Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified MSC Industrial Direct ( MSM) as a new lifetime high candidate. In addition to specific proprietary factors, Trade-Ideas identified MSC Industrial Direct as such a stock due to the following factors:

  • MSM has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $41.9 million.
  • MSM has traded 8,392 shares today.
  • MSM is trading at a new lifetime high.

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More details on MSM:

MSC Industrial Direct Co., Inc., together with its subsidiaries, markets and distributes metalworking, and maintenance, repair, and operations (MRO) supplies primarily in the United States. The stock currently has a dividend yield of 1.5%. MSM has a PE ratio of 24.0. Currently there are 6 analysts that rate MSC Industrial Direct a buy, no analysts rate it a sell, and 5 rate it a hold.

The average volume for MSC Industrial Direct has been 464,100 shares per day over the past 30 days. MSC Industrial Direct has a market cap of $4.2 billion and is part of the services sector and wholesale industry. The stock has a beta of 0.91 and a short float of 11% with 10.37 days to cover. Shares are up 6.1% year-to-date as of the close of trading on Monday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates MSC Industrial Direct as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, expanding profit margins, good cash flow from operations and increase in stock price during the past year. We feel these strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from the ratings report include:
  • The revenue growth came in higher than the industry average of 6.4%. Since the same quarter one year prior, revenues rose by 17.5%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • MSM's debt-to-equity ratio is very low at 0.24 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.37, which illustrates the ability to avoid short-term cash problems.
  • 48.77% is the gross profit margin for MSC INDUSTRIAL DIRECT which we consider to be strong. It has increased from the same quarter the previous year. Along with this, the net profit margin of 8.70% is above that of the industry average.
  • Net operating cash flow has increased to $104.38 million or 16.79% when compared to the same quarter last year. In addition, MSC INDUSTRIAL DIRECT has also modestly surpassed the industry average cash flow growth rate of 12.08%.
  • Compared to where it was 12 months ago, the stock is up, but it has so far lagged the appreciation in the S&P 500. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

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