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Federal Signal (FSS) Buys PWE, Expands Business Footprint

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Federal Signal Corporation (FSS - Free Report) announced that it completed the buyout of some assets and operations of Public Works Equipment and Supply, Inc. (“PWE”). Notably, the buyout, which involved a purchase price worth $2.5 million, also included an extra payment for the purchase of some of PWE’s fixed assets and inventory. The company’s share price increased 2.3% to eventually close at $29.84 yesterday.

PWE is engaged in providing maintenance and infrastructure equipment to municipalities and industrial customers, particularly in North Carolina, South Carolina and Tennessee regions. Some of the products offered by the company include sewer cleaners, street sweepers, hydro- and vacuum-excavation trucks, road maintenance equipment, and pipeline inspection systems.

The acquisition will likely help Federal Signal in expanding its business footprint apart from strengthening its customer base and aftermarket business. Notably, PWE, which will be incorporated into the company’s Environmental Solutions Group, will continue to run its Elgin and Vactor product lines, and other brands.

Zacks Rank, Price Performance and Estimate Trend

The company, with a $1.8-billion market capitalization, currently carries a Zacks Rank #3 (Hold).

Over the past three months, its share price has increased 7% compared with the industry’s growth of 12.9%.

 


 

Earnings estimates for Federal Signal have been lowered in the past 60 days. Currently, the Zacks Consensus Estimate for the bottom line is pegged at $1.52 for 2020, reflecting a decline of 14.1% from the 60-day-ago figure. In addition, the consensus estimate for its earnings has declined by 6.8% to $1.77 for 2021 over the same time frame.

Stocks to Consider

Some better-ranked stocks are Intellicheck, Inc. (IDN - Free Report) , Astec Industries, Inc. (ASTE - Free Report) and Energy Recovery, Inc. (ERII - Free Report) . All the companies currently carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Intellicheck delivered a positive earnings surprise of 70.24%, on average, in the trailing four quarters.

Astec Industries delivered a positive earnings surprise of 6.68%, on average, in the trailing four quarters.

Energy Recovery delivered a positive earnings surprise of 66.67%, on average, in the trailing four quarters.

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