Federal Signal (NYSE:FSS) Posts Quarterly Earnings Results, Beats Expectations By $0.08 EPS

Federal Signal (NYSE:FSS) issued its quarterly earnings results on Wednesday. The conglomerate reported $1.16 earnings per share (EPS) for the quarter, topping analysts’ consensus estimates of $1.08 by $0.08, Briefing.com reports. The business had revenue of $597.10 million for the quarter, compared to the consensus estimate of $551.36 million. Federal Signal had a return on equity of 19.50% and a net margin of 11.47%.The firm’s quarterly revenue was up 26.5% compared to the same quarter last year. During the same quarter in the prior year, the business posted $0.87 earnings per share. Federal Signal updated its FY 2026 guidance to 4.500-4.800 EPS.

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

• Federal Signal delivered a record 2025 with net sales of $2.18B (up 17%), organic growth of 11%, adjusted EBITDA of $438.9M (20.1% margin) and adjusted EPS of $4.23, all materially above prior year levels.
• Q4 momentum was strong — sales of $597M (up 27%), orders of $647M (up 45%, including $132M acquired backlog), adjusted EBITDA of $119.4M (20% margin) and higher GAAP and adjusted EPS versus Q4 2024.
• M&A activity accelerated with the acquisitions of New Way and Mega; New Way is expected to be roughly adjusted EPS neutral in 2026 and to deliver $15M–$20M of annual synergies by 2028 while the company transitions Canadian refuse distribution away from third?party Labrie (winding down ~$80M of Labrie backlog over the next year).
• Near-term headwinds include higher acquisition and integration expenses (Q4 corporate op ex rose to $26.5M, driven by ~$13M of acquisition costs), increased intangible amortization and a normalization of the tax rate to ~25%, together creating an aggregate ~$0.16/share headwind in 2026.
• Financial flexibility remains solid — net debt of $501M, $925M of credit availability under a new five?year facility, strong operating cash flow ($255M for the year) and capacity to fund growth, M&A, debt reduction, dividends and opportunistic buybacks.

Federal Signal Price Performance

FSS stock traded up $0.88 during midday trading on Thursday, reaching $120.30. 33,190 shares of the stock were exchanged, compared to its average volume of 378,700. Federal Signal has a 52 week low of $66.47 and a 52 week high of $132.89. The company has a fifty day moving average price of $114.40 and a 200 day moving average price of $117.35. The company has a debt-to-equity ratio of 0.15, a current ratio of 2.61 and a quick ratio of 1.25. The stock has a market capitalization of $7.32 billion, a PE ratio of 31.40, a P/E/G ratio of 1.82 and a beta of 1.35.

Wall Street Analysts Forecast Growth

Several research firms have commented on FSS. CJS Securities raised shares of Federal Signal from a “market perform” rating to a “market outperform” rating and set a $140.00 target price on the stock in a report on Thursday. Weiss Ratings reissued a “buy (b-)” rating on shares of Federal Signal in a research note on Monday, December 29th. Three research analysts have rated the stock with a Buy rating and three have given a Hold rating to the company’s stock. According to data from MarketBeat, Federal Signal has an average rating of “Moderate Buy” and an average target price of $126.75.

Federal Signal News Roundup

Here are the key news stories impacting Federal Signal this week:

• Positive Sentiment: Q4 beat — Federal Signal reported $1.16 EPS vs. $1.08 expected and revenue of $597.1M, up ~26–27% year?over?year, signaling accelerating demand and margin improvement. Federal Signal (FSS) Surpasses Q4 Earnings and Revenue Estimates
• Positive Sentiment: Raised outlook and strong annual results — management issued FY2026 EPS guidance of $4.50–4.80 and revenue guidance of $2.6–2.7B, alongside PR highlighting record orders, cash generation and a 19% operating income increase. That revenue range sits above consensus and supports growth expectations. Federal Signal Completes Record Year (PR Newswire)
• Positive Sentiment: Analyst upgrade — CJS Securities moved FSS from “market perform” to “market outperform” and set a $140 price target (~14% above recent levels), giving the stock additional upward momentum. Benzinga
• Positive Sentiment: Market coverage and reaction — multiple outlets highlight that strong Q4 results and guidance drove the stock move and renewed valuation conversations. Federal Signal Delivers Strong Q4 (Yahoo)
• Neutral Sentiment: Earnings call transcript available for details on segment performance and management commentary (useful for parsing sustainability of margins and orders). Earnings Call Transcript
• Neutral Sentiment: Company slide deck and press release provide supporting detail on results and cash flow; review for guidance assumptions and segment outlook. Press Release / Slide Deck
• Neutral Sentiment: Analysts and commentators are re?examining valuation after the updated guidance — useful for investors deciding if recent gains are warranted versus current P/E (~32). Valuation Article
• Neutral Sentiment: Acquisition watch — coverage notes potential for recent or future M&A to support growth, but impact depends on execution and integration. Can Acquisition Fuel Growth?

Institutional Trading of Federal Signal

Several hedge funds and other institutional investors have recently made changes to their positions in FSS. EverSource Wealth Advisors LLC raised its holdings 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 last quarter. Caitong International Asset Management Co. Ltd increased its position in Federal Signal by 3,100.0% in the 3rd quarter. Caitong International Asset Management Co. Ltd now owns 256 shares of the conglomerate’s stock valued at $30,000 after acquiring an additional 248 shares during the period. UMB Bank n.a. increased its position in Federal Signal by 50.5% in the 4th quarter. UMB Bank n.a. now owns 331 shares of the conglomerate’s stock valued at $36,000 after acquiring an additional 111 shares during the period. Meeder Asset Management Inc. bought a new position in shares of Federal Signal during the fourth quarter valued at $38,000. Finally, Danske Bank A S acquired a new position in shares of Federal Signal during the third quarter worth $48,000. 92.73% of the stock is currently owned by institutional investors.

About Federal Signal

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.