Brady Corp - Class A

Brady Corp. (BRC) is a leading manufacturer of ID solutions and workplace safety products. The company is allocating capital wisely by actively buying back stock, consistently increasing dividends, and pursuing tuck-in acquisitions that complement their core business, all while maintaining low leverage. This year has seen restructuring and cost-cutting efforts, with management highlighting strong growth in Aerospace and Data Center end markets. We believe the company will begin to reap the benefits of these efforts starting next year, and its recent quarterly earnings announcement showed 2026 guidance above expectations, indicating a reasonable valuation.

Brady Corp. (BRC) is a leading manufacturer of ID solutions and workplace safety products. The company is allocating capital wisely by actively buying back stock, consistently increasing dividends, and pursuing tuck-in acquisitions that complement their core business, all while maintaining low leverage. Management has highlighted strong growth in Aerospace and Data Center end markets, particularly in BRC’s wire marking business. We believe the company will begin to reap the benefits of these efforts starting next year, and its recent quarterly earnings announcement showed 2026 guidance above expectations, with the stock trading at a reasonable valuation.

Brady Corporation is listed among the top long positions of the Partnership, which focuses on smaller companies with strong competitive niches and sustainable free cash flow yields. The manager emphasizes the importance of investing in under-followed companies to maximize competitive advantage and achieve better risk-adjusted returns. However, there is no explicit directional argument made regarding Brady Corporation's future performance or valuation in the provided passages.