Broadridge: Where Is The Margin Of Safety?
Summary
- Broadridge released Q3 results May 4, 2021 and raised FY2021 guidance.
- The closing of the ~$2.5B Itivity acquisition continues to be scheduled for prior to FY2021 (June 30, 2021).
- This acquisition adds more than $6B to BR's total addressable market and should drive stronger growth, margins, and earnings.
- A new $2.55B term credit facility is to fund the acquisition. BR plans to rapidly de-lever over the next 2 years. The major rating agencies are maintaining BR's investment-grade ratings.
- While BR has a promising future, the company's valuation is too high to warrant adding to my exposure.
Analyst’s Disclosure:I am/we are long BR. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.
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