MSC INDUSTRIAL DIRECT CO-A (MSM) Stock Fundamental Analysis
USA - NYSE:MSM - US5535301064 - Common Stock
90.93 USD
+1.73 (+1.94%)
90.93 USD
0 (0%)
Overall MSM gets a fundamental rating of 5 out of 10. We evaluated MSM against 49 industry peers in the Trading Companies & Distributors industry. MSM scores excellent on profitability, but there are some minor concerns on its financial health. MSM does not seem to be growing, but still is valued expensively.
1. Profitability
1.1 Basic Checks
MSM had positive earnings in the past year.
MSM had a positive operating cash flow in the past year.
Each year in the past 5 years MSM has been profitable.
Each year in the past 5 years MSM had a positive operating cash flow.
1.2 Ratios
Looking at the Return On Assets, with a value of 8.02%, MSM is in the better half of the industry, outperforming 73.47% of the companies in the same industry.
With a decent Return On Equity value of 14.52%, MSM is doing good in the industry, outperforming 65.31% of the companies in the same industry.
MSM has a Return On Invested Capital of 13.01%. This is amongst the best in the industry. MSM outperforms 83.67% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for MSM is significantly above the industry average of 10.06%.
The last Return On Invested Capital (13.01%) for MSM is well below the 3 year average (17.86%), which needs to be investigated, but indicates that MSM had better years and this may not be a problem.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.02% | ||
| ROE | 14.52% | ||
| ROIC | 13.01% |
ROA(3y)12.15%
ROA(5y)11.16%
ROE(3y)22.31%
ROE(5y)20.98%
ROIC(3y)17.86%
ROIC(5y)16.13%
1.3 Margins
The Profit Margin of MSM (5.30%) is better than 63.27% of its industry peers.
In the last couple of years the Profit Margin of MSM has declined.
Looking at the Operating Margin, with a value of 8.49%, MSM is in line with its industry, outperforming 59.18% of the companies in the same industry.
MSM's Operating Margin has declined in the last couple of years.
With a decent Gross Margin value of 40.92%, MSM is doing good in the industry, outperforming 77.55% of the companies in the same industry.
In the last couple of years the Gross Margin of MSM has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 8.49% | ||
| PM (TTM) | 5.3% | ||
| GM | 40.92% |
OM growth 3Y0.54%
OM growth 5Y-2.24%
PM growth 3Y0.4%
PM growth 5Y-4.64%
GM growth 3Y0.04%
GM growth 5Y-0.67%
2. Health
2.1 Basic Checks
MSM has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
Compared to 1 year ago, MSM has more shares outstanding
MSM has more shares outstanding than it did 5 years ago.
The debt/assets ratio for MSM is higher compared to a year ago.
2.2 Solvency
An Altman-Z score of 5.20 indicates that MSM is not in any danger for bankruptcy at the moment.
The Altman-Z score of MSM (5.20) is better than 83.67% of its industry peers.
The Debt to FCF ratio of MSM is 1.98, which is an excellent value as it means it would take MSM, only 1.98 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of MSM (1.98) is better than 79.59% of its industry peers.
A Debt/Equity ratio of 0.21 indicates that MSM is not too dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.21, MSM is in the better half of the industry, outperforming 69.39% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.21 | ||
| Debt/FCF | 1.98 | ||
| Altman-Z | 5.2 |
ROIC/WACC1.33
WACC9.77%
2.3 Liquidity
MSM has a Current Ratio of 1.92. This is a normal value and indicates that MSM is financially healthy and should not expect problems in meeting its short term obligations.
MSM's Current ratio of 1.92 is in line compared to the rest of the industry. MSM outperforms 51.02% of its industry peers.
A Quick Ratio of 0.91 indicates that MSM may have some problems paying its short term obligations.
The Quick ratio of MSM (0.91) is worse than 65.31% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.92 | ||
| Quick Ratio | 0.91 |
3. Growth
3.1 Past
MSM shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -31.67%.
Measured over the past years, MSM shows a decrease in Earnings Per Share. The EPS has been decreasing by -2.08% on average per year.
MSM shows a decrease in Revenue. In the last year, the revenue decreased by -4.11%.
The Revenue has been growing slightly by 2.58% on average over the past years.
EPS 1Y (TTM)-31.67%
EPS 3Y-0.14%
EPS 5Y-2.08%
EPS Q2Q%-18.8%
Revenue 1Y (TTM)-4.11%
Revenue growth 3Y5.62%
Revenue growth 5Y2.58%
Sales Q2Q%-0.84%
3.2 Future
Based on estimates for the next years, MSM will show a small growth in Earnings Per Share. The EPS will grow by 6.51% on average per year.
MSM is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 3.01% yearly.
EPS Next Y-22.64%
EPS Next 2Y-6.75%
EPS Next 3Y-0.36%
EPS Next 5Y6.51%
Revenue Next Year-2.02%
Revenue Next 2Y1.13%
Revenue Next 3Y2.34%
Revenue Next 5Y3.01%
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 accelerating.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 24.64, which indicates a rather expensive current valuation of MSM.
MSM's Price/Earnings is on the same level as the industry average.
MSM's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 27.54.
With a Price/Forward Earnings ratio of 21.83, MSM is valued on the expensive side.
Compared to the rest of the industry, the Price/Forward Earnings ratio of MSM is on the same level as its industry peers.
Compared to an average S&P500 Price/Forward Earnings ratio of 23.05, MSM is valued at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.64 | ||
| Fwd PE | 21.83 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of MSM is on the same level as its industry peers.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of MSM indicates a somewhat cheap valuation: MSM is cheaper than 73.47% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 19.21 | ||
| EV/EBITDA | 13.58 |
4.3 Compensation for Growth
The decent profitability rating of MSM may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y-6.75%
EPS Next 3Y-0.36%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 3.82%, MSM has a reasonable but not impressive dividend return.
MSM's Dividend Yield is rather good when compared to the industry average which is at 1.74. MSM pays more dividend than 97.96% of the companies in the same industry.
MSM's Dividend Yield is rather good when compared to the S&P500 average which is at 2.41.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.82% |
5.2 History
The dividend of MSM has a limited annual growth rate of 5.09%.
MSM has paid a dividend for at least 10 years, which is a reliable track record.
MSM has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)5.09%
Div Incr Years3
Div Non Decr Years3
5.3 Sustainability
MSM pays out 95.14% of its income as dividend. This is not a sustainable payout ratio.
MSM's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP95.14%
EPS Next 2Y-6.75%
EPS Next 3Y-0.36%
90.93
+1.73 (+1.94%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryTrading Companies & Distributors
Earnings (Last)
Earnings (Next)
Inst Owners88.76%
Inst Owner Change3.56%
Ins Owners18.66%
Ins Owner Change4.77%
Market Cap5.06B
Analysts69.33
Price Target92.43 (1.65%)
Short Float %6.23%
Short Ratio5.48
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.82% |
Yearly Dividend3.36
Dividend Growth(5Y)5.09%
DP95.14%
Div Incr Years3
Div Non Decr Years3
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)4.24%
Min EPS beat(2)3.94%
Max EPS beat(2)4.54%
EPS beat(4)3
Avg EPS beat(4)4.91%
Min EPS beat(4)-5.6%
Max EPS beat(4)16.76%
EPS beat(8)5
Avg EPS beat(8)1.78%
EPS beat(12)7
Avg EPS beat(12)1.64%
EPS beat(16)10
Avg EPS beat(16)1.91%
Revenue beat(2)0
Avg Revenue beat(2)-1.37%
Min Revenue beat(2)-1.85%
Max Revenue beat(2)-0.9%
Revenue beat(4)1
Avg Revenue beat(4)-0.72%
Min Revenue beat(4)-1.85%
Max Revenue beat(4)1.62%
Revenue beat(8)2
Avg Revenue beat(8)-0.86%
Revenue beat(12)6
Avg Revenue beat(12)-0.17%
Revenue beat(16)7
Avg Revenue beat(16)-0.31%
PT rev (1m)0%
PT rev (3m)11.87%
EPS NQ rev (1m)0.07%
EPS NQ rev (3m)8.3%
EPS NY rev (1m)0.19%
EPS NY rev (3m)3.89%
Revenue NQ rev (1m)-0.03%
Revenue NQ rev (3m)2.01%
Revenue NY rev (1m)0.03%
Revenue NY rev (3m)0.42%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.64 | ||
| Fwd PE | 21.83 | ||
| P/S | 1.35 | ||
| P/FCF | 19.21 | ||
| P/OCF | 14.04 | ||
| P/B | 3.7 | ||
| P/tB | 9.14 | ||
| EV/EBITDA | 13.58 |
EPS(TTM)3.69
EY4.06%
EPS(NY)4.17
Fwd EY4.58%
FCF(TTM)4.73
FCFY5.21%
OCF(TTM)6.48
OCFY7.12%
SpS67.23
BVpS24.55
TBVpS9.95
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.02% | ||
| ROE | 14.52% | ||
| ROCE | 17.36% | ||
| ROIC | 13.01% | ||
| ROICexc | 13.54% | ||
| ROICexgc | 25.17% | ||
| OM | 8.49% | ||
| PM (TTM) | 5.3% | ||
| GM | 40.92% | ||
| FCFM | 7.04% |
ROA(3y)12.15%
ROA(5y)11.16%
ROE(3y)22.31%
ROE(5y)20.98%
ROIC(3y)17.86%
ROIC(5y)16.13%
ROICexc(3y)18.26%
ROICexc(5y)16.62%
ROICexgc(3y)32.65%
ROICexgc(5y)29.44%
ROCE(3y)23.83%
ROCE(5y)21.53%
ROICexcg growth 3Y8.36%
ROICexcg growth 5Y0.99%
ROICexc growth 3Y6.81%
ROICexc growth 5Y0.34%
OM growth 3Y0.54%
OM growth 5Y-2.24%
PM growth 3Y0.4%
PM growth 5Y-4.64%
GM growth 3Y0.04%
GM growth 5Y-0.67%
F-Score5
Asset Turnover1.51
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.21 | ||
| Debt/FCF | 1.98 | ||
| Debt/EBITDA | 0.7 | ||
| Cap/Depr | 110.29% | ||
| Cap/Sales | 2.6% | ||
| Interest Coverage | 12.96 | ||
| Cash Conversion | 88.85% | ||
| Profit Quality | 132.79% | ||
| Current Ratio | 1.92 | ||
| Quick Ratio | 0.91 | ||
| Altman-Z | 5.2 |
F-Score5
WACC9.77%
ROIC/WACC1.33
Cap/Depr(3y)111.09%
Cap/Depr(5y)95.87%
Cap/Sales(3y)2.19%
Cap/Sales(5y)1.94%
Profit Quality(3y)117.22%
Profit Quality(5y)113.93%
High Growth Momentum
Growth
EPS 1Y (TTM)-31.67%
EPS 3Y-0.14%
EPS 5Y-2.08%
EPS Q2Q%-18.8%
EPS Next Y-22.64%
EPS Next 2Y-6.75%
EPS Next 3Y-0.36%
EPS Next 5Y6.51%
Revenue 1Y (TTM)-4.11%
Revenue growth 3Y5.62%
Revenue growth 5Y2.58%
Sales Q2Q%-0.84%
Revenue Next Year-2.02%
Revenue Next 2Y1.13%
Revenue Next 3Y2.34%
Revenue Next 5Y3.01%
EBIT growth 1Y-26.43%
EBIT growth 3Y6.19%
EBIT growth 5Y0.29%
EBIT Next Year-1%
EBIT Next 3Y5.41%
EBIT Next 5Y6.87%
FCF growth 1Y-55.88%
FCF growth 3Y22.15%
FCF growth 5Y2.39%
OCF growth 1Y-46.8%
OCF growth 3Y22.3%
OCF growth 5Y4.57%