. Net income was $49 million, or $1.05 per share, compared to $28 million or 60 cents per share in the second quarter of 2007.

Revenue rose 20% to $932 million from $779 million a year ago mainly due to profit growth in Latin America and Europe which offset lower profits in North America. Brink's Home Security also saw higher profits as the subscriber base expanded.

The Brink's, Inc. segment saw revenues jump 21% to $798 million from $659 million a year ago. International operations were hot, as revenues increased 28%. Second-quarter revenues rose 40% in Latin America with Venezuela, Brazil and Chile seeing strong growth. Asia-Pacific lagged with revenues rising only 14% to $17 million from $15 million in 2007. Weak results in Australia hurt the numbers for the region.

North America saw growth, but revenues only gained 7% to $235 million from $219 million. The North American market dealt with higher labor and fuel prices during the quarter.

Stock Repurchase Program

During the second quarter, the company continued with its previously announced stock repurchase program by purchasing 229,000 shares for $15.7 million. In total, the company has repurchased $56.3 million of its $100 million program.

Consensus Estimates Rise for the Full Year

Covering analysts are holding estimates steady for the third quarter but have raised for the full year. Third quarter estimates are unchanged at 88 cents. Full year estimates are up 6 cents to $3.92 per share.

Value Fundamentals

Brink's has a forward P/E of 13.13. Its price-to-book is 2.33. The company has a five year return on equity (ROE) of 13.86%. Additionally, the company has a dividend yield of 0.70%.

The company reports third quarter earnings on Nov 5.

Read the full analyst report on BCO