Brady Corporation (BRC - Free Report) announced rewards yesterday for its shareholders in the form of a hike in the annual dividend rate. This hike is the company’s 35th consecutive yearly increase.
The news seems to be the prime reason behind roughly 0.6% gain in its share price at the end of the trading session yesterday. The closing price was $46.11.
We believe that such shareholder-friendly policies of the company reflect a strong cash position and belief in profitability growth.
Inside the Headlines
The security services provider’s board of directors approved a 1.1% or 1 cent per share hike in the annual dividend rate on Sep 14. The rate now stands at 88 cents per share. On a quarterly basis, the dividend rate has been raised from 21.75 cents to 22 cents.
The company will pay the revised quarterly dividend on Oct 30, 2020, to shareholders of record as of Oct 9.
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 2020 (ended April 30), the company paid out dividends of $34.4 million, higher than $33.5 million disbursed in the year-ago comparable period.
Zacks Rank & Estimate Trends
With a market capitalization of $2.4 billion, Brady currently carries a Zacks Rank #3 (Hold). In the past 60 days, earnings estimates for the company have been increased. Currently, the Zacks Consensus Estimates for its earnings stands at $2.60 for fiscal 2021 (ending July 2021), reflecting an increase of 0.8% from the 60-day-ago figure.