10-Q · May 18, 2026
Brady Corporation's Q3 FY 2026 results showed a robust performance with revenue reaching $435.2 million, up 13.8% year-over-year, and diluted EPS climbing to $1.21, an 11.0% increase. The company has raised its…
Earnings analysis · 10-K
BRC earnings analysis
Filed September 3, 2026 · Our reading of the company's report
The latest report
Brady delivered strong fiscal 2026 execution, with revenue up 9.8%, gross margin expanding to 51.7%, diluted EPS rising to $4.30 and operating cash flow improving to $244.1 million. Americas & Asia drove performance,…
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Brady delivered strong fiscal 2026 execution, with revenue up 9.8%, gross margin expanding to 51.7%, diluted EPS rising to $4.30 and operating cash flow improving to $244.1 million. Americas & Asia drove performance, while Europe & Australia improved profitability despite only 1.2% organic growth. The outlook is strategically compelling because PSS broadens Brady into mobile computing, scanning, printing, software and services, but the $1.4 billion acquisition, $1.6 billion of new financing and significant China exposure create substantial integration, leverage and geopolitical risk.
Gross and operating margin
How much of each revenue dollar the business keeps.
One point per quarterly or annual filing. Both margins are shares of that report's revenue.
From revenue to operating profit
Where each $100 of revenue went in this report.
Cost of sales, operating expenses, and what remained. Figures are rounded to whole dollars.
Where revenue came from
The business segments reported by the company.
Shares of the segments disclosed in this filing, largest first.
How we read each report
Our analysis across the last few reports.
Our model's reading of each filing, not the share price or the market's reaction. Annual and quarterly reports each occupy one position.
Reported figures
- Earnings per share
- $4.3
What stood out
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Strong multi-year revenue growth
Fiscal 2026 net sales increased 9.8% to $1,661.6 million from $1,513.6 million, comprising 5.3% organic growth, 2.2% acquisition growth and 2.3% foreign-currency translation. The three-year revenue trend was $1,341.4 million in fiscal 2024, $1,513.6 million in fiscal 2025 and $1,661.6 million in fiscal 2026.
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Margin recovery and EPS growth
Gross margin improved to 51.7% in fiscal 2026 from 50.3% in fiscal 2025 and 51.3% in fiscal 2024, while operating margin increased to 15.9% from 15.6% but remained below 18.1% in fiscal 2024. Diluted Class A EPS increased to $4.30 from $3.94 in fiscal 2025, versus $4.07 in fiscal 2024.
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Americas and Asia lead growth
Americas & Asia was the primary growth engine: organic sales increased 7.5%, total sales rose 11.4% to $1,106.6 million, and segment profit increased 22.3% to $256.6 million. Organic sales in the Americas grew approximately 6% and Asia grew approximately 15%, supported by wire identification, product identification, safety and facility identification, and healthcare identification.
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Broad portfolio and adjacency strategy
Brady describes its moat as a broad range of proprietary, customized and diverse products, supported by quality, service, a global footprint and multiple sales channels. Its strategy is to expand into higher-growth adjacent categories and markets, increase digital-channel sales, and build a comprehensive technology portfolio through PSS, complementing its printer and specialty adhesive materials positions.
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Expanded innovation roadmap
The product roadmap emphasizes new printing systems, pressure-sensitive materials, engraving systems, microfluidic technologies, scanners and software in fiscal 2027. R&D spending increased 17.7% to $94.0 million in fiscal 2026 from $79.9 million, indicating continued investment in innovation despite acquisition-related costs.
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Improved cash generation and returns
Operating cash flow rose to $244.1 million from $181.2 million in fiscal 2025 and $255.1 million in fiscal 2024, driven by organic growth and improved working capital management. Capital allocation included $51.5 million of property, plant and equipment spending, $46.1 million of dividends and $42.2 million of treasury-stock purchases; $44.7 million remained authorized for repurchases at July 31, 2026.
What to watch
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Large PSS integration risk
The August 3, 2026 acquisition of Honeywell’s PSS business materially increases integration complexity. Brady paid $1.4 billion in cash, expects PSS results to enter the consolidated statements after the fiscal year-end, and warns that integration may disrupt systems, product portfolios, sales channels, employees, customers and suppliers; the preliminary purchase price allocation was still incomplete at filing.
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Higher leverage and interest burden
PSS materially increases leverage and financing costs. The transaction was funded with $800 million of credit-agreement borrowings and $800 million of private-placement senior notes, including notes bearing fixed rates of 5.43%, 5.65% and 5.90%; the new credit agreement permits a temporary maximum net-leverage ratio of up to 4.00 to 1.00 for the four computation periods after closing.
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China, tariffs and component exposure
Supply-chain and geopolitical exposure increased through PSS, which has significant manufacturing operations in China and a substantial portion of global inventory in China and surrounding regions. Approximately 50% of Brady’s sales are outside the United States, tariff costs have remained above historical levels since the second half of fiscal 2025, and the company states that shortages or cost increases in electronic components, including memory and semiconductors, could reduce margins and disrupt production.
Management's outlook
The 10-K does not provide numeric fiscal 2027 revenue or EPS guidance. It states that PSS results will be integrated beginning August 3, 2026 and are expected to appear in the Form 10-Q for the quarter ended October 31, 2026. The prior fiscal 2026 adjusted EPS guidance of $5.20-$5.30 is no longer forward guidance for the completed year.
Earlier filings 4
10-Q · February 19, 2026
Brady reported quarterly net sales of $384,137,000 and diluted EPS of $1.01 for the three months ended January 31, 2026. Revenue and profitability improved year-over-year (YoY) with gross margin expanding to 50.6% and…
10-K · September 4, 2025
Brady’s 10-K emphasizes a strategy of innovation, digital channel expansion, and targeted M&A to expand into higher-growth adjacent markets; management completed three acquisitions in FY2025 and increased R&D spending.…
10-Q · May 16, 2025
Brady reported quarterly net sales of $382,590 and diluted EPS of $1.09 for the three months ended April 30, 2025, with revenue up 11.4% year-over-year but operating margin down modestly. Americas & Asia drove the…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.