Why the dividend investor may take a look at MSC INDUSTRIAL DIRECT CO-A (NYSE:MSM).

Take a closer look at MSC INDUSTRIAL DIRECT CO-A (NYSE:MSM), a stock of interest to dividend investors uncovered by our stock screener. MSM excels in fundamentals and provides a decent dividend, all while maintaining a reasonable valuation. Let's break it down further.

Dividend Assessment of MSM

ChartMill assigns a proprietary Dividend Rating to each stock. The score is computed by evaluating various valuation aspects, like the yield, the history, the dividend growth and sustainability. MSM was assigned a score of 7 for dividend:

• With a Yearly Dividend Yield of 4.36%, MSM is a good candidate for dividend investing.
• Compared to an average industry Dividend Yield of 3.07, MSM pays a better dividend. On top of this MSM pays more dividend than 91.84% of the companies listed in the same industry.
• Compared to an average S&P500 Dividend Yield of 2.44, MSM pays a better dividend.
• MSM has paid a dividend for at least 10 years, which is a reliable track record.
• MSM's earnings are growing more than its dividend. This makes the dividend growth sustainable.

What does the Health looks like for MSM

A critical element of ChartMill's stock evaluation is the Health Rating, which spans from 0 to 10. This rating considers multiple health factors, including liquidity and solvency, both in absolute terms and relative to industry peers. MSM has received a 5 out of 10:

• An Altman-Z score of 4.80 indicates that MSM is not in any danger for bankruptcy at the moment.
• With a decent Altman-Z score value of 4.80, MSM is doing good in the industry, outperforming 77.55% of the companies in the same industry.
• MSM has a debt to FCF ratio of 1.79. This is a very positive value and a sign of high solvency as it would only need 1.79 years to pay back of all of its debts.
• Looking at the Debt to FCF ratio, with a value of 1.79, MSM is in the better half of the industry, outperforming 77.55% of the companies in the same industry.
• MSM has a Debt/Equity ratio of 0.22. This is a healthy value indicating a solid balance between debt and equity.
• MSM's Debt to Equity ratio of 0.22 is fine compared to the rest of the industry. MSM outperforms 65.31% of its industry peers.

Understanding MSM's Profitability

ChartMill's Profitability Rating offers a unique perspective on stock analysis, providing scores from 0 to 10. These ratings consider a wide range of profitability metrics and margins, both in comparison to industry peers and on their own merits. For MSM, the assigned 7 is a significant indicator of profitability:

• MSM's Return On Assets of 8.66% is fine compared to the rest of the industry. MSM outperforms 75.51% of its industry peers.
• MSM's Return On Equity of 15.73% is fine compared to the rest of the industry. MSM outperforms 65.31% of its industry peers.
• With an excellent Return On Invested Capital value of 14.01%, MSM belongs to the best of the industry, outperforming 85.71% of the companies in the same industry.
• The Average Return On Invested Capital over the past 3 years for MSM is significantly above the industry average of 8.96%.
• With a decent Profit Margin value of 5.69%, MSM is doing good in the industry, outperforming 63.27% of the companies in the same industry.
• With a decent Operating Margin value of 9.17%, MSM is doing good in the industry, outperforming 61.22% of the companies in the same industry.
• MSM's Gross Margin of 40.90% is fine compared to the rest of the industry. MSM outperforms 73.47% of its industry peers.

Our Best Dividend screener lists more Best Dividend stocks and is updated daily.

Our latest full fundamental report of MSM contains the most current fundamental analsysis.

Keep in mind

This is not investing advice! The article highlights some of the observations at the time of writing, but you should always make your own analysis and invest based on your own insights.