Definitive Analysis
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Definitive Analysis

Financial Statements

Ticker

Industry

Sector

Federal Signal Corporation (FSS)

Company Dividend Discount ModelIndustry: Industrial - Pollution & Treatment ControlsSector: Industrials

Valuation Snapshot

Stable Growth$90.98 - $245.43$139.84
Multi-Stage$61.24 - $66.95$64.04
Blended Fair Value$101.94
Current Price$118.99
Upside-14.33%
DecisionDon't Buy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2024202320222021202020192018201720162015
DPS8.71%18.00%0.480.390.350.360.310.310.300.270.270.25
YoY Growth--23.11%9.17%-0.91%13.40%0.52%3.21%11.31%-0.59%8.33%178.57%
Dividend Yield--0.65%0.45%0.65%1.06%0.82%1.15%1.15%1.24%1.99%1.91%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)235.80
(-) Cash Dividends Paid (M)32.90
(=) Cash Retained (M)202.90
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)47.1629.4817.69
Cash Retained (M)202.90202.90202.90
(-) Cash Required (M)-47.16-29.48-17.69
(=) Excess Retained (M)155.74173.43185.22
(/) Shares Outstanding (M)61.6061.6061.60
(=) Excess Retained per Share2.532.823.01
LTM Dividend per Share0.530.530.53
(+) Excess Retained per Share2.532.823.01
(=) Adjusted Dividend3.063.353.54
WACC / Discount Rate9.05%9.05%9.05%
Growth Rate5.50%6.50%7.50%
Fair Value$90.98$139.84$245.43
Upside / Downside-23.54%17.52%106.26%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)235.80251.13267.45284.83303.35323.07332.76
Payout Ratio13.95%29.16%44.37%59.58%74.79%90.00%92.50%
Projected Dividends (M)32.9073.23118.67169.71226.88290.76307.80

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate9.05%9.05%9.05%
Growth Rate5.50%6.50%7.50%
Year 1 PV (M)66.5267.1667.79
Year 2 PV (M)97.9399.79101.67
Year 3 PV (M)127.21130.86134.58
Year 4 PV (M)154.48160.42166.54
Year 5 PV (M)179.85188.53197.55
PV of Terminal Value (M)3,146.433,298.413,456.20
Equity Value (M)3,772.423,945.174,124.33
Shares Outstanding (M)61.6061.6061.60
Fair Value$61.24$64.04$66.95
Upside / Downside-48.53%-46.18%-43.73%

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