MSC Industrial (MSM) Buys Majority Stakes in Wm. F. Hurst

MSC Industrial Supply Co. MSM yesterday announced that it acquired majority interests in Wichita, KS-based Wm. F. Hurst Co., LLC. The financial terms of the transaction are not yet disclosed.


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Notably, MSC Industrial’s shares gained 0.77% in Tuesday’s trading session, closing at $95.13.

Inside the Headlines

Wm. F. Hurst engages in distributing metalworking tools as well as supplies for customers in the aerospace industry. It has offices in Dallas, TX; Wichita, KS; and Kansas City, MO.

Per the buyout terms, Wm. F. Hurst will retain its original name and operate as a company of MSC Industrial. Also, John Mullen will hold a minority stake in the acquired entity and continue to lead its operations.

The acquisition is anticipated to strengthen MSC Industrial’s presence in the metalworking industry. Also, it will enhance the company’s technical capabilities and exposure in the aerospace domain.

MSC Industrial’s Buyout Activities

Acquiring businesses is an effective way for the company to gain access to new markets, expand its product line and grow its customer base. Notably, the company has invested $100.9 million in making acquisitions in the past three fiscal years (2018-2020).

Markedly, except for the Wm. F. Hurst buyout, MSC Industrial has refrained from indulging in other acquisition activities so far in fiscal 2021.

Zacks Rank, Estimate Trend and Price Performance

With a $5.3-billion market capitalization, MSC Industrial currently carries a Zacks Rank #3 (Hold). The company is poised to benefit from healthy demand for products, synergistic gains from its purchased assets and growth investments. Rise in the cost of sales might be concerning.

In the past three months, shares of the company have rallied 12.9% against the industry’s decline of 5.8%.

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The Zacks Consensus Estimate for earnings is pegged at $4.74 for fiscal 2021 (ending August 2021) and $5.20 for fiscal 2022 (ending August 2022), indicating growth of 0.6% and 0.4% each from the respective 30-day-ago figures. Also, the company’s earnings estimate for the third quarter of fiscal 2021 (ended May 2021, results yet to be released) is pegged at 41.38 per share, suggesting no change from the 30-day-ago figure.

MSC Industrial Direct Company, Inc. Price and Consensus

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MSC Industrial Direct Company, Inc. Price and Consensus

MSC Industrial Direct Company, Inc. price-consensus-chart | MSC Industrial Direct Company, Inc. Quote

Stocks to Consider

Some better-ranked stocks in the industry are SiteOne Landscape Supply, Inc. SITE, ScanSource, Inc. SCSC and W.W. Grainger, Inc. GWW. While SiteOne currently sports a Zacks Rank #1 (Strong Buy), both ScanSource and W.W. Grainger carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

In the past 30 days, estimates for these companies’ earnings have improved for the current year. Also, earnings surprise for the last reported quarter was 136.36% for SiteOne, 33.96% for ScanSource and 3.94% for W.W. Grainger.

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