Federal Signal (NYSE:FSS) Issues Earnings Results

Federal Signal (NYSE:FSS) posted its quarterly earnings results on Thursday. The conglomerate reported $1.42 earnings per share (EPS) for the quarter, topping analysts’ consensus estimates of $1.29 by $0.13, Briefing.com reports. The company had revenue of $670.20 million for the quarter, compared to the consensus estimate of $667.04 million. Federal Signal had a net margin of 11.56% and a return on equity of 21.18%. The company’s revenue for the quarter was up 18.7% on a year-over-year basis. During the same period last year, the firm posted $1.17 EPS. Federal Signal updated its FY 2026 guidance to 5.120-5.300 EPS.

Here are the key takeaways from Federal Signal’s conference call:

• Record second-quarter results: Net sales rose 19% year over year to $670 million, while adjusted EBITDA increased 22% to $144.4 million and adjusted EPS grew 21% to $1.42. Orders increased 18% to $637 million, supported by broad-based demand.
• Federal Signal raised its 2026 adjusted EPS outlook to $5.12–$5.30 from $4.80–$5.05 and increased its revenue outlook to $2.58–$2.67 billion. Management cited strong second-quarter execution, backlog, aftermarket momentum, and acquisition performance.
• Environmental Solutions Group sales grew 20% and adjusted EBITDA rose 25%, with aftermarket revenue up 24% to roughly 25% of ESG revenue. Management expects continued aftermarket expansion through parts manufacturing, additional service locations, rentals, used equipment, and acquisition-related opportunities.
• New Way and Mega are performing ahead of internal profit and margin expectations, with New Way tracking ahead of its cost-synergy targets. The company also completed the small Western Technology acquisition and described an active M&A pipeline across both operating groups.
• Backlog was approximately $1 billion, down 8% year over year largely because third-party Labrie refuse orders are being phased out, but management said backlog-driven products still provide strong forward visibility. Safety and Security Systems’ adjusted EBITDA margin declined to 25.1% from 26.9% because of product and shipment mix, though it remained within the company’s 22%–28% target range.

Federal Signal Trading Up 11.2%

Shares of NYSE:FSS traded up $12.57 during mid-day trading on Thursday, hitting $124.43. The stock had a trading volume of 901,435 shares, compared to its average volume of 491,500. The company’s 50 day moving average is $116.67 and its 200-day moving average is $114.76. The company has a debt-to-equity ratio of 0.38, a quick ratio of 1.29 and a current ratio of 2.84. Federal Signal has a 12-month low of $101.18 and a 12-month high of $134.51. The company has a market cap of $7.59 billion, a PE ratio of 28.28, a P/E/G ratio of 1.70 and a beta of 1.23.

Federal Signal Dividend Announcement

The company also recently declared a quarterly dividend, which will be paid on Thursday, August 27th. Stockholders of record on Friday, August 14th will be issued a dividend of $0.15 per share. The ex-dividend date is Friday, August 14th. This represents a $0.60 dividend on an annualized basis and a dividend yield of 0.5%. Federal Signal’s payout ratio is currently 13.64%.

Institutional Inflows and Outflows

Large investors have recently bought and sold shares of the business. EverSource Wealth Advisors LLC increased its stake in Federal Signal by 140.6% in the 2nd quarter. EverSource Wealth Advisors LLC now owns 243 shares of the conglomerate’s stock valued at $26,000 after buying an additional 142 shares during the period. Caitong International Asset Management Co. Ltd lifted its holdings in shares of Federal Signal by 3,100.0% during the 3rd quarter. Caitong International Asset Management Co. Ltd now owns 256 shares of the conglomerate’s stock valued at $30,000 after buying an additional 248 shares during the last quarter. UMB Bank n.a. raised its holdings in shares of Federal Signal by 50.5% during the 4th quarter. UMB Bank n.a. now owns 331 shares of the conglomerate’s stock valued at $36,000 after purchasing an additional 111 shares in the last quarter. Meeder Asset Management Inc. bought a new stake in Federal Signal in the fourth quarter worth $38,000. Finally, Danske Bank A S acquired a new position in Federal Signal during the third quarter worth $48,000. 92.73% of the stock is owned by institutional investors and hedge funds.

Analyst Upgrades and Downgrades

Several equities analysts have recently issued reports on the company. DA Davidson boosted their price objective on Federal Signal from $125.00 to $132.00 and gave the stock a “neutral” rating in a research report on Friday, May 1st. KeyCorp reiterated an “overweight” rating and issued a $140.00 price objective on shares of Federal Signal in a report on Thursday, April 30th. Wall Street Zen upgraded Federal Signal from a “hold” rating to a “buy” rating in a research report on Saturday, May 2nd. Zacks Research upgraded Federal Signal from a “hold” rating to a “strong-buy” rating in a research report on Monday, May 4th. Finally, Weiss Ratings raised Federal Signal from a “buy (b-)” rating to a “buy (b)” rating in a research note on Tuesday, June 23rd. One equities research analyst has rated the stock with a Strong Buy rating, four have given a Buy rating and one has assigned a Hold rating to the company. Based on data from MarketBeat, the company presently has a consensus rating of “Buy” and an average target price of $139.25.

Federal Signal Company Profile

Federal Signal Corporation (NYSE: FSS), headquartered in Oak Brook, Illinois, is a diversified industrial company that designs, manufactures and markets a broad range of products and services for municipal, commercial and industrial customers worldwide. Founded in 1901 in Chicago, the company has grown through a combination of organic investment and strategic acquisitions to become a leading provider of environmental management and safety and security solutions.

Federal Signal operates through two primary business segments.