MSC Industrial (MSM) AI Stock Analysis

• Market Cap: $4.82B
• Dividend Yield: 3.97%
• Average Volume (3M): 628.23K
• Price to Earnings (P/E): 24.2
• Beta (1Y): 0.91
• Revenue Growth: -1.35%
• EPS Growth: -22.24%
• Country: US
• Employees: 7,191
• Sector: Industrials
• Sector Strength: 72
• Industry: Industrial - Distribution
• EPS (TTM): 1.09
• Shares Outstanding: 55,790,154
• 10 Day Avg. Volume: 835,254
• 30 Day Avg. Volume: 628,233
• PEG Ratio: -1.13
• Price to Book (P/B): 3.63
• Price to Sales (P/S): 1.34
• P/FCF Ratio: 15.08
• Enterprise Value/Market Cap: 1.15
• Enterprise Value/Revenue: 1.47
• Enterprise Value/Gross Profit: 3.60
• Enterprise Value/Ebitda: 14.65
• 1Y Price Target: $97.00
• Price Target Upside: 13.33% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 5
• EPS Forecast (FY): 4.26
• Revenue Forecast (FY): $3.96B

• Rating: 64 Neutral
• Price Target: $94.00 ▲(9.83% Upside)

MSC Industrial's overall stock score reflects a stable financial performance with challenges in profitability and growth. The earnings call provided a positive outlook with strategic initiatives, but technical indicators suggest bearish momentum. The valuation is moderate, with a strong dividend yield offering some investor appeal.

Positive Factors

Strong Cash Flow

Strong free cash flow conversion indicates robust cash generation, providing financial flexibility for investments and shareholder returns.

Leadership Transition

The leadership transition to Martina McIsaac ensures continuity and strategic focus, potentially enhancing long-term strategic execution and stability.

High-Touch Solutions Expansion

Expansion in high-touch solutions like vending and implant programs supports sustained sales growth and strengthens customer relationships.

Negative Factors

Declining Revenue Growth

Negative revenue growth indicates challenges in market demand or competitive pressures, potentially impacting long-term profitability and market position.

Gross Margin Decline

Declining gross margins due to cost escalations and customer mix can pressure profitability, affecting the company's ability to sustain competitive pricing.

Operating Margin Decline

A decline in operating margins reflects operational inefficiencies or increased costs, potentially limiting the company's ability to invest in growth initiatives.

MSC Industrial Business Overview & Revenue Model

Company Description

MSC Industrial Direct Co., Inc., together with its subsidiaries, distributes metalworking and maintenance, repair, and operations (MRO) products and services in the United States, Canada, Mexico, and the United Kingdom. Its MRO products include cutting tools, measuring instruments, tooling components, metalworking products, fasteners, flat stock products, raw materials, abrasives, machinery hand and power tools, safety and janitorial supplies, plumbing supplies, materials handling products, power transmission components, and electrical supplies. The company offers approximately 1.9 million stock-keeping units through its catalogs and brochures; e-commerce channels, including its Website, mscdirect.com; inventory management solutions; and call-centers and branches. It operates through a distribution network of 28 branch offices, 11 customer fulfilment centers, and seven regional inventory centers. The company serves individual machine shops, Fortune 1000 manufacturing companies, and government agencies, as well as manufacturers of various sizes. MSC Industrial Direct Co., Inc. was founded in 1941 and is headquartered in Melville, New York.

How the Company Makes Money

MSC Industrial generates revenue primarily through the sale of industrial supplies and tools. The company's revenue model is built on a combination of direct sales, e-commerce transactions, and a robust catalog system that allows customers to order products easily. Key revenue streams include sales from metalworking tools, MRO products, and safety equipment, with significant contributions from both small and large business customers. MSC also benefits from long-term relationships with suppliers and manufacturers, which enable it to offer a wide range of products at competitive prices. In addition, the company invests in technology and logistics to improve customer service and streamline operations, further enhancing its ability to generate consistent revenue.

MSC Industrial Financial Statement Overview

Summary

MSC Industrial demonstrates stable gross profit margins and a solid balance sheet with moderate leverage. However, declining revenue and net profit margins indicate challenges in maintaining profitability. Cash flow performance is mixed, with strong free cash flow growth but reduced operating cash flow. Overall, the company shows resilience but faces profitability and growth challenges.

Income Statement

MSC Industrial shows a stable gross profit margin around 41%, indicating consistent cost management. However, the net profit margin decreased from 6.77% to 5.29%, reflecting reduced profitability. Revenue growth is negative at -4.70%, suggesting a decline in sales. The EBIT margin dropped significantly, indicating operational challenges.

Balance Sheet

The company maintains a healthy debt-to-equity ratio of 0.39, showing moderate leverage. Return on equity decreased from 18.58% to 14.36%, indicating reduced efficiency in generating profits from equity. The equity ratio remains stable, reflecting a balanced asset structure.

Cash Flow

Operating cash flow decreased, impacting the operating cash flow to net income ratio, which fell from 0.68 to 0.46. However, free cash flow grew by 26.62%, and the free cash flow to net income ratio improved to 1.0, indicating strong cash generation relative to net income.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2019	Dec 2018	Dec 2017
Income Statement
Total Revenue	3.77B	3.77B	3.82B	3.36B	3.20B	2.89B
Gross Profit	1.54B	1.54B	1.57B	1.43B	1.39B	1.29B
EBITDA	377.82M	377.82M	451.03M	465.01M	483.28M	442.94M
Net Income	199.33M	199.33M	258.59M	288.87M	329.22M	231.43M
Balance Sheet
Total Assets	2.46B	2.46B	2.46B	2.31B	2.29B	2.10B
Cash, Cash Equivalents and Short-Term Investments	56.23M	56.23M	29.59M	32.29M	46.22M	16.08M
Total Debt	538.81M	538.81M	568.17M	441.88M	535.33M	532.98M
Total Liabilities	1.07B	1.07B	1.06B	827.36M	901.47M	873.77M
Stockholders Equity	1.39B	1.39B	1.39B	1.48B	1.39B	1.23B
Cash Flow
Free Cash Flow	240.88M	333.72M	311.29M	276.65M	294.74M	200.29M
Operating Cash Flow	333.72M	333.72M	410.70M	328.43M	339.66M	246.84M
Investing Cash Flow	-63.29M	-63.29M	-123.40M	-35.45M	-131.92M	-88.89M
Financing Cash Flow	-243.57M	-243.57M	-307.35M	-306.55M	-177.59M	-194.75M

MSC Industrial Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 85.59
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MSM, the sentiment is Negative. The current price of 85.59 is below the 20-day moving average (MA) of 86.13, below the 50-day MA of 89.13, and above the 200-day MA of 82.92, indicating a neutral trend. The MACD of -0.96 indicates Negative momentum. The RSI at 44.28 is Neutral, neither overbought nor oversold. The STOCH value of 43.26 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for MSM.

MSC Industrial Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
AIT	74 Outperform	$9.67B	24.67	22.10%	0.68%	4.03%	5.93%
GWW	73 Outperform	$45.76B	26.86	48.98%	0.90%	4.83%	-3.60%
GIC	72 Outperform	$1.08B	15.94	22.61%	2.93%	0.16%	2.99%
DXPE	70 Outperform	$1.92B	23.30	20.33%	―	13.93%	48.25%
FAST	67 Neutral	$47.41B	38.72	32.74%	2.15%	6.92%	5.98%
MSM	64 Neutral	$4.82B	24.23	14.34%	3.97%	-1.35%	-22.24%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%

MSC Industrial Corporate Events

MSC Industrial Direct Faces Financial Uncertainty Amid New Tax Legislation

Msc Industrial Direct faces potential financial challenges due to changes in tax legislation and compliance requirements. The One Big Beautiful Bill Act, enacted in fiscal year 2025, introduced significant tax reforms, though it initially did not materially impact the company’s tax rates or obligations. However, the evolving nature of tax laws and the political environment in the United States could lead to increased compliance costs and unpredictable tax liabilities. Misinterpretation or misapplication of these new laws could further exacerbate financial risks, affecting the company’s overall financial results.

MSC Industrial Supply Co. Reports Fiscal 2025 Results

MSC Industrial Supply Co., a prominent North American distributor of metalworking and maintenance, repair, and operations (MRO) products, has released its fiscal 2025 fourth quarter and full-year financial results, showcasing its role in enhancing productivity and profitability for its clients across various industries.

MSC Industrial Direct’s Mixed Earnings Call Reveals Growth and Challenges

MSC Industrial Direct’s recent earnings call painted a mixed picture for investors, highlighting both positive growth trends and notable challenges. The company reported encouraging developments in daily sales growth and EPS improvement, alongside strategic initiatives such as the expansion of high-touch solutions. However, concerns were raised over declining gross margins, underperformance in national accounts, and the impact of the government shutdown on public sector sales.

MSC Industrial Reports Q4 2025 Financial Results

On October 23, 2025, MSC Industrial Supply Co. reported its fiscal 2025 fourth quarter and full-year financial results, highlighting a 2.7% year-over-year increase in net sales for the fourth quarter, reaching $978.2 million. Despite a 1.3% decrease in full-year net sales, the company achieved a positive cash flow conversion and returned $229 million to shareholders through dividends and share repurchases. The company’s strategic focus on high-touch solutions, core customer engagement, and cost optimization has led to growth in daily sales and earnings per share, positioning it for profitable growth in fiscal 2026.

The most recent analyst rating on (MSM) stock is a Buy with a $93.00 price target. To see the full list of analyst forecasts on MSC Industrial stock, see the MSM Stock Forecast page.

MSC Industrial Increases Dividend by 2.4%

On October 7, 2025, MSC Industrial Supply Co. announced that its Board of Directors declared a cash dividend of $0.87 per share, marking a 2.4% increase from the previous dividend. This decision reflects the company’s commitment to providing value to its shareholders and may enhance its market positioning by demonstrating financial stability and growth potential.

The most recent analyst rating on (MSM) stock is a Hold with a $98.00 price target. To see the full list of analyst forecasts on MSC Industrial stock, see the MSM Stock Forecast page.