The end of the earnings season is always a good time to take a step back and see who shined (and who not so much). Let’s take a look at how safety & security services stocks fared in Q1, starting with Brady (NYSE: BRC).
Rising concerns over physical security, cybersecurity threats, and workplace safety regulations will present opportunities for companies in this sector. AI and digitization will enhance surveillance, access control, and threat detection, which could benefit key players in Safety & Security Services. These trends could also introduce ethical and regulatory concerns over data privacy and automated decision-making in security operations, giving rise to headline risks. Finally, increasing scrutiny on private security practices and evolving criminal justice policies again mean that companies in the space need to operate with the utmost care or risk being the poster child of abuse of power.
The 5 safety & security services stocks we track reported a satisfactory Q1. As a group, revenues beat analysts’ consensus estimates by 1.5% while next quarter’s revenue guidance was in line.
Amidst this news, share prices of the companies have had a rough stretch. On average, they are down 8.1% since the latest earnings results.
Brady (NYSE: BRC)
Founded in 1914 and evolving through more than a century of industrial innovation, Brady (NYSE: BRC) manufactures and supplies identification solutions and workplace safety products that help companies identify and protect their premises, products, and people.
Brady reported revenues of $382.6 million, up 11.4% year on year. This print fell short of analysts’ expectations by 1%. Overall, it was a slower quarter for the company with a slight miss of analysts’ full-year EPS guidance estimates.
Commentary:“Our organic sales growth in the Americas & Asia region was strong this quarter, which was driven by our increased investments in research and development and new product launches over the last several years. The result was a new all-time company record quarter of adjusted earnings per share,” said Brady’s President and Chief Executive Officer, Russell R. Shaller.
Brady pulled off the fastest revenue growth of the whole group. Still, the market seems discontent with the results. The stock is down 8.6% since reporting and currently trades at $67.22.
Read our full report on Brady here, it’s free.
Best Q1: CoreCivic (NYSE: CXW)
Originally founded in 1983 as the first private prison company in the United States, CoreCivic (NYSE: CXW) operates correctional facilities, detention centers, and residential reentry programs for government agencies across the United States.
CoreCivic reported revenues of $488.6 million, down 2.4% year on year, outperforming analysts’ expectations by 2.5%. The business had an exceptional quarter with a solid beat of analysts’ EPS estimates.
The market seems unhappy with the results as the stock is down 8.6% since reporting. It currently trades at $20.67.
Is now the time to buy CoreCivic? Access our full analysis of the earnings results here, it’s free.
Weakest Q1: GEO Group (NYSE: GEO)
With a global footprint spanning three continents and approximately 81,000 beds across 100 facilities, GEO Group (NYSE: GEO) operates secure facilities, processing centers, and reentry services for government agencies in the United States, Australia, and South Africa.
GEO Group reported revenues of $604.6 million, flat year on year, falling short of analysts’ expectations by 2%. It was a disappointing quarter as it posted a significant miss of analysts’ EPS estimates.
GEO Group delivered the weakest performance against analyst estimates in the group. As expected, the stock is down 19.6% since the results and currently trades at $24.35.
Read our full analysis of GEO Group’s results here.
Brink's (NYSE: BCO)
Known for its iconic armored trucks that have been a fixture in American cities since 1859, Brink's (NYSE: BCO) provides secure transportation and management of cash and valuables for banks, retailers, and other businesses worldwide.
Brink's reported revenues of $1.25 billion, flat year on year. This result topped analysts’ expectations by 2.8%. Aside from that, it was a satisfactory quarter as it also logged a solid beat of analysts’ EPS estimates but a significant miss of analysts’ EPS guidance for next quarter estimates.
The stock is down 7.7% since reporting and currently trades at $87.10.
Read our full, actionable report on Brink's here, it’s free.
MSA Safety (NYSE: MSA)
Founded in 1914 as Mine Safety Appliances to protect coal miners from dangerous gases, MSA Safety (NYSE: MSA) designs and manufactures advanced safety products that protect workers and facilities across industries including fire service, energy, construction, and manufacturing.
MSA Safety reported revenues of $421.3 million, up 1.9% year on year. This number beat analysts’ expectations by 5%. Overall, it was an exceptional quarter as it also logged a solid beat of analysts’ EPS estimates.
MSA Safety pulled off the biggest analyst estimates beat among its peers. The stock is up 7.3% since reporting and currently trades at $165.12.
Read our full, actionable report on MSA Safety here, it’s free.
Market Update
As a result of the Fed’s rate hikes in 2022 and 2023, inflation has come down from frothy levels post-pandemic. The general rise in the price of goods and services is trending towards the Fed’s 2% goal as of late, which is good news. The higher rates that fought inflation also didn't slow economic activity enough to catalyze a recession. So far, soft landing. This, combined with recent rate cuts (half a percent in September 2024 and a quarter percent in November 2024) have led to strong stock market performance in 2024. The icing on the cake for 2024 returns was Donald Trump’s victory in the U.S. Presidential Election in early November, sending major indices to all-time highs in the week following the election. Still, debates around the health of the economy and the impact of potential tariffs and corporate tax cuts remain, leaving much uncertainty around 2025.
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