Deere & Company (DE) vs Federal Signal Corporation (FSS)

Deere & Company and Federal Signal Corporation are both Farm & Heavy Construction Machinery companies. Deere & Company is the larger, with a market value of $175.4B against $6.9B — 25.3× the size. Federal Signal Corporation trades at the lower P/E: 24.0× against 35.6×. Federal Signal Corporation grew revenue faster over the last twelve months: 24.0% against 7.99%. Federal Signal Corporation has the higher net margin (11.7% vs 10.2%) and the higher return on invested capital (13.0% vs 4.93%). Both pay a dividend; Deere & Company yields more (1.01% vs 0.52%). Across the 23 metrics below, Federal Signal Corporation leads on 19 and Deere & Company on 4.

Valuation

Metric DE FSS Farm & Heavy Construction Machinery median
P/E 35.56 23.96 23.28
P/S 3.61 2.80 0.75
P/B 6.19 4.54 1.43
Price to free cash flow 21.62 20.18 22.25
EV/EBITDA 19.40 14.90 11.41
EV/Sales 4.73 2.96 1.14
Earnings yield 2.81% 4.17% 2.83%
Free cash flow yield 4.62% 4.96% 2.91%

Profitability

Metric DE FSS Farm & Heavy Construction Machinery median
Gross margin 36.59% 29.17% 24.21%
Operating margin 19.47% 16.15% 4.47%
Net margin 10.16% 11.66% 1.49%
Free cash flow margin 16.69% 13.86% 2.15%
Return on equity 18.33% 20.61% 3.99%
Return on assets 4.52% 13.10% 1.31%
Return on invested capital 4.93% 13.02% 3.36%

Growth

Metric DE FSS Farm & Heavy Construction Machinery median
Revenue growth (TTM) 7.99% 23.97% 2.18%
EPS growth (last fiscal year) (27.79%) 14.57% (27.79%)
Revenue growth, 5-year CAGR 5.15% 14.03% 7.34%
Net income growth, 5-year CAGR 12.81% 20.72% 0.00%

Health

Metric DE FSS Farm & Heavy Construction Machinery median
Debt to equity 2.28 0.30 0.67
Current ratio 2.10 2.74 1.98
Net debt to EBITDA 4.65 1.19 1.12

Dividend

Metric DE FSS Farm & Heavy Construction Machinery median
Dividend yield 1.01% 0.52% 1.34%
Payout ratio 0.36 0.13 0.30

Size

Metric DE FSS Farm & Heavy Construction Machinery median
Market cap 175.44b 6.93b 808.87m

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