Federal Signal: A Great Growth Stock with Strong Earnings and Cash Flow Growth

Federal Signal (FSS) is a great growth stock due to its strong earnings growth of 19.4%, exceeding the industry average of 7.4%. The company also boasts cash flow growth of 24.6%, higher than the industry average of -9.2%. Furthermore, its annualized cash flow growth rate has been 12.2% over the past 3-5 years, surpassing the industry average of 5.3%.

Title: Federal Signal (FSS) Outpaces Conglomerates Peers with Strong Growth Metrics

Federal Signal (FSS) has been a standout performer among its Conglomerates sector peers, showcasing robust growth metrics that have drawn the attention of investors. As of July 2, 2025, the company has demonstrated a remarkable year-to-date performance, outpacing its sector averages significantly.

Federal Signal's earnings growth of 19.4% for the current year surpasses the industry average of 7.4%, indicating strong financial health and future prospects. Additionally, the company's cash flow growth rate of 24.6% stands well above the industry average of -9.2%, suggesting a healthy cash flow environment that supports expansion and investment. Over the past 3-5 years, Federal Signal's annualized cash flow growth rate has been 12.2%, outpacing the industry average of 5.3% [1].

The company's impressive performance is further validated by its Zacks Rank, currently at #1 (Strong Buy), and a Growth Score of B, which highlights its potential to outperform the market. Analysts have also noted upward revisions in earnings estimates, with the Zacks Consensus Estimate for the current year increasing by 4.9% over the past month [2].

Federal Signal's Q2 2025 earnings report, released on July 30, 2025, showed an EPS of $1.17, beating analysts' consensus estimates of $1.06 by $0.11. Quarterly revenue rose 15.1% year-over-year to $564.60 million, exceeding analyst estimates of $537.24 million. The company's earnings are expected to grow 12.57% next year, from $3.34 to $3.76 per share, with a P/E Ratio of 34.97 [3].

In summary, Federal Signal's strong earnings growth, robust cash flow, and positive analyst sentiment make it a compelling growth stock for investors. The company's continued performance suggests that it is well-positioned to capitalize on market opportunities and deliver exceptional returns.

References
[1] https://www.nasdaq.com/articles/federal-signal-fss-stock-outpacing-its-conglomerates-peers-year-0
[2] https://finviz.com/news/145599/3-reasons-why-federal-signal-fss-is-a-great-growth-stock
[3] https://www.marketbeat.com/stocks/NYSE/FSS/earnings/