Montanaro Asset Management Ltd Acquires Shares of 18,400 Federal Signal Corporation (NYSE:FSS)

Key Points

• Montanaro Asset Management Ltd recently invested $1.35 million in Federal Signal Corporation by acquiring 18,400 shares in the first quarter of 2023.
• Federal Signal reported impressive quarterly earnings, with an EPS of $1.17 that surpassed estimates by $0.11 and a revenue of $564.60 million, reflecting a 15.1% year-over-year increase.
• The company has initiated a $150 million share repurchase plan, aiming to buy back up to 3.3% of its outstanding shares, indicating confidence in its stock valuation.

Montanaro Asset Management Ltd bought a new position in shares of Federal Signal Corporation (NYSE:FSS - Free Report) during the first quarter, according to its most recent disclosure with the Securities and Exchange Commission (SEC). The firm bought 18,400 shares of the conglomerate's stock, valued at approximately $1,353,000.

A number of other institutional investors have also modified their holdings of the stock. CoreCap Advisors LLC increased its position in shares of Federal Signal by 19.9% during the fourth quarter. CoreCap Advisors LLC now owns 875 shares of the conglomerate's stock worth $81,000 after acquiring an additional 145 shares during the period. Creative Financial Designs Inc. ADV boosted its stake in shares of Federal Signal by 16.9% during the first quarter. Creative Financial Designs Inc. ADV now owns 1,119 shares of the conglomerate's stock valued at $82,000 after purchasing an additional 162 shares in the last quarter. Bessemer Group Inc. boosted its stake in shares of Federal Signal by 78.4% during the first quarter. Bessemer Group Inc. now owns 421 shares of the conglomerate's stock valued at $31,000 after purchasing an additional 185 shares in the last quarter. Summit Investment Advisors Inc. boosted its stake in shares of Federal Signal by 3.3% during the fourth quarter. Summit Investment Advisors Inc. now owns 6,292 shares of the conglomerate's stock valued at $581,000 after purchasing an additional 200 shares in the last quarter. Finally, Xponance Inc. boosted its stake in shares of Federal Signal by 5.2% during the first quarter. Xponance Inc. now owns 4,540 shares of the conglomerate's stock valued at $334,000 after purchasing an additional 226 shares in the last quarter. 92.73% of the stock is owned by hedge funds and other institutional investors.

Analyst Upgrades and Downgrades

A number of research analysts have recently issued reports on the stock. Raymond James Financial lifted their price objective on shares of Federal Signal from $120.00 to $145.00 and gave the stock an "outperform" rating in a research report on Thursday, July 31st. Wall Street Zen raised shares of Federal Signal from a "hold" rating to a "buy" rating in a report on Saturday, August 2nd. CJS Securities reaffirmed a "market perform" rating and issued a $125.00 price target on shares of Federal Signal in a report on Thursday, July 31st. DA Davidson lifted their price target on shares of Federal Signal from $100.00 to $112.00 and gave the stock a "neutral" rating in a report on Thursday, July 31st. Finally, KeyCorp reaffirmed a "sector weight" rating on shares of Federal Signal in a report on Friday, July 11th. Three research analysts have rated the stock with a hold rating and two have given a buy rating to the company. According to MarketBeat.com, the stock presently has an average rating of "Hold" and an average price target of $123.00.

Federal Signal Stock Performance

Shares of NYSE:FSS traded down $3.41 on Friday, hitting $124.35. 591,275 shares of the company were exchanged, compared to its average volume of 591,435. Federal Signal Corporation has a 1-year low of $66.47 and a 1-year high of $130.30. The stock's 50 day moving average price is $111.32 and its 200 day moving average price is $94.42. The company has a current ratio of 2.60, a quick ratio of 1.25 and a debt-to-equity ratio of 0.20. The firm has a market capitalization of $7.56 billion, a P/E ratio of 34.64, a price-to-earnings-growth ratio of 2.31 and a beta of 1.30.

Federal Signal (NYSE:FSS - Get Free Report) last posted its quarterly earnings data on Wednesday, July 30th. The conglomerate reported $1.17 EPS for the quarter, topping the consensus estimate of $1.06 by $0.11. The business had revenue of $564.60 million during the quarter, compared to the consensus estimate of $537.24 million. Federal Signal had a net margin of 11.22% and a return on equity of 18.91%. The business's revenue for the quarter was up 15.1% compared to the same quarter last year. During the same period in the previous year, the firm posted $0.95 earnings per share. Sell-side analysts predict that Federal Signal Corporation will post 3.34 EPS for the current year.

Federal Signal Announces Dividend

The firm also recently announced a quarterly dividend, which will be paid on Thursday, August 28th. Investors of record on Friday, August 15th will be given a dividend of $0.14 per share. The ex-dividend date is Friday, August 15th. This represents a $0.56 dividend on an annualized basis and a yield of 0.5%. Federal Signal's payout ratio is currently 15.60%.

Federal Signal declared that its board has initiated a share repurchase plan on Tuesday, April 22nd that allows the company to buyback $150.00 million in shares. This buyback authorization allows the conglomerate to repurchase up to 3.3% of its stock through open market purchases. Stock buyback plans are typically a sign that the company's board of directors believes its stock is undervalued.

About Federal Signal

Federal Signal Corp. engages in the design and manufacture of products and integrated solutions for municipal, governmental, industrial, and commercial customers. It operates through the Environmental Solutions Group and Safety and Security Systems Group segments. The Environment Solutions Group segment is involved in the manufacture and supply of street sweeper vehicles, sewer cleaners, vacuum loader trucks, hydro-excavation trucks, and water blasting equipment.