MSM

MSC Industrial DirectNYSE:MSM Stock Report

Market Cap

US$4.4b

7D

-2.2%

1Y

22.5%

Updated

16 Sep, 2021

Data

Company Financials +
MSM fundamental analysis
Snowflake Score
Valuation2/6
Future Growth2/6
Past Performance0/6
Financial Health4/6
Dividends6/6

MSM Overview

MSC Industrial Direct Co., Inc., together with its subsidiaries, distributes metalworking and maintenance, repair, and operations (MRO) products in the United States, Canada, Mexico, and the United Kingdom.

MSC Industrial Direct Competitors

Price History & Performance

Summary of all time highs, changes and price drops for MSC Industrial Direct
Historical stock prices
Current Share PriceUS$79.49
52 Week HighUS$60.09
52 Week LowUS$96.23
Beta1.01
1 Month Change-6.52%
3 Month Change-9.03%
1 Year Change22.50%
3 Year Change-9.87%
5 Year Change8.97%
Change since IPO555.59%

Recent News & Updates

Aug 22
Is Now The Time To Look At Buying MSC Industrial Direct Co., Inc. (NYSE:MSM)?

Is Now The Time To Look At Buying MSC Industrial Direct Co., Inc. (NYSE:MSM)?

While MSC Industrial Direct Co., Inc. ( NYSE:MSM ) might not be the most widely known stock at the moment, it received...

Jul 27
MSC Industrial Direct (NYSE:MSM) Has More To Do To Multiply In Value Going Forward

MSC Industrial Direct (NYSE:MSM) Has More To Do To Multiply In Value Going Forward

If you're looking for a multi-bagger, there's a few things to keep an eye out for. One common approach is to try and...

Jul 16

MSC Industrial: 3.4% Yield, High Capital Efficiency, Strong Profits

MSM has the highest dividend yield among the industrial companies presented in the S&P 400, 3.4%. The company has a robust capital efficiency coupled with high-quality earnings that support dividend coverage. Its Forward Enterprise Value/EBIT of 15.4x is 13% lower than the sector median. Overall, the stock has a B- Value Grade. I am not expecting MSM to rally during months to come given the changing market narrative amid the sputtering value rotation and growth stocks regaining investor attention, but the share price softness might be used as an opportunity to accumulate for higher yield.

Jul 14
There May Be Reason For Hope In MSC Industrial Direct's (NYSE:MSM) Disappointing Earnings

There May Be Reason For Hope In MSC Industrial Direct's (NYSE:MSM) Disappointing Earnings

Shareholders appeared unconcerned with MSC Industrial Direct Co., Inc.'s ( NYSE:MSM ) lackluster earnings report last...

Shareholder Returns

MSMUS Trade DistributorsUS Market
7D-2.2%-0.5%-0.6%
1Y22.5%46.0%33.6%

Return vs Industry: MSM underperformed the US Trade Distributors industry which returned 46.2% over the past year.

Return vs Market: MSM underperformed the US Market which returned 33.7% over the past year.

Price Volatility

Is MSM's price volatile compared to industry and market?
MSM volatility
MSM Beta1.01
Industry Beta1.57
Market Beta1

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

Volatility Over Time: MSM's weekly volatility (3%) has been stable over the past year.

About the Company

FoundedEmployeesCEOWebsite
19416,315Erik Gershwindhttps://www.mscdirect.com

MSC Industrial Direct Co., Inc., together with its subsidiaries, distributes metalworking and maintenance, repair, and operations (MRO) products in the United States, Canada, Mexico, and the United Kingdom. Its MRO products include cutting tools, measuring instruments, tooling components, metalworking products, fasteners, flat stock products, raw materials, abrasives, machinery hand and power tools, safety and janitorial supplies, plumbing supplies, materials handling products, power transmission components, and electrical supplies. The company offers approximately 1.9 million stock-keeping units through its catalogs and brochures; e-commerce channels, including its Website, mscdirect.com; inventory management solutions; and call-centers and branches.

MSC Industrial Direct Fundamentals Summary

How do MSC Industrial Direct's earnings and revenue compare to its market cap?
MSM fundamental statistics
Market CapUS$4.42b
Earnings (TTM)US$203.47m
Revenue (TTM)US$3.16b

21.7x

P/E Ratio

1.4x

P/S Ratio

Earnings & Revenue

Key profitability statistics from the latest earnings report
MSM income statement (TTM)
RevenueUS$3.16b
Cost of RevenueUS$1.83b
Gross ProfitUS$1.33b
ExpensesUS$1.12b
EarningsUS$203.47m

Last Reported Earnings

May 29, 2021

Next Earnings Date

Oct 20, 2021

Earnings per share (EPS)3.65
Gross Margin41.95%
Net Profit Margin6.44%
Debt/Equity Ratio65.7%

How did MSM perform over the long term?

See historical performance and comparison

Dividends

3.8%

Current Dividend Yield

82%

Payout Ratio

Valuation

Is MSC Industrial Direct undervalued compared to its fair value and its price relative to the market?

9.9%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: MSM ($79.49) is trading below our estimate of fair value ($88.19)

Significantly Below Fair Value: MSM is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: MSM is good value based on its PE Ratio (21.7x) compared to the US Trade Distributors industry average (22.3x).

PE vs Market: MSM is poor value based on its PE Ratio (21.7x) compared to the US market (17.8x).


Price to Earnings Growth Ratio

PEG Ratio: MSM is poor value based on its PEG Ratio (1.5x)


Price to Book Ratio

PB vs Industry: MSM is overvalued based on its PB Ratio (3.9x) compared to the US Trade Distributors industry average (2.3x).


Future Growth

How is MSC Industrial Direct forecast to perform in the next 1 to 3 years based on estimates from 13 analysts?

14.8%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: MSM's forecast earnings growth (14.8% per year) is above the savings rate (2%).

Earnings vs Market: MSM's earnings (14.8% per year) are forecast to grow slower than the US market (14.9% per year).

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

Revenue vs Market: MSM's revenue (5.7% per year) is forecast to grow slower than the US market (9.7% per year).

High Growth Revenue: MSM's revenue (5.7% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: MSM's Return on Equity is forecast to be high in 3 years time (27.2%)


Past Performance

How has MSC Industrial Direct performed over the past 5 years?

-0.2%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: MSM has a large one-off loss of $74.1M impacting its May 29 2021 financial results.

Growing Profit Margin: MSM's current net profit margins (6.4%) are lower than last year (8.1%).


Past Earnings Growth Analysis

Earnings Trend: MSM's earnings have declined by 0.2% per year over the past 5 years.

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

Earnings vs Industry: MSM had negative earnings growth (-23.3%) over the past year, making it difficult to compare to the Trade Distributors industry average (73.5%).


Return on Equity

High ROE: MSM's Return on Equity (17.8%) is considered low.


Financial Health

How is MSC Industrial Direct's financial position?


Financial Position Analysis

Short Term Liabilities: MSM's short term assets ($1.3B) exceed its short term liabilities ($768.8M).

Long Term Liabilities: MSM's short term assets ($1.3B) exceed its long term liabilities ($503.6M).


Debt to Equity History and Analysis

Debt Level: MSM's debt to equity ratio (65.7%) is considered high.

Reducing Debt: MSM's debt to equity ratio has increased from 17% to 65.7% over the past 5 years.

Debt Coverage: MSM's debt is well covered by operating cash flow (42.5%).

Interest Coverage: MSM's interest payments on its debt are well covered by EBIT (23.8x coverage).


Balance Sheet


Dividend

What is MSC Industrial Direct current dividend yield, its reliability and sustainability?

3.77%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: MSM's dividend (3.77%) is higher than the bottom 25% of dividend payers in the US market (1.34%).

High Dividend: MSM's dividend (3.77%) is in the top 25% of dividend payers in the US market (3.58%)


Stability and Growth of Payments

Stable Dividend: MSM's dividends per share have been stable in the past 10 years.

Growing Dividend: MSM's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: At its current payout ratio (82.2%), MSM's payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: MSM's dividends in 3 years are forecast to be covered by earnings (57.4% payout ratio).


Next Steps

Management

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

6.7yrs

Average management tenure


CEO

Erik Gershwind (50 yo)

8.67yrs

Tenure

US$4,344,435

Compensation

Mr. Erik David Gershwind has been the Chief Executive Officer of MSC Industrial Direct Co. Inc. since January 1, 2013. Mr. Gershwind has also been the President of MSC Industrial Direct Co. Inc. since Octo...


CEO Compensation Analysis

Compensation vs Market: Erik's total compensation ($USD4.34M) is about average for companies of similar size in the US market ($USD5.25M).

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


Leadership Team

Experienced Management: MSM's management team is seasoned and experienced (6.7 years average tenure).


Board Members

Experienced Board: MSM's board of directors are seasoned and experienced ( 11.5 years average tenure).


Ownership

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


Insider Trading Volume

Insider Buying: MSM insiders have only sold shares 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

MSC Industrial Direct Co., Inc.'s employee growth, exchange listings and data sources


Key Information

  • Name: MSC Industrial Direct Co., Inc.
  • Ticker: MSM
  • Exchange: NYSE
  • Founded: 1941
  • Industry: Trading Companies and Distributors
  • Sector: Capital Goods
  • Market Cap: US$4.423b
  • Shares outstanding: 55.65m
  • Website: https://www.mscdirect.com

Number of Employees


Location

  • MSC Industrial Direct Co., Inc.
  • 75 Maxess Road
  • Melville
  • New York
  • 11747
  • United States

Listings


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/09/16 22:48
End of Day Share Price2021/09/16 00:00
Earnings2021/05/29
Annual Earnings2020/08/29


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.