MSA Safety Incorporated (MSA) is one of the leaders in the safety equipment and solutions industry and MSA shares have crushed the S&P 500 during the last 25 years and the past decade.
MSA Safety found support at some key moving averages and its earnings outlook has surged over the last year. MSA Safety also pays a dividend and it trades 14% below its average Zacks price target. These are just some of the core reasons to consider buying MSA Safety stock.
Protecting Workers, Industries & Your Portfolio
MSA Safety is a worldwide leader in the development, manufacture, and supply of safety products and solutions. The company, which was started back in 1914, seeks to integrate electronics, software, mechanical systems, and advanced materials across its offerings to help keep people safe in tons of settings.
MSA Safety’s wide range of equipment and gear services industries such as fire services, construction, oil and gas, utilities, industrial manufacturing, mining, the military, and beyond. MSA Safety’s various equipment protect its users against hazardous and life-threatening situations that many people in critical, hard-to-automate jobs experience every day.
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MSA Safety’s portfolio spans from self-contained breathing equipment and portable gas detection to helmets, fall protection, and beyond. The company also offers on-demand, interactive certification training programs across various fields alongside other safety training efforts and more.
Growth Outlook & Earnings Revisions
MSA Safety’s revenue is projected to climb by 15% in fiscal 2023 to reach $1.76 billion and then pop another 5.5% in 2024 to hit $1.86 billion. This expected growth would follow 9% sales expansion in FY22.
The company’s adjusted earnings are projected to soar by 22% in FY23 and then jump 8% higher next year, based on the most recent Zacks estimates. MSA Safety’s bottom-line outlook appears even more impressive considering that it already posted 21% adjusted earnings expansion in fiscal 2022.
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MSA Safety has topped our bottom-line estimates for eight straight quarters, including an average beat of 22% in the past four periods. More importantly, MSA Safety’s earnings estimates for FY23 and FY24 have climbed by 25% and 20%, respectively over the last year to help it land a Zacks Rank #1 (Strong Buy) right now.
Performance, Technical Levels & Valuation
MSA shares have soared over 2,200% in the past 25 years to blow away the S&P 500’s 370% run and the Zacks Industrial Products sector’s 180%. The impressive outperformance remained during the trailing 10 years, with the stock up 250% vs. the benchmark’s 180% and its sector’s 60%.
MSA stock has come back to the pack over the last five years, underperforming the S&P 500. MSA stock is trading around where it was three years ago. MSA shares are currently floating around 8% below their early September highs and 14% under their average Zacks price target.
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MSA Safety found support at its 50-week moving average in late October and it is trading above its 21-week moving average and at neutral RSI levels, after landing firmly above overbought when it reached new highs in September. MSA is also trading above both its 21-day and 50-day moving averages right now.
The recent pullback, coupled with its strong earnings outlook helps MSA shares trade at a 37% discount to their 10-year highs and right near their median at 22.4X forward 12-month earnings.
Bottom Line
MSA Safety’s dividend yields 1.1% right now and its balance is stable. The company is poised to grow because its offerings are the definition of essential across critical industries that are in constant demand. Better yet, the firm is benefitting from long-term secular trends across various parts of the U.S. and global economies, including infrastructure and energy expansion.
MSA Safety’s lack of flash is part of its long-term appeal. Investors might want to consider buying the safety equipment and technology stock, with its fourth quarter earnings projected to be released on February 21.
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