Applied Industrial Technologies, Inc. (AIT) vs MSC Industrial Direct Company, Inc. (MSM)

Applied Industrial Technologies, Inc. and MSC Industrial Direct Company, Inc. are both Industrial Distribution companies. Applied Industrial Technologies, Inc. is the larger, with a market value of $12.2B against $6.7B — 1.8× the size. MSC Industrial Direct Company, Inc. trades at the lower P/E: 29.3× against 30.1×. Applied Industrial Technologies, Inc. grew revenue faster over the last twelve months: 8.84% against 4.41%. Applied Industrial Technologies, Inc. has the higher net margin (8.35% vs 5.91%) and the higher return on invested capital (17.2% vs 11.2%). Both pay a dividend; MSC Industrial Direct Company, Inc. yields more (3.39% vs 0.78%). Across the 23 metrics below, Applied Industrial Technologies, Inc. leads on 15 and MSC Industrial Direct Company, Inc. on 8.

Valuation

Metric AIT MSM Industrial Distribution median
P/E 30.08 29.28 28.81
P/S 2.51 1.73 1.10
P/B 6.70 4.77 3.59
Price to free cash flow 27.03 30.63 22.50
EV/EBITDA 20.34 16.66 15.13
EV/Sales 2.54 1.84 1.31
Earnings yield 3.32% 3.42% 3.16%
Free cash flow yield 3.70% 3.26% 3.85%

Profitability

Metric AIT MSM Industrial Distribution median
Gross margin 30.34% 40.82% 30.34%
Operating margin 11.06% 8.50% 8.06%
Net margin 8.35% 5.91% 4.95%
Free cash flow margin 9.29% 5.65% 4.67%
Return on equity 22.37% 16.54% 14.29%
Return on assets 13.40% 9.30% 5.30%
Return on invested capital 17.20% 11.21% 8.13%

Growth

Metric AIT MSM Industrial Distribution median
Revenue growth (TTM) 8.84% 4.41% 7.80%
EPS growth (last fiscal year) 8.20% (22.05%) —
Revenue growth, 5-year CAGR 8.95% 3.38% 9.01%
Net income growth, 5-year CAGR 23.42% (4.51%) 0.99%

Health

Metric AIT MSM Industrial Distribution median
Debt to equity 0.14 0.36 0.53
Current ratio 2.58 1.55 2.47
Net debt to EBITDA 0.22 1.09 1.17

Dividend

Metric AIT MSM Industrial Distribution median
Dividend yield 0.78% 3.39% 1.54%
Payout ratio 0.16 0.49 0.00

Size

Metric AIT MSM Industrial Distribution median
Market cap 12.20b 6.74b 5.60b

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