A Business at a Glance
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MSC INDUSTRIAL DIRECT CO INC
MSM
$7.0B
Mkt Cap
$125.64
-0.15%
MSC INDUSTRIAL DIRECT CO INC (MSM) has a current P/E ratio of 34.2, compared to its historical median P/E of 12.2. The stock is currently considered Expensive based on its historical valuation range.
MSC INDUSTRIAL DIRECT CO INC (MSM) has a 5-year average return on invested capital (ROIC) of 15.6%. This indicates strong capital allocation and a potential competitive advantage.
MSC INDUSTRIAL DIRECT CO INC (MSM) has a market capitalization of $7.2B. It is classified as a mid-cap stock.
Yes, MSC INDUSTRIAL DIRECT CO INC (MSM) pays a dividend with a trailing twelve-month yield of 2.67%. The company also returns capital through share buybacks, with a buyback yield of 0.31%.
Based on historical P/E analysis, MSC INDUSTRIAL DIRECT CO INC (MSM) appears expensive. The current P/E of 34.2 is 181% above its historical median of 12.2. The estimated fair value CAGR (P/E method) is 5.3%.
MSC INDUSTRIAL DIRECT CO INC (MSM) operates in the Wholesale-Industrial Machinery & Equipment industry, within the Consumer Cyclical sector.
MSC is a leading North American distributor of metalworking and maintenance, repair and operations (MRO) products and services, serving customers ranging from individual machine shops to Fortune 1000 manufacturers and government agencies across the United States, Canada, Mexico, and the United Kingdom. The company operates a sophisticated distribution network comprising five customer fulfillment centers, nine regional inventory centers, 38 warehouses, and five manufacturing locations, offering approximately 2.5 million active stock-keeping units (SKUs) through e-commerce channels, catalogs, customer care centers, and direct sales. MSC's business model emphasizes value-added solutions and supply chain optimization rather than transactional distribution, leveraging inventory management expertise, technical support, and data-driven insights to help customers reduce operational costs and improve productivity. The company differentiates itself through next-day delivery capabilities nationwide in the United States, sophisticated e-commerce platforms with real-time inventory visibility and customer-specific pricing, inventory management solutions including in-plant and vending services, and proprietary tools such as Application Optimization and MSC MillMax that deliver tailored productivity improvements. Revenue is generated through product sales across metalworking, MRO, Class C Consumables, and original equipment manufacturer (OEM) categories, with customers benefiting from consolidated purchasing, single invoicing, and direct shipments to multiple facilities. MSC's competitive moat is built on its extensive product inventory, technical expertise in metalworking applications, robust supplier relationships, and integrated digital capabilities that enable customers to streamline procurement and reduce administrative costs.
【Volume recovery accelerating】 Management expects volume growth to accelerate through the remainder of fiscal 2026 and into fiscal 2027, with daily sales trends showing improvement from April through June and expectations for continued momentum as the company's sales optimization initiatives take hold. The company is pursuing aggressive cost structure optimization to restore operating margins to the mid-teens, targeting approximately 1,000 excess heads relative to competitive benchmarks and leveraging artificial intelligence and automation to improve productivity without proportional headcount additions. Management anticipates that gross margins will remain stable through the cycle as pricing actions offset supplier cost inflation, while incremental operating margins are expected to remain in the mid-20s range as sales growth outpaces expense growth. The company is prioritizing organic investment to fuel growth and advance operational efficiencies, with capital expenditure expectations moderated and free cash flow conversion targeted at 95% for the fiscal year, reflecting disciplined capital allocation focused on high-return initiatives.
| Metric | Target | Period |
|---|---|---|
| Average daily sales growth | 6.5%-8.5% | FY2026 Q4 |
| Adjusted operating margin | 10%-10.8% | FY2026 Q4 |
| Depreciation and Amortization expense | approximately $100 million | FY2026 |
| Capital expenditures | approximately $100 million | FY2026 |
| Free cash flow conversion | 95% | FY2026 |
Average daily sales growth (FY2026 Q4): “we are anticipating average daily sales improvement of 6.5%-8.5% compared to the prior year”
Adjusted operating margin (FY2026 Q4): “the continuation of profitable growth demonstrated by the midpoint of our adjusted operating margin range of 10%-10.8%”
Depreciation and Amortization expense (FY2026): “We now expect Depreciation and Amortization expense to be approximately $100 million for the fiscal year versus our prior expectation of $90 million-$100 million.”
Capital expenditures (FY2026): “We are also reducing our CapEx assumption from $100 million-$110 million to approximately $100 million.”
Free cash flow conversion (FY2026): “This is resulting in our expectations for free cash flow conversion to increase from 90% to 95% for the fiscal year.”
Generated solely from the company's own reports listed below — not from third-party data. Hallucination risk is low. · Sources: 10-K, Q4 FY2026 Earnings Call, Q3 FY2026 Earnings Call, Q2 FY2026 Earnings Call, Q1 FY2026 Earnings Call
| Metric | TTM | FY2025 | FY2024 | FY2023 | FY2022 | FY2021 |
|---|---|---|---|---|---|---|
| Revenue | 3.8B | 3.8B | 3.8B | 4.0B | 3.7B | 3.2B |
| Net Income | 208M | 199M | 259M | 343M | 340M | 217M |
| EPS | $3.66 | $3.57 | $4.58 | $6.11 | $6.06 | $3.87 |
| Free Cash Flow | 215M | 241M | 311M | 607M | 185M | 171M |
| ROIC | 12.5% | 13.1% | 16.5% | 18.3% | 17.4% | 12.6% |
| Gross Margin | 40.8% | 40.8% | 41.2% | 41.0% | 42.2% | 41.1% |
| Debt/Equity | 0.37 | 0.35 | 0.37 | 0.31 | 0.64 | 0.72 |
| Dividends/Share | $3.36 | $3.40 | $3.32 | $3.15 | $2.99 | $2.98 |
| Operating Income | 308M | 302M | 390M | 484M | 469M | 302M |
| Operating Margin | 8.0% | 8.0% | 10.2% | 12.1% | 12.7% | 9.3% |
| ROE | 15.0% | 14.3% | 18.0% | 24.3% | 27.2% | 17.6% |
| Shares Outstanding | 57M | 56M | 56M | 56M | 56M | 56M |
| Metric | 2015 | 2016 | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Income Statement | |||||||||||||
| Revenue | 2.8B | 2.9B | 2.9B | 2.9B | 3.2B | 3.4B | 3.2B | 3.2B | 3.7B | 4.0B | 3.8B | 3.8B | 3.8B |
| Gross Margin | 46.1% | 45.2% | 45.0% | 44.5% | 43.5% | 42.6% | 42.1% | 41.1% | 42.2% | 41.0% | 41.2% | 40.8% | 40.8% |
| R&D | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A |
| SG&A | 903M | 937M | 118M | 120M | 130M | 138M | 126M | 134M | 155M | 157M | 149M | 151M | 151M |
| EBIT | 383M | 380M | 376M | 379M | 421M | 400M | 351M | 302M | 469M | 484M | 390M | 302M | 308M |
| Op. Margin | 13.7% | 13.0% | 13.1% | 13.1% | 13.1% | 11.9% | 11.0% | 9.3% | 12.7% | 12.1% | 10.2% | 8.0% | 8.0% |
| Net Income | 234M | 230M | 230M | 231M | 329M | 289M | 251M | 217M | 340M | 343M | 259M | 199M | 208M |
| Net Margin | 8.4% | 7.9% | 8.0% | 8.0% | 10.3% | 8.6% | 7.9% | 6.7% | 9.2% | 8.6% | 6.8% | 5.3% | 5.4% |
| Non-Recurring | 3.9M | -1.5M | -752K | -678K | -479K | 6.3M | 16M | 47M | 15M | 7.4M | 14M | 10M | 15M |
| Returns on Capital | |||||||||||||
| ROIC | 14.0% | 12.9% | 11.9% | 11.1% | 14.9% | 13.2% | 12.8% | 12.6% | 17.4% | 18.3% | 16.5% | 13.1% | 12.5% |
| ROE | 16.8% | 16.8% | 18.9% | 19.9% | 25.2% | 20.2% | 18.0% | 17.6% | 27.2% | 24.3% | 18.0% | 14.3% | 15.0% |
| ROA | 11.7% | 11.1% | 11.1% | 11.1% | 15.0% | 12.6% | 10.7% | 9.0% | 13.1% | 13.0% | 10.3% | 8.1% | 8.5% |
| Cash Flow | |||||||||||||
| Op. Cash Flow | 272M | 250M | 401M | 247M | 340M | 328M | 397M | 224M | 246M | 700M | 411M | 334M | 301M |
| Free Cash Flow | 202M | 198M | 313M | 200M | 295M | 277M | 350M | 171M | 185M | 607M | 311M | 241M | 215M |
| Owner Earnings | 191M | -105M | 9.6M | 170M | 262M | 247M | 311M | 138M | 157M | 606M | 311M | 231M | -441M |
| CapEx | 71M | 51M | 88M | 47M | 45M | 52M | 47M | 54M | 61M | 92M | 99M | 93M | 86M |
| Maint. CapEx | 65M | 340M | 377M | 63M | 63M | 65M | 69M | 69M | 70M | 75M | 81M | 91M | 728M |
| Growth CapEx | 5.7M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 17M | 19M | 2.2M | 0 |
| D&A | 65M | 340M | 377M | 63M | 63M | 65M | 69M | 69M | 70M | 75M | 81M | 91M | 728M |
| CapEx/OCF | 25.9% | 20.6% | 21.9% | 18.9% | 13.2% | 15.8% | 11.8% | 23.9% | 24.9% | 13.2% | 24.2% | 27.8% | 28.6% |
| Capital Allocation | |||||||||||||
| Dividends Paid | 83M | 99M | 106M | 102M | 125M | 146M | 167M | 167M | 167M | 177M | 187M | 190M | 192M |
| Dividend Yield | 2.7% | 3.4% | 4.0% | 3.2% | 3.8% | 4.8% | 5.9% | 4.4% | 4.3% | 4.1% | 3.9% | 4.3% | 2.7% |
| Share Buybacks | 191M | 33M | 384M | 49M | 82M | 85M | 3.4M | 71M | 27M | 96M | 188M | 39M | 22M |
| Buyback Yield | 5.7% | 1.3% | 13.2% | 2.0% | 2.5% | 3.3% | 0.1% | 1.8% | 0.7% | 1.9% | 4.3% | 0.8% | 0.3% |
| Stock-Based Comp | 17M | 14M | 14M | 14M | 15M | 16M | 17M | 18M | 19M | 19M | 19M | 13M | 15M |
| Debt Repayment | 78M | 243M | 301M | 619M | 350M | 451M | 916M | 2.6M | 2.5M | 2.2M | 3.6M | 1.5M | 1.5M |
| Balance Sheet | |||||||||||||
| Net Debt | 297M | 632M | 855M | 1.1B | 839M | 858M | 490M | 793M | 816M | 404M | 479M | 429M | 466M |
| Cash & Equiv. | 47M | 38M | 53M | 16M | 46M | 32M | 125M | 41M | 44M | 50M | 30M | 56M | 46M |
| Long-Term Debt | 240M | 214M | 340M | 201M | 311M | 264M | 495M | 582M | 469M | 224M | 278M | 169M | 195M |
| Debt/Equity | 0.25 | 0.50 | 0.83 | 0.94 | 0.64 | 0.60 | 0.47 | 0.72 | 0.64 | 0.31 | 0.37 | 0.35 | 0.37 |
| Interest Coverage | 98.9 | 59.9 | 64.7 | 30.6 | 29.1 | 23.7 | 21.0 | 20.8 | 26.6 | 21.5 | 15.1 | 12.5 | 12.5 |
| Equity | 1.4B | 1.3B | 1.1B | 1.2B | 1.4B | 1.5B | 1.3B | 1.2B | 1.4B | 1.5B | 1.4B | 1.4B | 1.4B |
| Total Assets | 2.1B | 2.1B | 2.1B | 2.1B | 2.3B | 2.3B | 2.4B | 2.5B | 2.7B | 2.5B | 2.5B | 2.5B | 2.5B |
| Total Liabilities | 662M | 767M | 967M | 874M | 901M | 827M | 1.1B | 1.3B | 1.4B | 1.1B | 1.1B | 1.1B | 1.1B |
| Intangibles | 138M | 120M | 105M | 110M | 123M | 117M | 105M | 102M | 114M | 111M | 101M | 85M | 78M |
| Retained Earnings | 1.3B | 1.2B | 1.0B | 1.2B | 1.3B | 947M | 750M | 532M | 681M | 755M | 457M | 433M | 420M |
| Working Capital | 652M | 610M | 503M | 448M | 657M | 753M | 829M | 752M | 818M | 668M | 583M | 497M | 521M |
| Current Assets | 961M | 1.0B | 981M | 1.0B | 1.1B | 1.2B | 1.2B | 1.3B | 1.5B | 1.3B | 1.2B | 1.2B | 1.2B |
| Current Liabilities | 309M | 422M | 479M | 558M | 491M | 447M | 409M | 562M | 726M | 649M | 605M | 729M | 709M |
| Per Share Data | |||||||||||||
| EPS | 3.76 | 3.74 | 3.77 | 4.05 | 5.80 | 5.20 | 4.51 | 3.87 | 6.06 | 6.11 | 4.58 | 3.57 | 3.66 |
| Owner EPS | 3.06 | -1.70 | 0.16 | 2.98 | 4.61 | 4.44 | 5.58 | 2.46 | 2.79 | 10.78 | 5.51 | 4.13 | -7.72 |
| Book Value | 22.43 | 21.68 | 17.98 | 21.50 | 24.47 | 26.63 | 23.62 | 20.53 | 24.08 | 26.33 | 24.65 | 24.86 | 24.20 |
| Cash Flow/Share | 4.37 | 4.06 | 6.57 | 4.33 | 5.99 | 5.91 | 7.13 | 4.00 | 4.39 | 12.45 | 7.27 | 5.98 | 16.37 |
| Dividends/Share | 1.32 | 4.60 | 1.72 | 1.80 | 2.22 | 2.62 | 2.99 | 2.98 | 2.99 | 3.15 | 3.32 | 3.40 | 3.36 |
| Shares Out. | 62.4M | 61.5M | 61.1M | 57.0M | 56.7M | 55.5M | 55.7M | 56.0M | 56.1M | 56.2M | 56.5M | 55.8M | 57.2M |
| Valuation | |||||||||||||
| P/E Ratio | 14.1 | 11.3 | 12.6 | 10.9 | 10.0 | 8.9 | 11.5 | 18.6 | 11.8 | 15.1 | 16.7 | 25.0 | 34.3 |
| P/FCF | 16.4 | 13.1 | 9.2 | 12.5 | 11.2 | 9.3 | 8.3 | 23.6 | 21.7 | 8.5 | 13.9 | 20.7 | 33.4 |
| EV/EBIT | 9.4 | 7.7 | 9.8 | 8.8 | 9.4 | 7.8 | 9.6 | 16.3 | 10.8 | 11.9 | 12.8 | 18.8 | 24.8 |
| Price/Book | 2.4 | 2.0 | 2.6 | 2.1 | 2.4 | 1.7 | 2.2 | 3.5 | 3.0 | 3.5 | 3.1 | 3.6 | 5.2 |
| Price/Sales | 1.1 | 1.0 | 0.9 | 1.1 | 1.0 | 0.9 | 0.9 | 1.2 | 1.1 | 1.1 | 1.3 | 1.2 | 1.9 |
| FCF Yield | 6.0% | 7.6% | 10.8% | 8.0% | 8.9% | 10.8% | 12.1% | 4.2% | 4.6% | 11.7% | 7.2% | 4.8% | 3.0% |
| Market Cap | 3.3B | 2.6B | 2.9B | 2.5B | 3.3B | 2.6B | 2.9B | 4.0B | 4.0B | 5.2B | 4.3B | 5.0B | 7.2B |
| Avg. Price | 49.94 | 46.67 | 43.16 | 55.91 | 57.50 | 54.43 | 50.48 | 68.23 | 70.04 | 77.31 | 85.86 | 78.59 | 125.64 |
| Year-End Price | 53.13 | 42.28 | 47.39 | 44.07 | 58.05 | 46.21 | 51.94 | 71.83 | 71.52 | 92.15 | 76.52 | 89.15 | 125.64 |
MSC INDUSTRIAL DIRECT CO INC passes 4 of 9 quality checks, suggesting mixed fundamentals.
MSC INDUSTRIAL DIRECT CO INC trades at 34.2x trailing earnings, compared to its 15-year median P/E of 12.2x, suggesting it is currently Expensive relative to its historical range. On a free-cash-flow basis, the stock trades at 42.1x vs a median of 11.9x. The company's 5-year average ROIC is 15.6% with a gross margin of 41.2%. Total shareholder yield (dividends + buybacks) is 3.0%. At current prices, the estimated annualized return to fair value is +1.7%.
MSC INDUSTRIAL DIRECT CO INC (MSM) reported annual revenue of $3.8 billion in its most recent fiscal year, based on SEC EDGAR filings.
MSC INDUSTRIAL DIRECT CO INC (MSM) has a net profit margin of 5.3%. This is a modest margin.
MSC INDUSTRIAL DIRECT CO INC (MSM) generated $241 million in free cash flow in its most recent fiscal year. Positive free cash flow supports dividends, buybacks, and debt reduction.
MSC INDUSTRIAL DIRECT CO INC (MSM) has a debt-to-equity ratio of 0.35. This indicates a conservatively financed balance sheet.
MSC INDUSTRIAL DIRECT CO INC (MSM) reported earnings per share (EPS) of $3.57 in its most recent fiscal year.
MSC INDUSTRIAL DIRECT CO INC (MSM) has a return on equity (ROE) of 14.3%. This indicates moderate shareholder returns.
MSC INDUSTRIAL DIRECT CO INC (MSM) has a 5-year average gross margin of 41.2%. This indicates decent pricing power.
The Ledger Terminal provides 17 years of financial data for MSC INDUSTRIAL DIRECT CO INC (MSM), sourced directly from SEC EDGAR filings. This includes income statements, balance sheets, cash flow statements, and key financial ratios.
MSC INDUSTRIAL DIRECT CO INC (MSM) has a book value per share of $24.86, based on its most recent annual SEC filing.
Based on recent SEC filings and earnings disclosures, Management expects volume growth to accelerate through the remainder of fiscal 2026 and into fiscal 2027, with daily sales trends showing improvement from April through June and expectations for continued momentum as the company's sales optimization initiatives take hold. The company is pursuing aggressive cost structure optimization to restore operating margins to the mid-teens, targeting approximately 1,000 excess heads relative to competitive benchmarks and leveraging artificial intelligence and automation to improve productivity without proportional headcount additions. Management anticipates that gross margins will remain stable through the cycle as pricing actions offset supplier cost inflation, while incremental operating margins are expected to remain in the mid-20s range as sales growth outpaces expense growth. The company is prioritizing organic investment to fuel growth and advance operational efficiencies, with capital expenditure expectations moderated and free cash flow conversion targeted at 95% for the fiscal year, reflecting disciplined capital allocation focused on high-return initiatives.
Based on recent SEC filings and earnings calls, MSC INDUSTRIAL DIRECT CO INC (MSM) has provided the following forward guidance: Average daily sales growth: 6.5%-8.5% (FY2026 Q4); Adjusted operating margin: 10%-10.8% (FY2026 Q4); Depreciation and Amortization expense: approximately $100 million (FY2026); Capital expenditures: approximately $100 million (FY2026); Free cash flow conversion: 95% (FY2026).