Broadridge Financial Solutions (BR) reported fiscal Q3 results that topped Wall Street expectations, though slower closed sales and deal-timing delays are weighing on the near-term outlook, RBC Capital Markets said Thursday in a report.
Revenue rose to $1.95 billion and adjusted EPS reached $2.72, both ahead of estimates, RBC said. Recurring revenue increased 8%, helped by higher equity and fund positions that lifted activity in the investor communication solutions segment, the report said.
Closed sales came in light at $57.5 million, down 19% from a year earlier, as larger and more complex deals are taking longer to finalize, the report said. Broadridge also trimmed its full-year closed-sales outlook, though its pipeline remains 20% higher, RBC said.
Broadridge continues to benefit from a stable base of recurring revenue, a leading position in proxy services, and emerging opportunities in tokenization and digital transformation, the report said.
RBC reduced its price target on Broadridge stock to $200 from $245 to reflect sector rerating and near-term pressures while maintaining its outperform rating.
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