Corporate Webpages Brinks Company (The), Inc.
The Brink's Company stock is what we call a "story stock." It
has so many surprises for anyone not familiar with the company
who attempts to review it, that we can hardly hope to do it
justice here. Brink's is really Pittston Company, a coal mining
and energy company with railroad interests. Brink's before
Pittston acquired it in 1956 was a venerable old company from
the 1860's on as a delivery company. In some ways it still
retains that identity with major competitors listed as United
Parcel Service and FedEx, even though Brink's emphasizes
security aspects of delivery. After 1956, Brink's was really
part of Pittston, which is why obligations for "black lung"
pension benefits remain with the company as a result of leavings
from Pittston's energy business. Brink's ultimately became
Pittston's most profitable division, and Pittston divested
itself of its energy lands and holdings and finally changed its
name to "Brink's" in the early part of the 2000's.
Our first surprise with regard to Brink's was the way in which
it segmented its business geographically into "EMEA", followed
by North America, Latin America, and a very small chunk of Asia.
"EMEA" (Europe, Middle East, and Africa) were where the bulk of
Brink's revenues were coming from, especially from France.
The next surprise was our association of "Brink's" with home
security services frequently advertised on television, which
proved to be false. Brink's deals mainly, if not practically
exclusively, with focus on its core business of armored cars and
ATM machines. What happened to "home security" is a long story,
which was spun off into a separate company, resulting in a
plunge in the stock share price from $70/share to $20/share in
late 2008. This might be a bit misleading as shareholders got
an interest in the new Brink's Home Security Systems stock as
part of the spinoff, but the fact that the decline did not occur
in one day suggests to us that the market viewed the spinoff
very negatively. The Home Security business was one of Brink's
most profitable divisions. It also sold off a division it
purchased from Burlington Nothern Air Express (BAX) very soon after it
purchased it, suggesting poor management. But here again, the
"story" aspect as extenuating circumstances.
Brink's was the victim of what we call "shareholder activism,"
meaning large institutional or hedge fund holders of the stock
influenced the Board of Directors to mismanage the company. It
was pressured by MMI Investments LP to sell off its BAX division.
Worse, it was pressured by Pirate Capital, a 9% shareholder to
sell itself off! MMI and "Pirate" together owned almost 20% of
the company. These two lousy entities were often referred to as
"corporate raiders" and "shareholder activism" got a dirty name
from entities like that whose main desire was to plunder the
assets and were quite successful in doing so, even as Victor
Posner did ruin many venerable American companies in the 1960's.
Although Brink's (BCO) stock took a hit from loss of income due
to discontinued operations right and left, the home security
spinoff might have been timely for that division faced recession
problems and growing pains. The remaining "Brink's" seems safer
as the corporate raiders have gone their way and no longer have
much interest in the armored car services. Thus much of the
confusion is out of the way and company is free to expand.
However, we note it has substantial interests in Venezuela, a
big negative, as doing business in Hugo Chavez's country is
tatamount to suicide. He likes to nationalize or overtax Gringo
interests.
12-30-2011: Brinks Company (The), Inc. (BCO): Keeping Itself Safe from Corporate Raiders
(WAIT FOR PAGE TO LOAD COMPLETELY BEFORE LINKS WORK.)
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Bond Issue |
Zenith Index |
Under current market conditions, a Zenith Index Score of 1.20 or above is required for a positive rating on this factor. 1.21 -1.30 is considered acceptable, 1.30-1.40 is consider strong and > 1.40 is considered exceptionally strong. Accounting statements in this section often contain mistakes, especially in earlier years' totals, but data is deemed sufficient for us to give a rating. More accurate financial statements follow in the next section.
Brinks Co. (BCO ) Sector: Services
1801 Bayberry Court Industry: Security & Protection Service
PO Box 18100 Exchange: NYSE
Richmond, VA 23226-8100
The Brink's Company, together with its subsidiaries, provides secure
transportation, cash logistics, and other security-related services to
banks and financial institutions, retailers, government agencies, mints,
jewelers, and other commercial operations worldwide. Its services include
cash-in-transit armored vehicle transportation; automated teller machine
services, including cash replenishment, monitoring and forecasting
capabilities, deposit pick-up, and processing services; and secure
logistics services for valuables, including diamonds, jewelry, precious
metals, securities, currency, high-tech devices, electronics, and
pharmaceuticals. The company also provides cash logistics services,
including money processing and cash management; deploying and servicing
-ĉintelligent-Ĉ safes and safe control devices, including its patented
CompuSafe; integrated check and cash processing; and check imaging. In
addition, it offers bill payment acceptance and processing services to
utility companies and other billers; and commercial security system
services that comprise the design and installation of security systems,
including alarms, motion detectors, closed-circuit televisions, digital
video recorders, access control systems, electronic locks, and optical
turnstiles. Further, the company provides security and guarding services
to protect airports, offices, warehouses, stores, and public venues with
electronic surveillance, access control, fire prevention, and patrolling
personnel. The Brink's Company was founded in 1838 and is based in
Richmond, Virginia.
Last Trade: 27.14 52-Week Range: 34.46 - 21.53
Trade Date: 12-29 Avg. Volume: 286,579 Shares
Index Membership: Employees: 70,000
Corporate Governance:
Audit (Low Concern), Board (Low Concern), Compensation (Medium
Concern), Shareholder Rights (Medium Concern).
EPS: 1.64 Dividend Amount: $ 0.40 Yield: 1.50%
Ex-Dividend Date: Nov 9, 201 Mkt Cap: $ 1,270,000K
Payout Ratio: 25.00%
Last Split Factor (new for old): N/A Split Date: N/A
Key Statistics:
Enterprise Value: $ 1,440,000K Revenue (ttm) : $ 3,770,000K
Gross Profit: $ 585,100K
Earnings before Income Tax, Depreciation and Amortization: $ 328,400K
Enterprise Value/Revenue (ttm): 0.38 Revenue per Share: $ 78.93
Enterprise Value/EBITDA (ttm): 4.39 Qtrly Rev Growth (y to y): 28.30%
P/E Ratio (fwd projected): 13.30 P/E Ratio (current): 16.55
P/E Growth Ratio (5 yr expected): 1.30 Operating Margin: 4.89%
Price/Sales Ratio: 0.33 Profit Margin: 2.09%
Price/Book Value: 2.22 Book Value: $ 11.94/sh.
Return on Assets: 5.28% Net Income Avl to Common: $ 74,900K
Return on Equity: 15.60% Diluted Earnings/Share: $ 1.64
Qrtly Earnings Growth (yoy): 28.90%
Balance Sheet Items : Cash Flow Items (ttm):
(most recent qrtr) (trailing 12 mo.)
Total Cash: $ 200,500K Operating Cash Flow:$ 262,800K
Total Debt: $ 401,400K Lvgd Free Cash Flow:$ 72,360K
Total Debt/Equity: 64.22
Total Cash/Share: $ 4.28
Current Ratio: 1.40
Share Statistics: Stock Price History:
Shares Outstanding: 46,830K Stk 52-Week Change: 0.19%
Float: 46,410K S&P 500 52-Wk Chng: -0.66%
Sh. Short % of Float: 3.60% 50-Day Moving Avg: 25.22
Short Ratio: 5.50 200-Day Moving Avg: 26.34
% Held by Institutions: 96.30% Beta: 1.27
% Held by Insiders: 0.77%
Analysts' Estimates: Cur. Qtr Next Qtr Cur. Year Next Year
___________________________ Dec 11 Mar 12 Dec 11 Dec 12
Average Earnings Estimate 0.59 0.36 1.70 2.04
Average Revenue Estimate 0M 980M 3,930M 4,200M
Factors Comparing This Company to Its Industry Leader (1.0 = Average):
Long Term EPS Growth Rate (5 yr): 10.250 EPS Growth (Qrtly YoY): 13.667
PEG Ratio (ttm, 5 yr expected): 13.667 P/E Ratio (ttm): 2.476
Revenue Growth (Qrtly YoY): 13.667
Annual Income Statements: All numbers in thousands)
Period Ending Dec31,2010 Dec31,2009 Dec31,2008
Total Revenue 3,121,500 3,135,000 3,163,500
Cost of Revenue 2,536,400 2,534,500 2,505,100
Gross Profit 585,100 600,500 658,400
Operating Expenses:
Research & Development 0 0 0
Selling, General & Administrative 438,800 433,700 434,500
Non-Recurring Expenses 0 0 -4,600
Other Operating Expenses 0 0 0
Total Operating Expenses 0 0 0
Operating Income or Loss 146,300 166,800 228,500
Income from Continuing Operations:
Total Other Income/Expenses Net 8,100 10,800 8,100
Earnings Before Interest & Taxes 154,400 177,600 236,600
Interest Expense 14,800 11,300 12,000
Income Before Taxes 139,600 166,300 224,600
Income Tax Expense 67,100 -61,100 53,000
Minority Interest -15,700 -31,700 -39,800
Net Income from Continuing Op.s 72,500 227,400 131,800
Non-recurring Events:
Discontinued Operations 300 4,500 51,500
Extraordinary Items 0 0 0
Effect of Accounting Changes 0 0 0
Other Items 0 0 0
Net Income 57,100 200,200 183,300
Preferred Stock & Other Adjustmnts 0 0 0
Net Income Avail To Common Shares 57,100 200,200 183,300
Quarterly Income Statements: All numbers in thousands)
Period Ending Sep30,2011 Jun30,2011 Mar31,2011 Dec31,2010
Total Revenue 995,800 979,300 913,300 880,600
Cost of Revenue 807,700 808,600 757,600 696,200
Gross Profit 188,100 170,700 155,700 184,400
Operating Expenses:
Research & Development 0 0 0 0
Selling, General & Adminis. 125,600 150,300 118,700 137,500
Non-Recurring Expenses 0 0 0 0
Other Operating Expenses 0 0 0 0
Total Operating Expenses 0 0 0 0
Operating Income or Loss 62,500 20,400 37,000 46,900
Income from Continuing Operations:
Total Other Income/Expenses Net 1,300 1,100 4,400 5,400
Earnings Before Int. & Taxes 63,800 21,500 41,400 52,300
Interest Expense 6,500 5,900 5,800 5,800
Income Before Taxes 57,300 15,600 35,600 46,500
Income Tax Expense 20,900 5,600 11,400 21,000
Minority Interest -4,900 -4,700 -5,300 -6,300
Net Income from Continuing Op.s 36,400 10,000 24,200 25,500
Non-recurring Events:
Discontinued Operations -700 2,600 1,100 700
Extraordinary Items 0 0 0 0
Effect of Accounting Changes 0 0 0 0
Other Items 0 0 0 0
Net Income 30,800 7,900 20,000 19,900
Preferred Stock & Other Adj.s 0 0 0 0
Net Income Avail To Common Shs 30,800 7,900 20,000 19,900
Annual Balance Sheets: All Numbers in Thousands
Period Ending Dec31,2010 Dec31,2009 Dec31,2008
Current Assets:
Cash & Cash Equivalents 183,000 143,000 250,900
Short Term Investments 0 0 0
Net Receivables 573,400 466,100 481,800
Inventory 0 0 0
Other Current Assets 121,000 81,000 99,700
Total Current Assets 877,400 690,100 832,400
Long-Term Investments 0 0 56,600
Property, Plant & Equipt 698,900 549,500 534,000
Goodwill 244,300 213,700 139,600
Intangible Assets 83,200 69,400 21,100
Accumulated Amortization 0 0 0
Other Assets 90,700 103,000 29,500
Deferred Long Term Asset Charges 276,000 254,100 202,600
Total Assets 2,270,500 1,879,800 1,815,800
Current Liabilities:
Accounts Payable 610,500 497,000 519,500
Short/Current Long Term Debt 65,500 23,300 15,600
Other Current Liabilities 0 0 0
Total Current Liabilities 676,000 520,300 535,100
Long Term Debt 323,700 172,300 173,000
Other Liabilities 657,100 560,900 780,900
Deferred LT Liability Charges 30,600 30,500 21,500
Minority Interest 66,900 60,900 91,300
Negative Goodwill 0 0 0
Total Liabilities 1,754,300 1,344,900 1,601,800
Stockholder Equity:
Misc. Stocks Options Warrants 0 0 0
Redeemable Perferred Stock 0 0 0
Preferred Stock 0 0 0
Common Stock 46,400 47,900 45,700
Retained Earnings 537,500 514,800 310,600
Treasury Stock 0 0 0
Capital Surplus 542,600 550,200 486,300
Other Stockholder Equity -610,300 -578,000 -628,600
Total Stockholder Equity 516,200 534,900 214,000
Net Tangible Assets 188,700 251,800 53,300
Quarterly Balance Sheets: All Numbers in Thousands
Period Ending Sep30,2011 Jun30,2011 Mar31,2011 Dec31,2010
Current Assets:
Cash & Cash Equivalents 200,500 155,900 155,300 183,000
Short Term Investments 0 0 0 0
Net Receivables 607,000 645,500 612,700 573,400
Inventory 0 0 0 0
Other Current Assets 134,500 154,100 147,000 121,000
Total Current Assets 942,000 955,500 915,000 877,400
Long-Term Investments 0 0 0 0
Property, Plant & Equipt 717,800 755,700 724,300 698,900
Goodwill 238,000 258,500 252,900 244,300
Intangible Assets 69,700 77,900 83,500 83,200
Accumulated Amortization 0 0 0 0
Other Assets 84,000 87,000 82,900 90,700
Deferred LT Asset Charges 292,100 281,800 280,500 276,000
Total Assets 2,343,600 2,416,400 2,339,100 2,270,500
Current Liabilities:
Accounts Payable 631,000 664,800 604,000 610,500
Current Portion LT Debt 42,800 67,500 71,100 65,500
Other Current Liabilities 0 0 0 0
Total Current Liabilities 673,800 732,300 675,100 676,000
Long Term Debt 358,600 330,800 331,600 323,700
Other Liabilities 647,100 654,300 661,700 657,100
Deferred LT Liab. Charges 39,100 36,700 33,100 30,600
Minority Interest 66,200 67,700 72,100 66,900
Negative Goodwill 0 0 0 0
Total Liabilities 1,784,800 1,821,800 1,773,600 1,754,300
Stockholder Equity:
Misc. Options, WarrantS 0 0 0 0
Redeemable Perferred Stock 0 0 0 0
Preferred Stock 0 0 0 0
Common Stock 46,800 46,700 46,600 46,400
Retained Earnings 578,400 552,500 549,300 537,500
Treasury Stock 0 0 0 0
Capital Surplus 557,400 553,400 549,900 542,600
Other Stockholder Equity -623,800 -558,000 -580,300 -610,300
Total Stockholder Equity 558,800 594,600 565,500 516,200
Net Tangible Assets 251,100 258,200 229,100 188,700
Annual Cash Flow: All Numbers in Thousands
Period Ending Dec31,2010 Dec31,2009 Dec31,2008
Net Income 57,100 7,900 183,300
Operating Activites:
Depreciation 136,600 135,100 122,300
Adjustments to Net Income 41,300 -193,600 -43,800
Changes in Accounts Recv'bls -37,700 8,900 -24,100
Changes in Liabilities 38,900 -16,400 44,300
Changes in Inventories 0 0 0
Changes in Other Op'ing Actv's 0 5,800 145,100
Total Cash Flow fr Operations 235,300 195,200 427,100
Investing Activities:
Capital Expenditures -148,800 -170,600 -165,300
Investments -1,700 -6,400 -1,000
Other Cash Flows fr Investing 0 -64,100 -193,600
Total Cash Flows fr Investing -255,400 -241,100 -359,900
Financing Acitivies:
Dividends Paid -37,300 -32,100 -30,600
Sale or Purchase of Stock -32,400 -5,600 -40,400
Net Borrowings 132,400 -22,300 76,500
Other Cash Flows fr Financing 0 13,100 -5,100
Total Cash Flows fr Financing 60,000 -46,600 400
Effect of Exchange Rate Change 100 -15,400 -13,100
Change in Cash & Cash Equiv.s 40,000 -107,900 54,500
Quarterly Cash Flow: All Numbers in Thousands
Period Ending Sep30,2011 Jun30,2011 Mar31,2011 Dec31,2010
Net Income 30,800 7,900 20,000 19,900
Operating Activites:
Depreciation 40,500 41,200 38,800 36,600
Adjustments to Net Income -13,900 1,300 -4,600 12,100
Changes in Accounts Recv'bls 29,700 -33,700 -21,700 -8,500
Changes in Liabilities 10,500 55,000 -27,300 800
Changes in Inventories 0 0 0 0
Changes in Other Oper'g Acts 0 -1,400 -17,400 25,600
Total Cash Flow f Operations 100,700 75,000 -5,700 92,800
Investing Activities:
Capital Expenditures -47,100 -42,200 -29,400 -46,300
Investments 1,400 -300 11,000 10,100
Other Cash Flows fr Investing 0 300 -500 -88,100
Total Cash Flows fr Investing -35,600 -42,200 -18,900 -124,300
Financing Acitivies:
Dividends Paid -8,700 -15,000 -5,700 -11,100
Sale or Purchase of Stock 600 1,900 2,600 200
Net Borrowings -13,200 -21,200 -3,200 78,000
Other Cash Flows fr Financing 13,800 -200 -1,400 -200
Total Cash Flows fr Financing -7,400 -34,700 -7,200 66,900
Effect of Exchange Rate Chg 0 0 0 2,500
Change in Cash & Cash Equiv. 44,600 600 -27,700 34,500
BCO Brinks Co. [Indices near +3.0 or near zero,
or < zero bear special attention.]
P/E Ratio Tests:
Current P/E Ratio < 28? 1.6918 P/E Ratio > 5? 1.0000
P/E Ratio Vs Growth Rate: 1.9000 Forward P/E Ratio < 28? 2.1053
Sales Tests:
Price/Sales Ratio < 2.3? 3.0000 Inventory/Sales < 5%? 1.0000
Sales < $1 billion? 0.3204 Operating Margin < 7.5%? 1.5337
Balance Sheet Tests:
Debt/Equity < 0.40? 0.0062 Long-Term Debt Service: 1.5947
LTD Being Reduced? 1.2000 Short-Term Debt Service: 3.0000
Current Ratio > 2? 0.7000 Working Capital >= 1.5? 1.4306
Leverage Ratio < 20%? 1.1303 Debt / Assets < 1? 3.0000
Quick Ratio > 1? 1.1984 Inventory Turnover > 1? 1.0000
Shares Out Decreasing? 1.8000 Market Cap.> 1.5 Billion? 1.1811
Profit Margin > 7.5%? 0.2787
Income Tests:
Dividend Yield > 2.0%? 3.0000 EPS Annual Growth > 10%? -0.0600
Enterprise Value/Revenue: 0.2533 EPS 5-yr Growth > 20%? -2.8660
Enterprise Value/EBITDA: 0.6271 EPS Growth Consistent? 1.8000
EPS Qrtly Growth > 10%? 2.8900 Collection < 45 days? 0.6712
Rev. Qtrly Growth > 15%? 3.0000 Gross Pft/Cur. LTD < 1? 3.0000
EPS Annual Growth > 10%? -0.0600 Borrowing Int. Rate< 6%? 1.9220
Stock Performance Tests:
Volatility > 25%? 1.8475 % Held by Insiders < 5%? 3.0000
Beta > 1.25? 1.0160 % Held by Institut. < 50? 0.5192
50 Da MA > 200 Da MA? -0.1238 % Held by Institut. > 30? 3.0000
52-Wk Change vs. S&P 500: -0.0440 Short Ratio > 5? 1.1000
Price/Book Value < 3? 1.7800 Short % of Float > 20? 0.1800
Return on Assets > 17%? 0.3106 Average Volume > 100,000? 2.8658
Cash Flow Tests:
Oper. C.F. > Lever'd C.F: 3.0000 Positive Free Cash Flow? 1.0000
Positive Oper. Cash Flow? 1.0000 Price to C.F./sh. Ratio: 1.2537
Cash Flow / Assets >.10? 0.3088
BCO Brinks Co. Overall Zenith Index: 1.3578
Financial Statements |
Income Statement:
Balance Sheet:
Cash Flow Statement:
Financial Ratios |
. . . . . . . . . . . . 1 = Highest , 10 = Lowest
Market Grader |
Intrinsic Value (DCF) |
Intrinsic Value by Discounted Cash Flow Method:
Intrinsic Value (PEG) |
Intrinsic Value by Projected Earnings Growth Method:
Stock Scout |
We find "Scout" to be a bit biased toward the high end, so anything under a 6 is considered a negative, 6 and above, positive.
Projected Earnings |
Research Reports |
Analysts' Opinions |
Insider Activity |
Institutional Activity |
Institutional Orders to Buy or Sell:
Sentiment |
Zenith uses the "sentiment" score above or below 50 to award a positive or negative point in the Decision Matrix.
Short Interest Ratio |
As the short interest rises as a percentage of average daily share volume (Days to Cover), this is considered a measure of negative sentiment. Similarly, a decrease in that percentage is considered positive sentiment.
Stock Report |
Management's Discussion of Results of Operations Excerpts |
Moving Average Chart |
Right Time Study |
Channeling Potential |
Intraday Chart |
2 Days:
Stock Fetcher |
Point & Figure Chart |
Wall Street Analyzer |
Marketspace Chart |
Time Series Forecast |
Neural Network Prediction |
"Neurostock" can only track long trades. Therefore its performance, as tracked by itself on stocks which are consistently falling, may not appear as good as it could if each "sell" signal were a "short sale."
Ultimate Trading Systems |
The corresponding trades for the above chart are shown in tabular form below.
Recommendation |
| Factors | Weighted Points |
|---|---|
| News | + 1 |
| Comparison | + 1 |
| Industry | - 1 |
| Bond Issue | 0 |
| Zenith Index | + 1 |
| Non-GAAP vs. GAAP Earnings < 1% | - 1 |
| Cash Flow | + 1 |
| Ratios | + 1 |
| Market Grader | - 1 |
| Intrinsic Value DCF | + 1 |
| Intrinsic Value DDM | + 1 |
| Stock Scout | - 1 |
| Projected Earnings | + 1 |
| Research Reports | 0 |
| Analysts | + 1 |
| Executive Perquisites | + 1 |
| Insider Activity | - 1 |
| Institutional Activity | + 1 |
| Management Reporting | + 1 |
| Short Interest | - 1 |
| Sentiment | + 1 |
| Standard & Poor's | - 1 |
| Moving Average | + 1 |
| Right Time Study | + 1 |
| Stock Fetcher | - 1 |
| Point & Figure | + 1 |
| Wall Street Analyzer | - 1 |
| Marketspace Chart | + 1 |
| Time Series Chart | - 1 |
| Neural Network | 0 |
| Stock Options | + 1 |
| Ultimate Trading Systems | + 1 |
| Total | + 9 |
Place 1,100 shares of Brink's Company (The) (BCO) on the Active List.
