BR

Broadridge Financial Solutions, Inc.

143.08
USD
-0.17%
143.08
USD
-0.17%
131.35 185.40
52 weeks
52 weeks

Mkt Cap 16.66B

Shares Out 116.26M

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Broadridge Financial stock dips after Spruce Point's cautious note

Broadridge Financial Solutions (NYSE:BR) stock has slipped 2.5% in Wednesday morning trading after Spruce Point Capital put out a cautious note on the investor communications and financial services tech stock, saying it sees a 65%-75% downside risk. The note comes a day after Broadridge (BR) issued materials for its 2022 annual stockholders' meeting scheduled for Nov. 10. Spruce Point has a short position in the stock. Spruce Point points out a multiyear decline in corporate issuers, broker/dealers, and institutional investors on its ecosystem, the departure of its CFO, the absence of free cash flow guidance, and an increasing rift between GAAP and non-GAAP results. "New technologies such as blockchain may also disrupt and disintermediate Broadridge (BR)," the investment manager said. Working capital has been negative in six of the last nine quarter, Spruce Point added. Furthermore, Broadridge's (BR) Code of Business Conduct and Ethics Policy has been update several times in the past three years, which Spruce Point says suggests increased regulatory scrutiny. In its fiscal Q4, though, the company's revenue and earnings topped consensus estimates and its midpoint for its FY 2023 adjusted EPS guidance range exceeded consensus. See Broadridge's cash flow over the past 10 years here. SA contributor Passive Income Pursuit sees Broadridge (BR) as a "boring but necessary business that rewards stockholders."

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