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MSC Industrial Direct Co Inc Class A MSM

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Stock XNYS Rating as of
$112.43 −20.39 (15.35%)
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MSC Industrial's Switching Costs Are Bolstered by Its In-Plant Vending Solutions

Nicholas Lieb

Since its 1995 initial public offering, MSC Industrial Direct has become one of the largest industrial distributors in the United States. It is especially well known in the metalworking industry, where we estimate it holds a low-double-digit market share. MSC is conservatively capitalized, but it isn’t afraid to flex its balance sheet when the right opportunity arises. The company spent $900 million to acquire J&L Industrial Supply in 2006 and Barnes’ North America distribution business in 2013, which bolstered its metalworking and inventory management products and services.

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Price vs Fair Value

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MSM is trading at a LOCK|x<$yZg premium.
Price
$113.18
Fair Value
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Uncertainty
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1-Star Price
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5-Star Price
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Economic Moat
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Capital Allocation
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Bulls Say, Bears Say

Bulls

MSC’s national scale and focus on inventory management services should help the firm take share from smaller regional and local distributors.

Bears

MSC could continue to face gross-margin pressure amid soft demand, fierce competition, and execution issues.

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Trading Information

Previous Close Price
$132.82
Day Range
$111.76–126.50
52-Week Range
$78.80–133.95
Bid/Ask
$113.05 / $117.29
Shares Outstanding
55.85M
Market Cap
$6.28B
Volume/Avg
2M / 717,975

Key Statistics

Price/Earnings (Normalized)
26.00
Price/Sales
1.57
Dividend Yield (Trailing)
2.62%
Dividend Yield (Forward)
2.68%
Dividend Payment Schedule
Jan, Apr, Jul, Nov
Total Yield
3.10%

Company Profile

Founded in 1941, MSC Industrial Direct originally manufactured and sold cutting tools to metalworking shops in New York. Through a series of acquisitions and organic expansions, MSC has grown into an industrial distribution powerhouse with a focus on specialized metalworking products and services. The firm also distributes a wide breadth of maintenance, repair, and operations supplies. MSC primarily operates in North America, where it derives over 95% of its revenue.
Sector
Industrials
Industry
Industrial Distribution
Stock Style Box
Small Core
Total Number of Employees
7,284
Website
https://www.mscdirect.com

Competitors

Valuation

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Metric
MSM
GWW
WCC
Price/Earnings (Normalized)
 26.0031.4021.21
Price/Book Value
 4.4015.513.02
Price/Sales
 1.573.430.64
Price/Cash Flow
 14.8724.3914.90
Price/Earnings
MSM
GWW
WCC

Financial Strength

Metric
MSM
GWW
WCC
Quick Ratio
 0.591.601.16
Current Ratio
 1.552.812.09
Interest Coverage
 14.7134.153.25
Quick Ratio
MSM
GWW
WCC

Profitability

Metric
MSM
GWW
WCC
Return on Assets (Normalized)
 9.78%22.16%4.49%
Return on Equity (Normalized)
 17.44%53.36%15.11%
Return on Invested Capital (Normalized)
 13.21%29.93%9.30%
Return on Assets
MSM
GWW
WCC

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