One-glance verdict
Within fair range
$36.82 our estimate vs market $34.43
Wall Street consensus: $44.00 (19.5% higher than our fair-value estimate)
7% below our estimate
Fundamentals snapshot
L.B. Foster Company
FSTR · NMS · Industrials · Railroads
Current price
$34.43
52-week range
$23.81 - $45.81
Market cap
$362.20M
Balance sheet
Watch
4.48x Stretched
Net debt $64.54M. Interest coverage shows how many times profit covers the interest bill.
What stands out
2 Rewards
0 Risks
2 rewards · 0 risks
- Reward Returns 6.4% on equity, ahead of 25% of its peers.
- Reward Free cash flow was positive in 8/10 years.
What this company does
L.B. Foster Company
L.B. Foster Company makes and sells products that help build and maintain important structures like railroads and bridges. Their money comes from selling these infrastructure products and services, which is important because it shows how much demand there is for building and fixing things across the country and beyond.
How the company got here
L.B. Foster Company was founded in 1902 by Lee B. Foster, starting as a distributor of used steel rail to coal mines. For many years, the company focused on recycling and reselling "relay" rail, a foundational business that has continued in various forms. Over the decades, L.B. Foster expanded its offerings beyond rail products, venturing into markets like tubular products for the oil and gas industry, and later into precast concrete and fabricated steel for infrastructure projects. This diversification, including strategic acquisitions and divestitures over the years, has shaped the company into a provider of engineered products and services for both the rail and broader infrastructure sectors.
What it actually does
L.B. Foster Company provides essential products and services that help build and maintain critical infrastructure, primarily in the rail and transportation sectors. Think of them as a behind-the-scenes supplier for the systems that keep goods and people moving. They offer everything from the steel rails themselves to specialized components that ensure tracks are safe and efficient, as well as concrete structures and protective coatings for various infrastructure needs. Their work focuses on engineering solutions that enhance safety, reliability, and performance for their customers' projects.
Rail Technologies and Services
This segment is a major part of L.B. Foster's business, making up about 56% of its revenue. They supply new and used steel rails, along with all the necessary accessories like spikes and bolts that hold the tracks together. Beyond just the tracks, this division also offers advanced technology solutions. This includes systems that monitor the condition of the rails and equipment to manage friction, which helps trains run more smoothly and safely. They serve freight and passenger railroads, as well as industrial companies that rely on rail transport.
Infrastructure Solutions
This segment accounts for roughly 44% of the company's revenue and focuses on products for a wide range of infrastructure projects. They manufacture precast concrete products, such as buildings for parks and sound walls, and also provide steel products for bridges. Additionally, this division offers services like protective coatings for pipes and steel fabrication. Customers in this segment include those involved in transportation, energy, and general construction projects.
What management is betting on now
L.B. Foster's current strategy centers on transforming the company's profitability by focusing on growth in key areas like Rail Technologies and Precast Concrete. Management is investing in technology to develop new products and services that improve efficiency and safety for their customers. They aim to leverage their engineering expertise to solve complex infrastructure challenges and are committed to environmental, health, and safety excellence. The company is also focused on generating strong cash flow and improving its financial leverage, partly through strategic share repurchases.
Price history
How the share price has moved
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Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
FY2024 Q3
$21.68M
FY2024 Q4
$22.33M
FY2025 Q1
$-28.71M
FY2025 Q2
$7.73M
FY2025 Q3
$26.37M
FY2025 Q4
$19.80M
FY2026 Q1
$-13.40M
FY2026 Q2
$14.30M
Revenue
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Net income
$3.11M
Diluted EPS
0.29
Operating cash flow
$17.86M
Free cash flow
$14.30M
Fetching…
Sources
Revenue
—
Net income
$1.50M
Diluted EPS
0.14
Operating cash flow
$-10.44M
Free cash flow
$-13.40M
Fetching…
Sources
Revenue
—
Net income
$2.42M
Diluted EPS
0.22
Operating cash flow
$22.17M
Free cash flow
$19.80M
Fetching…
Sources
Revenue
—
Net income
$4.35M
Diluted EPS
0.40
Operating cash flow
$29.18M
Free cash flow
$26.37M
Fetching…
Sources
Revenue
—
Net income
$2.88M
Diluted EPS
0.27
Operating cash flow
$10.40M
Free cash flow
$7.73M
Fetching…
Sources
Revenue
—
Net income
$-2.11M
Diluted EPS
-0.20
Operating cash flow
$-26.14M
Free cash flow
$-28.71M
Fetching…
Sources
Revenue
—
Net income
$-242.00K
Diluted EPS
-0.04
Operating cash flow
$24.29M
Free cash flow
$22.33M
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Sources
Revenue
—
Net income
$35.91M
Diluted EPS
3.27
Operating cash flow
$25.16M
Free cash flow
$21.68M
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Sources
Is it cheap or expensive?
Fair value $36.82 vs current price $34.43
Wall Street consensus is the average analyst price target: $44.00 (19.5% higher than our fair-value estimate).
Our most-likely fair value is $36.82 a share — about 7.0% away from today's price of $34.43, so the stock currently looks fairly priced.
Is it drowning in debt?
Watch
Net debt $64.5M. Interest coverage 4.5x.
Net debt
$64.54M
Interest coverage
4.48x
L.B. Foster Company's profit covers its interest bill about 4.5 times over. which is stronger than most peers shown here.
Watch
Worse cushion
Baseline
Better cushion
FSTR
BASELINE
L.B. Foster Company
Total debt $70.32M Interest coverage 4.48x This is the baseline the peer rows are being compared against.
Total debt $144.92M Interest coverage 1.93x -57% vs FSTR Carries about 2.3x less debt cushion than FSTR.
Total debt $1.88B Interest coverage 4.34x -3% vs FSTR Has roughly the same debt cushion as FSTR.
Total debt $6.94B Interest coverage 7.97x +78% vs FSTR Carries about 1.8x more debt cushion than FSTR.
Total debt $5.37B Interest coverage 1.31x -71% vs FSTR Carries about 3.4x less debt cushion than FSTR.
What you should know
The case for and against FSTR
2 Rewards
0 Risks
Rewards
-
Returns 6.4% on equity, ahead of 25% of its peers.
-
Free cash flow was positive in 8/10 years.
Risks
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
32.48x
Forward P/E
17.00x
P/B
2.01x
P/S
0.65x
EV/EBITDA
10.52x
PEG ratio
0.44x
Profitability
How much profit each dollar creates
Gross margin
21.9%
Operating margin
6.3%
Net margin
2.0%
ROE
6.4%
ROA
5.3%
Health
Liquidity and balance-sheet strength
Debt / equity
0.39x
Current ratio
2.00x
Quick ratio
1.05x
Total debt
$70.32M
Total cash
$5.78M
Growth
How the business has been compounding
Revenue TTM
$626.97M
Revenue 5Y CAGR
-27.9%
EPS TTM
1.06
EPS 5Y CAGR
—
Cash flow
How much cash the business throws off
Operating CF TTM
$58.77M
Free CF TTM
$25.20M
FCF margin
4.0%
Dividend
Shareholder payout
Yield
0.0%
Payout ratio
0.0%
Last ex-div date
2016-09-07