William Blair & Company initiated research coverage of MSA Safety Incorporated (MSA $98.08). MSA Safety is a global manufacturer of sophisticated safety products that help protect workers and facility infrastructure. Core products include breathing apparatus, firefighter helmets and protective apparel, fixed gas and flame detection instruments, portable gas detection instruments, industrial head protection products, and fall protection devices.
Analyst Larry De Maria estimated that MSA would generate EPS of $4.50 in 2018, $4.90 in 2019, and $5.30 in 2020.
“We believe MSA Safety has 1) a strong organic growth outlook; 2) operational efficiency upside to drive margins, especially in Europe; 3) a fairly defensive business model; 4) a strong free cash flow profile and ROIC; and 5) balance sheet optionality including likely further accretive M&A activity,” De Maria said. “MSA has undergone an extensive transformation over the past decade from operating as a pseudo-private company to a well-run company focused on productivity, margin expansion, growth (organic and M&A), and cash flow. The company has a No. 1 or 2 market position globally in nearly all of its core products. Technological innovation and safety provide high barriers to entry.”
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Current Ratings Distribution (as of 1/9/19)
Outperform (Buy): 67%
Market Perform (Hold): 32%
Underperform (Sell): 1%
Inv. Banking Relationships*
Outperform (Buy): 21%
Market Perform (Hold): 7%
Underperform (Sell): 0%
* Percentage of companies in each rating category that are investment banking clients, defined as companies for which William Blair has received compensation for investment banking services within the past 12 months.
The compensation of the research analyst is based on a variety of factors, including the quality and accuracy of research, client feedback, contributions to other firm departments, competitive factors, and firm profitability.
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