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Broadridge's (BR) Q3 Earnings Surpass Estimates, Up Y/Y

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Broadridge Financial Solutions, Inc. (BR - Free Report) reported mixed third-quarter fiscal 2022 results, with earnings beating the Zacks Consensus Estimate but revenues missing the same.

Adjusted earnings of $1.93 per share beat the consensus estimate by 9% and were up 9.7% year over year. Total revenues of $1.5 billion missed the consensus mark by a slight margin and were up 10.4% year over year.

Recurring fee revenues of $1 billion increased 16% from the year-ago quarter’s level. The company generated closed sales of $58 million in the quarter, up 33% year over year.

Shares of the company have lost 9.9% over the past year, against 11.1% growth of the industry it belongs to.

Let’s check out the numbers in detail.

Revenues by Segment

Revenues in the Investor Communication Solutions segment increased 6% from the year-ago quarter’s level to $1.2 billion. Global Technology and Operations segment revenues came in at $381 million, up 29% from the year-ago quarter’s figure. The improvement was mainly driven by the Itiviti acquisition and new businesses, and was partially offset by a reduction in internal trade growth.

Operating Results

Adjusted operating income of $313 million increased 10% year over year. Adjusted operating income margin stayed flat year over year at 20.4%.

Balance Sheet and Cash Flow

Broadridge exited the quarter with cash and cash equivalents of $277.2 million compared with $281.2 million at the end of the prior quarter. Long-term debt was $4.2 billion, flat with the prior-quarter tally.

The company generated $80.7 million of cash from operating activities and capex was $10.6 million in the quarter. Broadridge paid out $74.7 million in dividends in the reported quarter.

Fiscal Guidance

Broadridge expects recurring revenue growth at the higher end of 12-15%. Adjusted earnings per share growth is expected to be 13-15%. Adjusted operating income margin is estimated to be up by around 18.5%. Closed sales are anticipated between $240 million and $280 million.

Broadridge currently carries a Zacks Rank #2 (Buy).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Performance of Some Other Business Services Companies

Within the broader Business Services sector, ManpowerGroup Inc. (MAN - Free Report) ,Omnicom Group Inc. (OMC - Free Report) and Equifax Inc. (EFX - Free Report) recently reported first-quarter 2022 results.

ManpowerGroup’s quarterly results beat earnings and revenue estimates. Adjusted earnings of $1.88 per share beat the consensus mark by 20.5% and improved 69.4% year over year.

MAN’s revenues of $5.14 billion surpassed the consensus mark by 0.7% and inched up 4.5% year over year.

Omnicom reported earnings of $1.39 per share that beat the consensus mark by 8.6% and increased 4.5% year over year.

OMC’s total revenues of $3.4 billion surpassed the consensus estimate by 5.4% but declined slightly year over year.

Equifax's adjusted earnings of $2.22 per share beat the consensus estimate by 3.3% and improved 13% on a year-over-year basis. 

EFX’s revenues of $1.36 billion outpaced the consensus estimate by 2.4% and improved 12.4% year over year.

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