NYSE:MSM

Stock Analysis Report

Executive Summary

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

Snowflake

Fundamentals

6 star dividend payer with excellent balance sheet.


Similar Companies

Share Price & News

How has MSC Industrial Direct's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

4.0%

NYSE:MSM

-1.1%

US Trade Distributors

-0.7%

US Market


1 Year Return

-20.6%

NYSE:MSM

-16.8%

US Trade Distributors

-0.5%

US Market

MSM underperformed the Trade Distributors industry which returned -16.8% over the past year.

MSM underperformed the Market in United States of America which returned -0.5% over the past year.


Share holder returns

MSMIndustryMarket
7 Day4.0%-1.1%-0.7%
30 Day-2.0%-2.3%-3.0%
90 Day-7.8%-5.0%0.9%
1 Year-17.9%-20.6%-15.3%-16.8%1.7%-0.5%
3 Year2.5%-5.4%23.8%18.4%39.5%30.4%
5 Year-9.1%-22.9%9.9%2.2%54.1%37.0%

Price Volatility Vs. Market

How volatile is MSC Industrial Direct's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is MSC Industrial Direct undervalued based on future cash flows and its price relative to the stock market?

3%

Discount to future cash flow value


Intrinsic Value Based on Future Cash Flows

MSC Industrial Direct's share price is below the future cash flow value, but not at a moderate discount (< 20%).

MSC Industrial Direct's share price is below the future cash flow value, but not at a substantial discount (< 40%).


Price Based on Earnings

MSC Industrial Direct is good value based on earnings compared to the US Trade Distributors industry average.

MSC Industrial Direct is good value based on earnings compared to the United States of America market.


Price Based on Expected Growth

MSC Industrial Direct is poor value based on expected growth next year.


Price Based on Value of Assets

MSC Industrial Direct is overvalued based on assets compared to the US Trade Distributors industry average.


Next Steps

Future Growth

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

8.5%

Forecasted annual earnings growth


Earnings and Revenue Growth Estimates


Future Annual Growth Analysis

MSC Industrial Direct's revenue is expected to grow by 3.9% yearly, however this is not considered high growth (20% yearly).

MSC Industrial Direct's earnings are expected to grow by 8.5% yearly, however this is not considered high growth (20% yearly).

MSC Industrial Direct's revenue growth is positive but not above the United States of America market average.

MSC Industrial Direct's earnings growth is positive but not above the United States of America market average.

MSC Industrial Direct's earnings growth is expected to exceed the low risk savings rate of 2.7%.


Earnings per Share Growth Estimates


Future Return on Equity

Unable to establish if MSC Industrial Direct will efficiently use shareholders’ funds in the future without estimates of Return on Equity.


Next Steps

Past Performance

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

7.5%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

MSC Industrial Direct's year on year earnings growth rate has been positive over the past 5 years.

MSC Industrial Direct's 1-year earnings growth is negative, it can't be compared to the 5-year average.

MSC Industrial Direct's 1-year earnings growth is negative, it can't be compared to the US Trade Distributors industry average.


Return on Equity

MSC Industrial Direct has efficiently used shareholders’ funds last year (Return on Equity greater than 20%).


Return on Assets

MSC Industrial Direct used its assets more efficiently than the US Trade Distributors industry average last year based on Return on Assets.


Return on Capital Employed

MSC Industrial Direct has improved its use of capital last year versus 3 years ago (Return on Capital Employed).


Next Steps

Financial Health

How is MSC Industrial Direct's financial position?


Financial Position Analysis

MSC Industrial Direct is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.

MSC Industrial Direct's cash and other short term assets cover its long term commitments.


Debt to Equity History and Analysis

MSC Industrial Direct's level of debt (32.8%) compared to net worth is satisfactory (less than 40%).

The level of debt compared to net worth has increased over the past 5 years (19% vs 32.8% today).

Debt is well covered by operating cash flow (62.2%, greater than 20% of total debt).

Interest payments on debt are well covered by earnings (EBIT is 27.8x coverage).


Balance Sheet

High level of physical assets or inventory.

Debt is covered by short term assets, assets are 2.6x debt.


Next Steps

Dividend

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

4.28%

Expected Dividend Yield


Dividend Yield and Payments Analysis

MSC Industrial Direct's pays a higher dividend yield than the bottom 25% of dividend payers in United States of America (1.49%).

MSC Industrial Direct's dividend is above the markets top 25% of dividend payers in United States of America (3.84%).

Dividends per share have been stable in the past 10 years.

Dividends per share have increased over the past 10 years.


Current Payout to Shareholders

Dividends paid are well covered by earnings (2.2x coverage).


Future Payout to Shareholders

Dividends after 3 years are expected to be covered by earnings (1.6x coverage).


Next Steps

Management

What is the CEO of MSC Industrial Direct's salary, the management and board of directors tenure and is there insider trading?

5.8yrs

Average management tenure


CEO

Erik Gershwind (48yo)

6.6yrs

Tenure

US$4,461,519

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

Erik's remuneration is about average for companies of similar size in United States of America.

Erik's compensation has been consistent with company performance over the past year, both up more than 20%.


Management Age and Tenure

5.8yrs

Average Tenure

52.5yo

Average Age

The average tenure for the MSC Industrial Direct management team is over 5 years, this suggests they are a seasoned and experienced team.


Board Age and Tenure

10.6yrs

Average Tenure

66yo

Average Age

The average tenure for the MSC Industrial Direct board of directors is over 10 years, this suggests they are a seasoned and experienced board.


Insider Trading

No 3 month open market individual insider trading information.


Recent Insider Transactions

SellUS$177,52125 Apr 19
Douglas Jones
EntityIndividual
Role
Senior Key Executive
Executive VP & Chief Supply Chain Officer
Shares2,126
Max PriceUS$83.50
SellUS$223,00811 Feb 19
Gregory Polli
EntityIndividual
Shares2,699.94
Max PriceUS$82.60
SellUS$49,92230 Jan 19
Charles Bonomo
EntityIndividual
Role
Chief Information Officer
Senior VP & Chief Information Officer
Shares601.39
Max PriceUS$83.01
SellUS$436,57922 Jan 19
Steve Armstrong
EntityIndividual
Role
Chief Legal Officer
Senior VP
Shares5,293
Max PriceUS$82.48
SellUS$132,64122 Aug 18
Denis Kelly
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares1,500
Max PriceUS$88.43

Ownership Breakdown


Management Team

  • Rustom Jilla (58yo)

    Executive VP & CFO

    • Tenure: 4.1yrs
    • Compensation: US$1.67m
  • Erik Gershwind (48yo)

    President

    • Tenure: 6.6yrs
    • Compensation: US$4.46m
  • Doug Jones (55yo)

    Executive VP & Chief Supply Chain Officer

    • Tenure: 13.7yrs
    • Compensation: US$1.22m
  • Charles Bonomo (54yo)

    Senior VP & Chief Information Officer

    • Tenure: 12.1yrs
  • Steve Armstrong (61yo)

    Senior VP

    • Tenure: 10.8yrs
    • Compensation: US$1.13m
  • Kari Heerdt (51yo)

    Senior VP & Chief People Officer

    • Tenure: 5.0yrs
    • Compensation: US$913.59k
  • John Chironna

    VP of Investor Relations & Treasurer

    • Tenure: 6.8yrs
  • Paul Mason

    Director of Corporate Communications

    • Tenure: 4.6yrs
  • Steve Baruch (51yo)

    Executive VP and Chief Strategy & Marketing Officer

    • Tenure: 2.8yrs
    • Compensation: US$987.89k
  • Eddie Martin (49yo)

    Senior Vice President of Sales & Customer Success

    • Tenure: 0.2yrs

Board Members

  • Louise Goeser (66yo)

    Independent Director

    • Tenure: 10.6yrs
    • Compensation: US$213.46k
  • Mitchell Jacobson (68yo)

    Non-Executive Chairman

    • Tenure: 21.6yrs
    • Compensation: US$428.83k
  • Steven Paladino (62yo)

    Director

    • Tenure: 3.9yrs
    • Compensation: US$204.86k
  • Denis Kelly (70yo)

    Independent Director

    • Tenure: 23.3yrs
    • Compensation: US$221.06k
  • Roger Fradin (66yo)

    Independent Director

    • Tenure: 21.1yrs
    • Compensation: US$203.46k
  • Philip Peller (80yo)

    Lead Director

    • Tenure: 11.7yrs
    • Compensation: US$223.46k
  • Jonathan L. Byrnes (71yo)

    Independent Director

    • Tenure: 9.4yrs
    • Compensation: US$203.46k
  • Erik Gershwind (48yo)

    President

    • Tenure: 6.6yrs
    • Compensation: US$4.46m
  • Mike Kaufmann (56yo)

    Independent Director

    • Tenure: 3.9yrs
    • Compensation: US$208.56k

Company Information

MSC Industrial Direct Co., Inc.'s company bio, 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$3.860b
  • Shares outstanding: 55.20m
  • Website: https://www.mscdirect.com

Number of Employees


Location

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

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
MSMNYSE (New York Stock Exchange)YesClass A Common StockUSUSDDec 1995
98MDB (Deutsche Boerse AG)YesClass A Common StockDEEURDec 1995

Biography

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


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/08/19 23:40
End of Day Share Price2019/08/19 00:00
Earnings2019/06/01
Annual Earnings2018/09/01


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.