A month has gone by since the last earnings report for Broadridge Financial Solutions (BR Quick QuoteBR - Free Report) . Shares have added about 2.4% in that time frame, underperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is Broadridge Financial due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.

Broadridge Beats Q3 Earnings Estimates

Broadridge Financial Solutions third-quarter fiscal 2024 earnings met the Zacks Consensus Estimate, while revenues missed the same.

Adjusted earnings (adjusting 44 cents from non-recurring items) of $2.2 per share increased 8.8% from the year-ago quarter. Total revenues of $1.7 billion missed the consensus mark by 1.8% and were up 4.9% year over year.

Recurring revenues of $1.1 billion increased 4% year over year on a reported and constant-currency basis.

Revenues by Segment

Revenues in the Investor Communication Solutions segment increased 3.5% from the year-ago quarter to $1.3 billion, meeting our estimate. The Global Technology and Operations segment’s revenues amounted to $425.1 million, surpassing our estimate of $418.8 million and increasing 9.4% on a year-over-year basis.

Operating Results

Adjusted operating income of $370 million increased 7% from the year-ago quarter. This figure missed our anticipated $377.4 million. The adjusted operating margin of 21.4% increased 40 basis points from third-quarter fiscal 2023. This compares with our expectation of an adjusted operating income margin of 21.6%.

Balance Sheet and Cash Flow

Broadridge exited the quarter with cash and cash equivalents of $235.6 million compared with $277 million at the end of the preceding quarter. The long-term debt was $3.5 billion compared with $3.7 billion at the end of the second quarter of fiscal 2024.

The company generated $207.4 million of cash in operating activities and capex was $22.8 million in the quarter. It paid out $273.9 million in dividends.

Fiscal 2024 Guidance

For 2024, Broadridge expects recurring revenue growth of 6-9%. Adjusted earnings per share growth is expected to be 8-12%. The adjusted operating margin is estimated to be around 20%.

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed a downward trend in estimates revision.

VGM Scores

Currently, Broadridge Financial has a subpar Growth Score of D, a grade with the same score on the momentum front. Charting a somewhat similar path, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.

Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Broadridge Financial has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.

Performance of an Industry Player

Broadridge Financial belongs to the Zacks Outsourcing industry. Another stock from the same industry, Automatic Data Processing (ADP Quick QuoteADP - Free Report) , has gained 1.2% over the past month. More than a month has passed since the company reported results for the quarter ended March 2024.

ADP reported revenues of $5.25 billion in the last reported quarter, representing a year-over-year change of +6.6%. EPS of $2.88 for the same period compares with $2.52 a year ago.

ADP is expected to post earnings of $2.08 per share for the current quarter, representing a year-over-year change of +10.1%. Over the last 30 days, the Zacks Consensus Estimate has changed -0.6%.

ADP has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of C.