$32.10
$98.40
bear $32.10
base $57.40
bull $98.40
margin of safety $37.00
market price* $81.93
Brady makes identification and workplace-safety products - labels, signs, printers and the consumables that feed them - for industrial, healthcare and utility customers, an installed-base model that converts roughly half of revenue into gross profit. Owner earnings, meaning operating cash flow less capital spending less stock-based compensation, rose from about $1.21 per diluted share in fiscal 2015 to $2.95 in fiscal 2025 (the fiscal year ends July 31), but the path was lumpy: roughly $2.10-$2.30 through fiscal 2016-2019, $1.97 in fiscal 2020, $3.21 in fiscal 2021, a collapse to $1.25 in fiscal 2022 as inventory was built through the supply-chain squeeze, then $3.66, $3.46 and $2.95. Two figures need context - fiscal 2024 capital spending of $79.9 million included the purchase of a previously leased Mexican facility and construction in Belgium, so underlying owner earnings were nearer $4.50 a share, while fiscal 2025 cash flow was held back by inventory and receivables supporting organic growth and three acquisitions. Averaging five years at today's share count and adding back the one-time construction, we normalize owner earnings near $3.20 a share, and the first nine months of fiscal 2026 running about 27% ahead supports rather than contradicts that. The balance sheet helps: $175 million of cash against $27 million of debt at April 2026, about $3.11 a share of net cash, alongside roughly $62 million of operating lease commitments that are ordinary facility obligations rather than financial debt, and the diluted share count has drifted from 52.4 million to 47.8 million over five years. Our base case grows that $3.20 by 4.5% for a decade and 2.5% thereafter at a 9.5% discount rate, giving about $57 a share; we hold growth below the roughly 6% the last seven years delivered because organic sales grew only 2.6% in fiscal 2025 and much of the past decade's growth was purchased - $144.5 million went to acquisitions in fiscal 2025 alone - cash that our owner-earnings figure does not deduct. Our bear case starts from the fiscal 2025 actual of $2.95, allows 1% growth and 1.5% terminally at an 11.5% discount for about $32, the harsher terms reflecting that fiscal 2022 was not a macro accident but a working-capital and inventory problem specific to how this business operates, and therefore real evidence of the downside. Our bull case starts from a $3.45 run rate with 8% growth for a decade, roughly the best sustained stretch on record, a 3% terminal rate and an 8.5% discount, giving about $98. We anchor the margin-of-safety price on the base case rather than the bear, since a net-cash balance sheet, consumables-driven revenue and a controlling family with steadily rising dividends make permanent impairment unlikely, but we are only about three-quarters confident the base case holds because it leans on bolt-on acquisition skill we cannot underwrite from outside; a roughly 35% margin of safety puts the margin-of-safety price at $37. The publicly traded shares are the nonvoting class, with voting control held privately by the founding family - a governance feature to accept rather than to price away. The filing record here is complete for a full decade, so the uncertainty is about the future of the business, not about what it has already earned.