NYSE:SCX

Stock Analysis Report

Executive Summary

The L.S. Starrett Company, together with its subsidiaries, manufactures and sells industrial, professional, and consumer measuring and cutting tools, and related products primarily in North America, Brazil, China, the United Kingdom, Australia, and New Zealand.

Rewards

PE ratio (6.5x) is below the US market (18.4x)

Earnings grew by 12.8% over the past year

Risk Analysis

Does not have a meaningful market cap ($37M)



Snowflake Analysis

Solid track record with adequate balance sheet.


Similar Companies

Share Price & News

How has L.S. Starrett's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: SCX has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

2.3%

SCX

1.0%

US Machinery

0.9%

US Market


1 Year Return

-34.5%

SCX

11.5%

US Machinery

20.0%

US Market

Return vs Industry: SCX underperformed the US Machinery industry which returned 11.4% over the past year.

Return vs Market: SCX underperformed the US Market which returned 20.1% over the past year.


Shareholder returns

SCXIndustryMarket
7 Day2.3%1.0%0.9%
30 Day-11.5%-2.1%1.4%
90 Day-12.1%2.4%8.8%
1 Year-34.5%-34.5%13.6%11.5%22.5%20.0%
3 Year-50.3%-52.5%37.0%28.3%49.9%40.3%
5 Year-73.0%-75.9%63.5%44.3%73.2%54.1%

Price Volatility Vs. Market

How volatile is L.S. Starrett's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is L.S. Starrett undervalued compared to its fair value and its price relative to the market?

6.47x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: Insufficient data to calculate SCX's fair value to establish if it is undervalued.

Significantly Below Fair Value: Insufficient data to calculate SCX's fair value to establish if it is undervalued.


Price To Earnings Ratio

PE vs Industry: SCX is good value based on its PE Ratio (6.5x) compared to the Machinery industry average (21.4x).

PE vs Market: SCX is good value based on its PE Ratio (6.5x) compared to the US market (18.4x).


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate SCX's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: SCX is good value based on its PB Ratio (0.4x) compared to the US Machinery industry average (2.2x).


Next Steps

Future Growth

How is L.S. Starrett forecast to perform in the next 1 to 3 years based on estimates from 0 analysts?

9.6%

Forecasted Capital Goods industry annual growth in earnings


In this section we usually present revenue and earnings growth projections based on the consensus estimates of professional analysts to help investors understand the company’s ability to generate profit. But as L.S. Starrett has not provided enough past data and has no analyst forecast, its future earnings cannot be reliably calculated by extrapolating past data or using analyst predictions.

This is quite a rare situation as 97% of companies covered by SimplyWall St do have past financial data.


Next Steps

Past Performance

How has L.S. Starrett performed over the past 5 years?

4.9%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: SCX has high quality earnings.

Growing Profit Margin: SCX's current net profit margins (2.5%) are higher than last year (2.3%).


Past Earnings Growth Analysis

Earnings Trend: SCX's earnings have grown by 4.9% per year over the past 5 years.

Accelerating Growth: SCX's earnings growth over the past year (12.8%) exceeds its 5-year average (4.9% per year).

Earnings vs Industry: SCX earnings growth over the past year (12.8%) exceeded the Machinery industry 0.9%.


Return on Equity

High ROE: SCX's Return on Equity (6.6%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is L.S. Starrett's financial position?


Financial Position Analysis

Short Term Liabilities: SCX's short term assets ($114.9M) exceed its short term liabilities ($30.6M).

Long Term Liabilities: SCX's short term assets ($114.9M) exceed its long term liabilities ($76.2M).


Debt to Equity History and Analysis

Debt Level: SCX's debt to equity ratio (26.9%) is considered satisfactory.

Reducing Debt: SCX's debt to equity ratio has increased from 16.8% to 26.9% over the past 5 years.

Debt Coverage: SCX's debt is not well covered by operating cash flow (14.6%).

Interest Coverage: SCX's interest payments on its debt are well covered by EBIT (11.5x coverage).


Balance Sheet

Inventory Level: SCX has a high level of physical assets or inventory.

Debt Coverage by Assets: SCX's debt is covered by short term assets (assets are 5x debt).


Next Steps

Dividend

What is L.S. Starrett's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

company0%marketbottom25%1.4%markettop25%3.7%industryaverage1.9%forecastin3Yearsn/a

Current dividend yield vs market & industry

Notable Dividend: Unable to evaluate SCX's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate SCX's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if SCX's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if SCX's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: SCX is not paying a notable dividend for the US market.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of SCX's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

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

0.4yrs

Average management tenure


CEO

Douglas Starrett (67yo)

18.4yrs

Tenure

US$1,450,786

Compensation

Mr. Douglas A. Starrett has been the Chief Executive Officer at The L.S. Starrett Company since September 9, 2001 and has been its President since 1995. Mr. Starrett served as Chairman of The L.S. Starret ...


CEO Compensation Analysis

Compensation vs Market: Douglas's total compensation ($USD1.45M) is above average for companies of similar size in the US market ($USD521.92K).

Compensation vs Earnings: Douglas's compensation has increased by more than 20% in the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Douglas Starrett
President18.4yrsUS$1.45m1.96% $723.0k
John Tripp
Chief Financial Officer0.3yrsno datano data
John Kober
CFO & Principal Accounting Officer0.4yrsno datano data

0.4yrs

Average Tenure

57yo

Average Age

Experienced Management: SCX's management team is not considered experienced ( 0.4 years average tenure), which suggests a new team.


Board Members

NamePositionTenureCompensationOwnership
Douglas Starrett
President18.4yrsUS$1.45m1.96% $723.0k
Thomas Riordan
Independent Director2.1yrsUS$59.19k0.12% $44.2k
Richard Kennedy
Independent Director24.1yrsUS$62.19k0.059% $21.7k
Christopher Gahagan
Independent Director2.1yrsUS$59.19k0.041% $15.0k
Terry Piper
Independent Director16.2yrsUS$61.19k0.10% $36.8k
David Lemoine
Independent Director9.4yrsUS$64.19k0.11% $39.4k
Russell Carreker
Director2.1yrsUS$59.19k0.18% $66.5k

9.4yrs

Average Tenure

67yo

Average Age

Experienced Board: SCX's board of directors are considered experienced (9.4 years average tenure).


Ownership

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


Insider Trading Volume

Insider Buying: SCX 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

The L.S. Starrett Company's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: The L.S. Starrett Company
  • Ticker: SCX
  • Exchange: NYSE
  • Founded: 1880
  • Industry: Industrial Machinery
  • Sector: Capital Goods
  • Market Cap: US$36.906m
  • Shares outstanding: 6.96m
  • Website: https://www.starrett.com

Number of Employees


Location

  • The L.S. Starrett Company
  • 121 Crescent Street
  • Athol
  • Massachusetts
  • 1331
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
SCXNYSE (New York Stock Exchange)YesClass A Common StockUSUSDJan 1968
SCXL.BOTCPK (Pink Sheets LLC)Class B Common StockUSUSDJun 2003

Biography

The L.S. Starrett Company, together with its subsidiaries, manufactures and sells industrial, professional, and consumer measuring and cutting tools, and related products primarily in North America, Brazil, China, the United Kingdom, Australia, and New Zealand. The company’s products include precision tools, electronic gages, gage blocks, optical vision and laser measuring equipment, custom engineered granite solutions, squares, band saw blades, hole saws, hacksaw blades, jig saw blades, and reciprocating saw blades, as well as M1 lubricant and precision ground flat stock products. It also provides measuring tools, such as micrometers, vernier calipers, height gages, depth gages, dial indicators, steel rules, and combination squares, as well as custom, non-contact, and in-process gaging products; and force measurement and material test equipment. In addition, the company offers material test systems comprising hardware and software; manual and automated field of view measurement systems; and hand tools for measuring, marking, and layout that include tapes, levels, chalk lines, and other products for building trades, and construction and retail trades. Further, it provides carbide tipped products for cutting ferrous materials, and non-ferrous metals and castings. The company primarily distributes its precision hand tools, and saw and construction products through distributors or resellers. It serves the metalworking, aerospace, medical, and automotive markets; marine and farm equipment shops, and do-it-yourselfers; and tradesmen, which comprise builders, carpenters, plumbers, and electricians. The L.S. Starrett Company was founded in 1880 and is headquartered in Athol, Massachusetts. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/17 23:46
End of Day Share Price2020/02/14 00:00
Earnings2019/12/31
Annual Earnings2019/06/30


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.