Broadridge Financial Solutions: The Essential Business Nobody Knows

Dividends Forever
3 min readJul 25, 2022

Broadridge Financial Solutions ($BR) is a service that many investors use, without even realizing it. This is an essential business, but one most people have never heard of.

In today’s article, we’ll look at what Broadridge does and why it’s an interesting investment.

What Does Broadridge Financial Solutions Do?

Broadridge Powers Many Shareholder Meetings — Including Colgate’s

Broadridge Financial Solutions distributes investment material to stock owners. The majority of their revenue comes from issuing proxy statements and managing shareholder voting rights.

The company is also involved in numerous important back-end financial activities like stock transfers, SEC disclosures, and trade confirmations.

Broadridge handles the boring-but-necessary elements of being a publically traded company. Big businesses outsource things like proxy voting or corporate action announcements to Broadridge, creating predictable and stable cash flow.

In fact, the company collected $3.3 billion in recurring revenue during 2021.

Key Investment Metrics

Financial technology stocks are generally high-fliers and incredibly speculative. Broadridge Financial Solutions is not.

This is a solid business with healthy cash flow and a growing dividend.

Looking at the metrics on Seeking Alpha, we can see that Broadridge Financial Solutions meet most of the requirements for being a quality dividend stock.

Source — Seeking Alpha

Broadridge has a current PE ratio of 23.93. The stock yields a 1.64% annualized dividend. The payout ratio is well under 50%, giving the company room for further dividend growth. And the 5-year compound annual dividend growth rate is 14.17% — enormous and a clear inflation beater.

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