Is The Brink’s Company (BCO) a Good Value Stock to Invest in?
SouthernSun Asset Management, LLC, an investment management firm, released its “SouthernSun Small Cap Strategy” first quarter 2023 investor letter. A copy of the same can be downloaded here. In the first quarter, the strategy returned 4.22% on a gross basis compared to a 2.74% return for the Russell 2000 Index and -0.66% for the Russell 2000 Value Index. Since its inception, the strategy has continued to outperform both indexes on an annualized gross and net basis. In addition, please check the top 5 holdings of the strategy to know its best pick in 2023.
SouthernSun Small Cap Strategy highlighted stocks like The Brink’s Company (NYSE:BCO) in the first quarter 2023 investor letter. Headquartered in Richmond, Virginia, The Brink’s Company (NYSE:BCO) offers security-related services like secure transportation and cash management. On May 3, 2023, The Brink’s Company (NYSE:BCO) stock closed at $60.67 per share. One-month return of The Brink’s Company (NYSE:BCO) was -6.05%, and its shares gained 7.40% of their value over the last 52 weeks. The Brink’s Company (NYSE:BCO) has a market capitalization of $2.83 billion.
SouthernSun Small Cap Strategy made the following comment about The Brink’s Company (NYSE:BCO) in its Q1 2023 investor letter:
"The Brink’s Company (NYSE:BCO), a global leader of cash and valuables management, digital retail solutions and ATM managed services, was the top contributor this quarter, driving annual organic growth up 12% year-over-year and annual organic operating profit up 23% year-over-year. Notably, the company delivered impressive gains in the Digital Retail Solutions (DRS) business with organic revenues up ~25% year-over-year and ATM Managed Services (AMS) business with organic revenues up ~50% year-over-year. The DRS and AMS businesses make up ~16% of overall company revenue and are key areas of strategic opportunity for further global expansion and improved operational efficiencies with these higher margin services. Brink’s is guiding for further growth in 2023, expecting revenues between $4,800 million to $4,950 million, a 6-8% increase over 2022, and an operating margin expansion of another 100 bps at midpoint of guidance range to about 13.1%. We have spent considerable effort getting to know the relatively new management team over recent quarters and believe Brink’s has the right team for the task at hand. The market seems to question whether cash will survive long term and the question is a fair one. In our minds, and more importantly what we see in the data, is that cash will be around for quite some time and that Brink’s has a solid foundation to generate real organic cash flow growth for years to come. All of this, combined with wise capital allocation, should deliver good value to shareholders."
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The Brink’s Company (NYSE:BCO) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 19 hedge fund portfolios held The Brink’s Company (NYSE:BCO) at the end of the fourth quarter which was 19 in the previous quarter.
We discussed The Brink’s Company (NYSE:BCO) in another article and shared Ariel Investments' views on the company in the previous quarter. In addition, please check out our hedge fund investor letters Q1 2023 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.
