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Federal Signal Corporation (NYSE:FSS) – Analysts Reduce Federal Signal Price Target After Fourth Quarter Results

  • KeyBanc analyst Steve Barger lowered the price target to Federal Signal Corp (NYSE:FSS) to $48 (up 37.5%) from $55 and maintained an overweight rating on equities.
  • The analyst mentions that the shares fell following the company’s fourth quarter results and guidance for 2022. He believes the decline was driven by the EPS guide of $1.76 to $2.00 from at a consensus of $2.14.
  • Barger estimates that the guide implies an additional margin of around ten percent despite a fairly strong revenue outlook, driven by supply chain and workforce challenges in the first half of 2022.
  • While these dynamics aren’t unique to Federal Signal, the low conversion is disappointing relative to its record order backlog, Barger says.
  • Raymond James Analyst Felix Boeschen lowered the price target to $46 (up 32%) from $52 and maintained a strong buy rating on the stock.
  • Recentlythe company posted fourth-quarter sales growth of 2% year-over-year to $301.4 million, slightly missing the consensus of $301.67 million.
  • Adjusted EPS was $0.40, beating the consensus of $0.38.
  • Orders for the quarter were $444 million, up 61% year-on-year. Backlog was $629 million, up 107% year-on-year.
  • Adjusted EBITDA margin decreased to 13.3% for the quarter from 15.9% a year ago.
  • As of December 31, 2021, total debt was $283 million, total cash and cash equivalents were $41 million and the company had $209 million available for borrowing under its credit facility.
  • Outlook for FY22: The company forecasts net sales of $1.35-1.45 billion versus consensus of $1.39 billion and adjusted EPS of $1.76-2.00 versus consensus of $2.14 .
  • Price action: FSS shares are trading up 3.71% at $34.90 when last checked on Wednesday.

Latest reviews for FSS

Dated Solidify action From For
March 2022 Raymond James Maintains strong purchase
March 2022 Keybank Maintains Overweight
Jan 2022 Raymond James Maintains strong purchase

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