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 quite expensive at the moment. It does show a decent growth rate. These ratings would make FSS suitable for quality investing!
1. Profitability
1.1 Basic Checks
In the past year FSS was profitable.
In the past year FSS had a positive cash flow from operations.
In the past 5 years FSS has always been profitable.
In the past 5 years FSS always reported a positive cash flow from operatings.
1.2 Ratios
FSS's Return On Assets of 11.24% is amongst the best of the industry. FSS outperforms 82.81% of its industry peers.
With a decent Return On Equity value of 17.56%, FSS is doing good in the industry, outperforming 75.78% of the companies in the same industry.
With an excellent Return On Invested Capital value of 14.69%, FSS belongs to the best of the industry, outperforming 85.16% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for FSS is in line with the industry average of 10.72%.
The last Return On Invested Capital (14.69%) for FSS is above the 3 year average (12.32%), which is a sign of increasing profitability.
| 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 has a better Profit Margin (11.11%) than 75.78% of its industry peers.
FSS's Profit Margin has improved in the last couple of years.
FSS's Operating Margin of 15.52% is fine compared to the rest of the industry. FSS outperforms 73.44% of its industry peers.
In the last couple of years the Operating Margin of FSS has grown nicely.
Looking at the Gross Margin, with a value of 28.83%, FSS is in line with its industry, outperforming 44.53% of the companies in the same industry.
FSS's Gross Margin has improved in the last couple of years.
| 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
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), FSS is creating some value.
Compared to 1 year ago, FSS has about the same amount of shares outstanding.
The number of shares outstanding for FSS has been increased compared to 5 years ago.
The debt/assets ratio for FSS has been reduced compared to a year ago.
2.2 Solvency
An Altman-Z score of 8.08 indicates that FSS is not in any danger for bankruptcy at the moment.
FSS has a better Altman-Z score (8.08) than 89.84% of its industry peers.
The Debt to FCF ratio of FSS is 1.39, which is an excellent value as it means it would take FSS, only 1.39 years of fcf income to pay off 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.
FSS has a Debt/Equity ratio of 0.22. This is a healthy value indicating a solid balance between debt and equity.
With a decent Debt to Equity ratio value of 0.22, FSS is doing good in the industry, outperforming 69.53% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.22 | ||
| Debt/FCF | 1.39 | ||
| Altman-Z | 8.08 |
ROIC/WACC1.47
WACC10.03%
2.3 Liquidity
A Current Ratio of 2.39 indicates that FSS has no problem at all paying its short term obligations.
Looking at the Current ratio, with a value of 2.39, FSS is in the better half of the industry, outperforming 60.94% of the companies in the same industry.
FSS has a Quick Ratio of 1.09. This is a normal value and indicates that FSS is financially healthy and should not expect problems in meeting its short term obligations.
FSS has a Quick ratio of 1.09. This is comparable to the rest of the industry: FSS outperforms 40.63% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.39 | ||
| Quick Ratio | 1.09 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 25.36% over the past year.
Measured over the past years, FSS shows a quite strong growth in Earnings Per Share. The EPS has been growing by 13.16% on average per year.
Looking at the last year, FSS shows a small growth in Revenue. The Revenue has grown by 7.85% in the last year.
FSS shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 8.79% yearly.
EPS 1Y (TTM)25.36%
EPS 3Y23.81%
EPS 5Y13.16%
EPS Q2Q%18.75%
Revenue 1Y (TTM)7.85%
Revenue growth 3Y15.34%
Revenue growth 5Y8.79%
Sales Q2Q%9.16%
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.
FSS is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 7.43% yearly.
EPS Next Y15.54%
EPS Next 2Y14.03%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue Next Year9.74%
Revenue Next 2Y8.43%
Revenue Next 3Y7.04%
Revenue Next 5Y7.43%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
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 29.20, FSS can be considered very expensive at the moment.
Compared to the rest of the industry, the Price/Earnings ratio of FSS indicates a slightly more expensive valuation: FSS is more expensive than 61.72% of the companies listed in the same industry.
FSS is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 26.35, which is the current average of the S&P500 Index.
With a Price/Forward Earnings ratio of 23.26, FSS is valued on the expensive side.
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 60.16% of the companies listed in the same industry.
When comparing the Price/Forward Earnings ratio of FSS to the average of the S&P500 Index (22.19), we can say FSS is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 29.2 | ||
| Fwd PE | 23.26 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, FSS is valued a bit more expensive than the industry average as 60.16% of the companies are valued more cheaply.
60.16% 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 | 30.92 | ||
| EV/EBITDA | 17.53 |
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)1.88
PEG (5Y)2.22
EPS Next 2Y14.03%
EPS Next 3YN/A
5. Dividend
5.1 Amount
With a yearly dividend of 0.55%, FSS is not a good candidate for dividend investing.
FSS's Dividend Yield is comparable with the industry average which is at 1.93.
Compared to an average S&P500 Dividend Yield of 2.42, FSS's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.55% |
5.2 History
The dividend of FSS is nicely growing with an annual growth rate of 8.46%!
FSS has been paying a dividend for at least 10 years, so it has a reliable track record.
FSS has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)8.46%
Div Incr Years2
Div Non Decr Years10
5.3 Sustainability
FSS pays out 14.49% of its income as dividend. This is a 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
101.03
-1.15 (-1.13%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)
Earnings (Next)
Inst Owners103.59%
Inst Owner Change3.45%
Ins Owners1.73%
Ins Owner Change5.48%
Market Cap6.16B
Analysts80
Price Target105.57 (4.49%)
Short Float %8.5%
Short Ratio9.31
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.55% |
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)1.27%
PT rev (3m)2.07%
EPS NQ rev (1m)0%
EPS NQ rev (3m)1.05%
EPS NY rev (1m)0%
EPS NY rev (3m)2.16%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0.28%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.19%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 29.2 | ||
| Fwd PE | 23.26 | ||
| P/S | 3.24 | ||
| P/FCF | 30.92 | ||
| P/OCF | 25.99 | ||
| P/B | 5.12 | ||
| P/tB | 13.32 | ||
| EV/EBITDA | 17.53 |
EPS(TTM)3.46
EY3.42%
EPS(NY)4.34
Fwd EY4.3%
FCF(TTM)3.27
FCFY3.23%
OCF(TTM)3.89
OCFY3.85%
SpS31.17
BVpS19.72
TBVpS7.58
PEG (NY)1.88
PEG (5Y)2.22
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 | 8.08 |
F-Score7
WACC10.03%
ROIC/WACC1.47
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)25.36%
EPS 3Y23.81%
EPS 5Y13.16%
EPS Q2Q%18.75%
EPS Next Y15.54%
EPS Next 2Y14.03%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue 1Y (TTM)7.85%
Revenue growth 3Y15.34%
Revenue growth 5Y8.79%
Sales Q2Q%9.16%
Revenue Next Year9.74%
Revenue Next 2Y8.43%
Revenue Next 3Y7.04%
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%