We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
BR Stock Rises 16.1% in 3 Months: Here's What You Should Know
Read MoreHide Full Article
Key Takeaways
Broadridge's recurring revenues rose 8% in fiscal 2026, backed by 98% retention and a $470M backlog.
BR targets 6-8% recurring revenue growth and 8-12% adjusted EPS growth for fiscal 2027.
Broadridge generated $1.23B in free cash flow and returned more than $1B through dividends and buybacks.
Broadridge Financial Solutions, Inc. (BR - Free Report) stock has gained 16.1% over the past three months compared with the industry’s 17.4% growth and the Zacks S&P 500 Composite's 1.9% return.
Three-Month Share Price Performance
Image Source: Zacks Investment Research
Let us delve deeper into the factors that have contributed to the company’s strong performance.
High Recurring Revenue Visibility & Durable Growth
Broadridge’s recurring revenue model provides high visibility, supported by 98% client retention and a $470 million backlog, representing about 10% of fiscal 2026 recurring revenues. Fiscal 2026 recurring revenues rose 8% on a constant-currency basis to $4.88 billion, including 6% organic growth. The sales pipeline increased more than one-third year over year, while record fourth-quarter closed sales of $158 million and continued position growth support management’s fiscal 2027 guidance for 6-8% recurring revenue growth and 8-12% adjusted EPS growth. The combination of high retention, backlog conversion and a larger pipeline should support steady organic growth over the next several years. This visibility reduces reliance on near-term market conditions and reinforces the durability of Broadridge’s earnings profile.
Margin & Earnings Rise Drive Growth Outlook
BR’s operating income increased 10% to $546.2 million in the fourth quarter of fiscal 2026, while operating margin expanded 50 basis points to 24.6%. Adjusted operating income rose 7% to $598 million, while net earnings increased 6% to $398 million and adjusted net earnings rose 5% to $442 million.
Management expects $25 million of artificial intelligence-driven productivity savings in fiscal 2027, which should help fund ongoing investments and support adjusted operating margin expansion to about 21% from 20.5% in fiscal 2026. This points to continued operating leverage and earnings growth as productivity initiatives scale.
Strong Cash Flow Supports Greater Capital Returns
Broadridge generated $1.35 billion in operating cash flow and $1.23 billion in free cash flow in fiscal 2026, representing 110% conversion of adjusted net earnings. The company returned more than $1 billion to shareholders through dividends and net share repurchases. Strong cash generation supports continued investment and acquisitions while funding shareholder returns, including a 12% dividend increase and ongoing buybacks.
View the Zacks #1 Rank List
Image: Bigstock
BR Stock Rises 16.1% in 3 Months: Here's What You Should Know
Key Takeaways
Broadridge Financial Solutions, Inc. (BR - Free Report) stock has gained 16.1% over the past three months compared with the industry’s 17.4% growth and the Zacks S&P 500 Composite's 1.9% return.
Three-Month Share Price Performance
Image Source: Zacks Investment Research
Let us delve deeper into the factors that have contributed to the company’s strong performance.
High Recurring Revenue Visibility & Durable Growth
Broadridge’s recurring revenue model provides high visibility, supported by 98% client retention and a $470 million backlog, representing about 10% of fiscal 2026 recurring revenues. Fiscal 2026 recurring revenues rose 8% on a constant-currency basis to $4.88 billion, including 6% organic growth. The sales pipeline increased more than one-third year over year, while record fourth-quarter closed sales of $158 million and continued position growth support management’s fiscal 2027 guidance for 6-8% recurring revenue growth and 8-12% adjusted EPS growth. The combination of high retention, backlog conversion and a larger pipeline should support steady organic growth over the next several years. This visibility reduces reliance on near-term market conditions and reinforces the durability of Broadridge’s earnings profile.
Margin & Earnings Rise Drive Growth Outlook
BR’s operating income increased 10% to $546.2 million in the fourth quarter of fiscal 2026, while operating margin expanded 50 basis points to 24.6%. Adjusted operating income rose 7% to $598 million, while net earnings increased 6% to $398 million and adjusted net earnings rose 5% to $442 million.
Management expects $25 million of artificial intelligence-driven productivity savings in fiscal 2027, which should help fund ongoing investments and support adjusted operating margin expansion to about 21% from 20.5% in fiscal 2026. This points to continued operating leverage and earnings growth as productivity initiatives scale.
Strong Cash Flow Supports Greater Capital Returns
Broadridge generated $1.35 billion in operating cash flow and $1.23 billion in free cash flow in fiscal 2026, representing 110% conversion of adjusted net earnings. The company returned more than $1 billion to shareholders through dividends and net share repurchases. Strong cash generation supports continued investment and acquisitions while funding shareholder returns, including a 12% dividend increase and ongoing buybacks.
BR’s Zacks Rank & Stocks to Consider
Broadridge currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
A couple of better-ranked stocks in the broader Computer and Technology sector are Analog Devices, Inc. (ADI - Free Report) and Applied Materials, Inc. (AMAT - Free Report) .
Analog Devices carries a Zacks Rank #2 (Buy) at present. It has a long-term earnings growth expectation of 25%.
ADI delivered a trailing four-quarter earnings surprise of 4.8%, on average.
Applied Materials also holds a Zacks Rank of 2 at present. It has a long-term earnings growth expectation of 28.1%.
AMAT beat earnings estimates in each of the trailing four quarters, with an average earnings surprise of 5.5%.