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FSS

Federal Signal NYSE:FSS Stock Report

Last Price

US$42.44

Market Cap

US$2.6b

7D

-0.4%

1Y

7.1%

Updated

19 Aug, 2022

Data

Company Financials +
FSS fundamental analysis
Snowflake Score
Valuation2/6
Future Growth2/6
Past Performance2/6
Financial Health6/6
Dividends1/6

FSS Stock Overview

Federal Signal Corporation, together with its subsidiaries, designs, manufactures, and supplies a suite of products and integrated solutions for municipal, governmental, industrial, and commercial customers in the United States, Canada, Europe, and internationally.

Rewards

Trading at 48.6% below our estimate of its fair value

Earnings are forecast to grow 19.53% per year

Risk Analysis

No risks detected for FSS from our risk checks.

Federal Signal Competitors

Price History & Performance

Summary of all time highs, changes and price drops for Federal Signal
Historical stock prices
Current Share PriceUS$42.44
52 Week HighUS$48.88
52 Week LowUS$31.86
Beta0.96
1 Month Change14.06%
3 Month Change26.69%
1 Year Change7.15%
3 Year Change46.35%
5 Year Change131.91%
Change since IPO503.89%

Recent News & Updates

Aug 17
Federal Signal (NYSE:FSS) Has A Pretty Healthy Balance Sheet

Federal Signal (NYSE:FSS) Has A Pretty Healthy Balance Sheet

Warren Buffett famously said, 'Volatility is far from synonymous with risk.' So it seems the smart money knows that...

Jul 27

Federal Signal Non-GAAP EPS of $0.53 beats by $0.06, revenue of $367M beats by $2.2M

Federal Signal press release (NYSE:FSS): Q2 Non-GAAP EPS of $0.53 beats by $0.06. Revenue of $367M (+9.7% Y/Y) beats by $2.2M. Orders of $413 million, up $53 million, or 15%, from last year Record backlog of $795 million, up $358 million, or 82%, from last year. Raises mid-point of 2022 adjusted EPS* outlook by establishing a new range of $1.85 to $2.00, updated from the previous range of $1.80 to $2.00.

Shareholder Returns

FSSUS MachineryUS Market
7D-0.4%1.4%1.4%
1Y7.1%-6.9%-8.4%

Return vs Industry: FSS exceeded the US Machinery industry which returned -6.9% over the past year.

Return vs Market: FSS exceeded the US Market which returned -8.4% over the past year.

Price Volatility

Is FSS's price volatile compared to industry and market?
FSS volatility
FSS Average Weekly Movement3.9%
Machinery Industry Average Movement5.8%
Market Average Movement7.6%
10% most volatile stocks in US Market17.1%
10% least volatile stocks in US Market3.1%

Stable Share Price: FSS is less volatile than 75% of US stocks over the past 3 months, typically moving +/- 4% a week.

Volatility Over Time: FSS's weekly volatility (4%) has been stable over the past year.

About the Company

FoundedEmployeesCEOWebsite
19013,900Jennifer Shermanhttps://www.federalsignal.com

Federal Signal Corporation, together with its subsidiaries, designs, manufactures, and supplies a suite of products and integrated solutions for municipal, governmental, industrial, and commercial customers in the United States, Canada, Europe, and internationally. It operates through Environmental Solutions Group, and Safety and Security Systems Group. The Environmental Solutions Group segment offers a range of street sweepers, safe-digging trucks ,sewer cleaners, industrial vacuum loaders, vacuum, and hydro-excavation trucks; road-marking, line-removal and waterblasting equipment, dump truck bodies, trailers, and metal extraction support equipment under the Elgin, Vactor, Guzzler, TRUVAC, Westech, Jetstream, Mark Rite Lines, Ox Bodies, Crysteel, J-Craft, Duraclass, Rugby, Travis, OSW, NTE, WTB, Ground Force, Bucks, and Switch-N-Go brand names.

Federal Signal Fundamentals Summary

How do Federal Signal's earnings and revenue compare to its market cap?
FSS fundamental statistics
Market CapUS$2.57b
Earnings (TTM)US$102.70m
Revenue (TTM)US$1.30b

25.1x

P/E Ratio

2.0x

P/S Ratio

Earnings & Revenue

Key profitability statistics from the latest earnings report
FSS income statement (TTM)
RevenueUS$1.30b
Cost of RevenueUS$992.80m
Gross ProfitUS$303.80m
Other ExpensesUS$201.10m
EarningsUS$102.70m

Last Reported Earnings

Jun 30, 2022

Next Earnings Date

n/a

Earnings per share (EPS)1.69
Gross Margin23.43%
Net Profit Margin7.92%
Debt/Equity Ratio40.1%

How did FSS perform over the long term?

See historical performance and comparison

Dividends

0.8%

Current Dividend Yield

21%

Payout Ratio
We’ve recently updated our valuation analysis.

Valuation

Is FSS undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

2/6

Valuation Score 2/6

  • Price-To-Earnings vs Peers

  • Price-To-Earnings vs Industry

  • Price-To-Earnings vs Fair Ratio

  • Below Fair Value

  • Significantly Below Fair Value

  • Analyst Forecast

Key Valuation Metric

Which metric is best to use when looking at relative valuation for FSS?

Other financial metrics that can be useful for relative valuation.

FSS key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue2.2x
Enterprise Value/EBITDA15.3x
PEG Ratio1.3x

Price to Earnings Ratio vs Peers

How does FSS's PE Ratio compare to its peers?

FSS PE Ratio vs Peers
The above table shows the PE ratio for FSS vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyPEEstimated GrowthMarket Cap
Peer Average19.4x
TEX Terex
10.7x7.2%US$2.5b
ALSN Allison Transmission Holdings
8x0.1%US$3.8b
ALG Alamo Group
19.6x16.4%US$1.6b
TRN Trinity Industries
39.1x78.5%US$2.2b
FSS Federal Signal
25.1x19.5%US$2.6b

Price-To-Earnings vs Peers: FSS is expensive based on its Price-To-Earnings Ratio (25.1x) compared to the peer average (19.4x).


Price to Earnings Ratio vs Industry

How does FSS's PE Ratio compare vs other companies in the US Machinery Industry?

Price-To-Earnings vs Industry: FSS is expensive based on its Price-To-Earnings Ratio (25.1x) compared to the US Machinery industry average (22.5x)


Price to Earnings Ratio vs Fair Ratio

What is FSS's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

FSS PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio25.1x
Fair PE Ratio20.6x

Price-To-Earnings vs Fair Ratio: FSS is expensive based on its Price-To-Earnings Ratio (25.1x) compared to the estimated Fair Price-To-Earnings Ratio (20.6x).


Share Price vs Fair Value

What is the Fair Price of FSS when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: FSS ($42.44) is trading below our estimate of fair value ($82.55)

Significantly Below Fair Value: FSS is trading below fair value by more than 20%.


Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

Analyst Forecast: Target price is less than 20% higher than the current share price.


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Future Growth

How is Federal Signal forecast to perform in the next 1 to 3 years based on estimates from 7 analysts?

Future Growth Score

2/6

Future Growth Score 2/6

  • Earnings vs Savings Rate

  • Earnings vs Market

  • High Growth Earnings

  • Revenue vs Market

  • High Growth Revenue

  • Future ROE


19.5%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: FSS's forecast earnings growth (19.5% per year) is above the savings rate (1.9%).

Earnings vs Market: FSS's earnings (19.5% per year) are forecast to grow faster than the US market (14.4% per year).

High Growth Earnings: FSS's earnings are forecast to grow, but not significantly.

Revenue vs Market: FSS's revenue (7.7% per year) is forecast to grow slower than the US market (7.8% per year).

High Growth Revenue: FSS's revenue (7.7% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: Insufficient data to determine if FSS's Return on Equity is forecast to be high in 3 years time


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Past Performance

How has Federal Signal performed over the past 5 years?

Past Performance Score

2/6

Past Performance Score 2/6

  • Quality Earnings

  • Growing Profit Margin

  • Earnings Trend

  • Accelerating Growth

  • Earnings vs Industry

  • High ROE


10.9%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: FSS has high quality earnings.

Growing Profit Margin: FSS's current net profit margins (7.9%) are lower than last year (8.7%).


Past Earnings Growth Analysis

Earnings Trend: FSS's earnings have grown by 10.9% per year over the past 5 years.

Accelerating Growth: FSS's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: FSS had negative earnings growth (-0.5%) over the past year, making it difficult to compare to the Machinery industry average (9.4%).


Return on Equity

High ROE: FSS's Return on Equity (12.7%) is considered low.


Discover strong past performing companies

Financial Health

How is Federal Signal's financial position?

Financial Health Score

6/6

Financial Health Score 6/6

  • Short Term Liabilities

  • Long Term Liabilities

  • Debt Level

  • Reducing Debt

  • Debt Coverage

  • Interest Coverage

Financial Position Analysis

Short Term Liabilities: FSS's short term assets ($479.9M) exceed its short term liabilities ($179.7M).

Long Term Liabilities: FSS's short term assets ($479.9M) exceed its long term liabilities ($455.0M).


Debt to Equity History and Analysis

Debt Level: FSS's net debt to equity ratio (36.3%) is considered satisfactory.

Reducing Debt: FSS's debt to equity ratio has reduced from 69.9% to 40.1% over the past 5 years.

Debt Coverage: FSS's debt is well covered by operating cash flow (26.2%).

Interest Coverage: FSS's interest payments on its debt are well covered by EBIT (24.7x coverage).


Balance Sheet


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Dividend

What is Federal Signal current dividend yield, its reliability and sustainability?

Dividend Score

1/6

Dividend Score 1/6

  • Notable Dividend

  • High Dividend

  • Stable Dividend

  • Growing Dividend

  • Earnings Coverage

  • Cash Flow Coverage


0.85%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: FSS's dividend (0.85%) isn’t notable compared to the bottom 25% of dividend payers in the US market (1.47%).

High Dividend: FSS's dividend (0.85%) is low compared to the top 25% of dividend payers in the US market (3.97%).


Stability and Growth of Payments

Stable Dividend: Whilst dividend payments have been stable, FSS has been paying a dividend for less than 10 years.

Growing Dividend: FSS's dividend payments have increased, but the company has only paid a dividend for 8 years.


Earnings Payout to Shareholders

Earnings Coverage: With its low payout ratio (21.3%), FSS's dividend payments are well covered by earnings.


Cash Payout to Shareholders

Cash Flow Coverage: With its high cash payout ratio (142.7%), FSS's dividend payments are not well covered by cash flows.


Discover strong dividend paying companies

Management

How experienced are the management team and are they aligned to shareholders interests?

4.6yrs

Average management tenure


CEO

Jennifer Sherman (57 yo)

6.58yrs

Tenure

US$4,672,213

Compensation

Ms. Jennifer L. Sherman has been the Chief Executive Officer, President and Director of Federal Signal Corporation since January 1, 2016. Ms. Sherman served as the Chief Operating Officer of Federal Signal...


CEO Compensation Analysis

Compensation vs Market: Jennifer's total compensation ($USD4.67M) is about average for companies of similar size in the US market ($USD6.61M).

Compensation vs Earnings: Jennifer's compensation has been consistent with company performance over the past year.


Leadership Team

Experienced Management: FSS's management team is considered experienced (4.6 years average tenure).


Board Members

Experienced Board: FSS's board of directors are considered experienced (8.5 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Federal Signal Corporation's employee growth, exchange listings and data sources


Key Information

  • Name: Federal Signal Corporation
  • Ticker: FSS
  • Exchange: NYSE
  • Founded: 1901
  • Industry: Construction Machinery and Heavy Trucks
  • Sector: Capital Goods
  • Implied Market Cap: US$2.573b
  • Shares outstanding: 60.63m
  • Website: https://www.federalsignal.com

Number of Employees


Location

  • Federal Signal Corporation
  • 1415 West 22nd Street
  • Suite 1100
  • Oak Brook
  • Illinois
  • 60523
  • United States

Listings


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2022/08/19 00:00
End of Day Share Price2022/08/19 00:00
Earnings2022/06/30
Annual Earnings2021/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.