FEDERAL SIGNAL CORP (FSS) Stock Fundamental Analysis
NYSE:FSS - New York Stock Exchange, Inc. - US3138551086 - Common Stock - Currency: USD
Taking everything into account, FSS scores 6 out of 10 in our fundamental rating. FSS was compared to 128 industry peers in the Machinery industry. FSS has outstanding health and profitabily ratings, belonging to the best of the industry. This is a solid base for any company. FSS is valied quite expensively at the moment, while it does show a decent growth rate. With these ratings, FSS could be worth investigating further for quality investing!.
1. Profitability
1.1 Basic Checks
In the past year FSS was profitable.
FSS had a positive operating cash flow in the past year.
Each year in the past 5 years FSS has been profitable.
In the past 5 years FSS always reported a positive cash flow from operatings.
1.2 Ratios
FSS has a Return On Assets of 11.24%. This is amongst the best in the industry. FSS outperforms 83.59% of its industry peers.
FSS has a Return On Equity of 17.56%. This is in the better half of the industry: FSS outperforms 77.34% of its industry peers.
FSS has a better Return On Invested Capital (14.69%) than 85.16% of its industry peers.
The Average Return On Invested Capital over the past 3 years for FSS is in line with the industry average of 10.82%.
The 3 year average ROIC (12.32%) for FSS is below the current ROIC(14.69%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.24% | ||
| ROE | 17.56% | ||
| ROIC | 14.69% |
ROA(3y)9.96%
ROA(5y)9.04%
ROE(3y)15.98%
ROE(5y)14.89%
ROIC(3y)12.32%
ROIC(5y)11.14%
1.3 Margins
FSS's Profit Margin of 11.11% is fine compared to the rest of the industry. FSS outperforms 76.56% of its industry peers.
In the last couple of years the Profit Margin of FSS has grown nicely.
FSS has a better Operating Margin (15.52%) than 73.44% of its industry peers.
In the last couple of years the Operating Margin of FSS has grown nicely.
FSS's Gross Margin of 28.83% is in line compared to the rest of the industry. FSS outperforms 45.31% of its industry peers.
In the last couple of years the Gross Margin of FSS has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 15.52% | ||
| PM (TTM) | 11.11% | ||
| GM | 28.83% |
OM growth 3Y12.91%
OM growth 5Y4.49%
PM growth 3Y11.9%
PM growth 5Y5.52%
GM growth 3Y6.36%
GM growth 5Y1.61%
2. Health
2.1 Basic Checks
FSS has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
FSS has about the same amout of shares outstanding than it did 1 year ago.
The number of shares outstanding for FSS has been increased compared to 5 years ago.
Compared to 1 year ago, FSS has an improved debt to assets ratio.
2.2 Solvency
FSS has an Altman-Z score of 9.25. This indicates that FSS is financially healthy and has little risk of bankruptcy at the moment.
With an excellent Altman-Z score value of 9.25, FSS belongs to the best of the industry, outperforming 92.19% of the companies in the same industry.
FSS has a debt to FCF ratio of 1.39. This is a very positive value and a sign of high solvency as it would only need 1.39 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 1.39, FSS belongs to the top of the industry, outperforming 80.47% of the companies in the same industry.
A Debt/Equity ratio of 0.22 indicates that FSS is not too dependend on debt financing.
With a decent Debt to Equity ratio value of 0.22, FSS is doing good in the industry, outperforming 67.97% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.22 | ||
| Debt/FCF | 1.39 | ||
| Altman-Z | 9.25 |
ROIC/WACC1.56
WACC9.44%
2.3 Liquidity
A Current Ratio of 2.39 indicates that FSS has no problem at all paying its short term obligations.
FSS's Current ratio of 2.39 is in line compared to the rest of the industry. FSS outperforms 59.38% of its industry peers.
A Quick Ratio of 1.09 indicates that FSS should not have too much problems paying its short term obligations.
FSS has a Quick ratio (1.09) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.39 | ||
| Quick Ratio | 1.09 |
3. Growth
3.1 Past
FSS shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 21.05%, which is quite impressive.
The Earnings Per Share has been growing by 13.16% on average over the past years. This is quite good.
Looking at the last year, FSS shows a quite strong growth in Revenue. The Revenue has grown by 8.06% in the last year.
Measured over the past years, FSS shows a quite strong growth in Revenue. The Revenue has been growing by 8.79% on average per year.
EPS 1Y (TTM)21.05%
EPS 3Y23.81%
EPS 5Y13.16%
EPS Q2Q%23.16%
Revenue 1Y (TTM)8.06%
Revenue growth 3Y15.34%
Revenue growth 5Y8.79%
Sales Q2Q%15.13%
3.2 Future
FSS is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 14.03% yearly.
Based on estimates for the next years, FSS will show a small growth in Revenue. The Revenue will grow by 7.43% on average per year.
EPS Next Y15.51%
EPS Next 2Y14.03%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue Next Year9.79%
Revenue Next 2Y8.43%
Revenue Next 3Y8.42%
Revenue Next 5Y7.43%
3.3 Evolution
The EPS growth rate is stable: in the next years the growth will be about the same than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 33.86, FSS can be considered very expensive at the moment.
Based on the Price/Earnings ratio, FSS is valued a bit more expensive than the industry average as 63.28% of the companies are valued more cheaply.
Compared to an average S&P500 Price/Earnings ratio of 27.24, FSS is valued a bit more expensive.
FSS is valuated quite expensively with a Price/Forward Earnings ratio of 28.69.
Compared to the rest of the industry, the Price/Forward Earnings ratio of FSS indicates a slightly more expensive valuation: FSS is more expensive than 64.06% of the companies listed in the same industry.
FSS's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 36.42.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 33.86 | ||
| Fwd PE | 28.69 |
4.2 Price Multiples
FSS's Enterprise Value to EBITDA ratio is a bit more expensive when compared to the industry. FSS is more expensive than 64.06% of the companies in the same industry.
61.72% of the companies in the same industry are cheaper than FSS, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 38.14 | ||
| EV/EBITDA | 21.13 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The excellent profitability rating of FSS may justify a higher PE ratio.
FSS's earnings are expected to grow with 14.03% in the coming years. This may justify a more expensive valuation.
PEG (NY)2.18
PEG (5Y)2.57
EPS Next 2Y14.03%
EPS Next 3YN/A
5. Dividend
5.1 Amount
FSS has a yearly dividend return of 0.46%, which is pretty low.
FSS's Dividend Yield is comparable with the industry average which is at 1.91.
With a Dividend Yield of 0.46, FSS pays less dividend than the S&P500 average, which is at 2.40.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.46% |
5.2 History
The dividend of FSS is nicely growing with an annual growth rate of 8.46%!
FSS has paid a dividend for at least 10 years, which is a reliable track record.
FSS has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)8.46%
Div Incr Years2
Div Non Decr Years10
5.3 Sustainability
14.49% of the earnings are spent on dividend by FSS. This is a low number and sustainable payout ratio.
FSS's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP14.49%
EPS Next 2Y14.03%
EPS Next 3YN/A
124.6
+2.03 (+1.66%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)
Earnings (Next)
Inst Owners103.59%
Inst Owner Change0.03%
Ins Owners1.73%
Ins Owner Change5.48%
Market Cap7.60B
Analysts76
Price Target110.77 (-11.1%)
Short Float %6.47%
Short Ratio7.34
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.46% |
Yearly Dividend0.48
Dividend Growth(5Y)8.46%
DP14.49%
Div Incr Years2
Div Non Decr Years10
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)0.84%
Min EPS beat(2)-1.15%
Max EPS beat(2)2.84%
EPS beat(4)3
Avg EPS beat(4)4.36%
Min EPS beat(4)-1.15%
Max EPS beat(4)11.51%
EPS beat(8)7
Avg EPS beat(8)6.81%
EPS beat(12)10
Avg EPS beat(12)6.55%
EPS beat(16)14
Avg EPS beat(16)7.6%
Revenue beat(2)0
Avg Revenue beat(2)-1.88%
Min Revenue beat(2)-3.02%
Max Revenue beat(2)-0.74%
Revenue beat(4)0
Avg Revenue beat(4)-1.6%
Min Revenue beat(4)-3.02%
Max Revenue beat(4)-0.13%
Revenue beat(8)3
Avg Revenue beat(8)-0.01%
Revenue beat(12)5
Avg Revenue beat(12)-0.21%
Revenue beat(16)7
Avg Revenue beat(16)0.29%
PT rev (1m)4.93%
PT rev (3m)6.68%
EPS NQ rev (1m)0%
EPS NQ rev (3m)0.64%
EPS NY rev (1m)-0.02%
EPS NY rev (3m)1.52%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0.21%
Revenue NY rev (1m)0.05%
Revenue NY rev (3m)0.24%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 33.86 | ||
| Fwd PE | 28.69 | ||
| P/S | 4 | ||
| P/FCF | 38.14 | ||
| P/OCF | 32.05 | ||
| P/B | 6.32 | ||
| P/tB | 16.43 | ||
| EV/EBITDA | 21.13 |
EPS(TTM)3.68
EY2.95%
EPS(NY)4.34
Fwd EY3.49%
FCF(TTM)3.27
FCFY2.62%
OCF(TTM)3.89
OCFY3.12%
SpS31.17
BVpS19.72
TBVpS7.58
PEG (NY)2.18
PEG (5Y)2.57
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.24% | ||
| ROE | 17.56% | ||
| ROCE | 18.43% | ||
| ROIC | 14.69% | ||
| ROICexc | 15.24% | ||
| ROICexgc | 29.28% | ||
| OM | 15.52% | ||
| PM (TTM) | 11.11% | ||
| GM | 28.83% | ||
| FCFM | 10.48% |
ROA(3y)9.96%
ROA(5y)9.04%
ROE(3y)15.98%
ROE(5y)14.89%
ROIC(3y)12.32%
ROIC(5y)11.14%
ROICexc(3y)12.94%
ROICexc(5y)11.74%
ROICexgc(3y)25.46%
ROICexgc(5y)24.23%
ROCE(3y)15.45%
ROCE(5y)13.96%
ROICexcg growth 3Y14.81%
ROICexcg growth 5Y1.2%
ROICexc growth 3Y21.22%
ROICexc growth 5Y5.23%
OM growth 3Y12.91%
OM growth 5Y4.49%
PM growth 3Y11.9%
PM growth 5Y5.52%
GM growth 3Y6.36%
GM growth 5Y1.61%
F-Score7
Asset Turnover1.01
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.22 | ||
| Debt/FCF | 1.39 | ||
| Debt/EBITDA | 0.73 | ||
| Cap/Depr | 54.78% | ||
| Cap/Sales | 1.99% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 65.11% | ||
| Profit Quality | 94.32% | ||
| Current Ratio | 2.39 | ||
| Quick Ratio | 1.09 | ||
| Altman-Z | 9.25 |
F-Score7
WACC9.44%
ROIC/WACC1.56
Cap/Depr(3y)69.74%
Cap/Depr(5y)69.95%
Cap/Sales(3y)2.54%
Cap/Sales(5y)2.67%
Profit Quality(3y)69.35%
Profit Quality(5y)76.55%
High Growth Momentum
Growth
EPS 1Y (TTM)21.05%
EPS 3Y23.81%
EPS 5Y13.16%
EPS Q2Q%23.16%
EPS Next Y15.51%
EPS Next 2Y14.03%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue 1Y (TTM)8.06%
Revenue growth 3Y15.34%
Revenue growth 5Y8.79%
Sales Q2Q%15.13%
Revenue Next Year9.79%
Revenue Next 2Y8.43%
Revenue Next 3Y8.42%
Revenue Next 5Y7.43%
EBIT growth 1Y23.12%
EBIT growth 3Y30.22%
EBIT growth 5Y13.68%
EBIT Next Year40.77%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y327.47%
FCF growth 3Y43.6%
FCF growth 5Y23.01%
OCF growth 1Y229.62%
OCF growth 3Y31.46%
OCF growth 5Y17.54%