Thomas Weisel Upgrades Brady Shares

Analyst Ajit Pai says the company posted its fourth consecutive quarter of accelerating growth in sales

Thomas Weisel upgraded its investment rating on Brady Corp. (BRC to outperform. On Sept. 15, the company posted fourth-quarter earnings per share of 66 cents.

Analyst Ajit Pai says this is the fourth consecutive quarter of accelerating growth in sales, the sixth consecutive quarter of year-over-year expansion in gross margins, and the fifth quarter of year-over-year expansion in operating margins. Pai notes consensus EPS estimates for fiscal 2005 (ending July) have been revised upwards from $2.00 in January, 2004, to $2.50 currently. He says his analysis suggests this trend of upward revisions is likely to continue through fiscal 2007, driven by continued operational streamlining, better-than-expected sales growth, and additional acquisitions. He raised his $54 price target to $60. The analyst had a peer perform rating on the stock.

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