FSTRL.B. Foster Company
Is the business good?
A genuinely good business: earnings fully cash-backed (4.4×) and margins widening.
Operating profit is fully backed by cash. Conversion is improving vs a year ago.
Positive operating leverage, operating profit is growing faster than sales, so margins widen as the business scales.
A balanced mix of margins, efficiency, and leverage. ROE 5% = margin × turnover × leverage.
Unless marked, from derived.
Where this answer is blind. The F-score rewards improvement, so an already-elite company can score mid-pack.
How good a business is FSTR?
L.B. Foster Company earns 8.7% on the capital it employs against a 9.0% cost of capital, so growth costs more than it returns.
Return on invested capital · cost of capital 9.0% · 0.27 points below what the capital costs: growth destroys value
- Operating margin
- 4.4%
Operating margin · Railroads median 33% · 12 months to Q2 2026
- Cash conversion
- 4.43×
Cash conversion · 2.61× a year ago · operating cash flow covers the operating profit after tax
- Share count, year on year
- −2.3%
Share count, year on year · bought back, each share owns more of the company
| Year | Operating margin |
|---|---|
| FY2020 | 3.1% |
| FY2021 | 0.87% |
| FY2022 | −1.5% |
| FY2023 | 1.7% |
| FY2024 | 3.9% |
| FY2025 | 4.0% |
Details›
- Gross margin12 months to Q2 2026
- 21%
- Operating margin12 months to Q2 2026
- 4.4%
- Net margin12 months to Q2 2026
- 2.0%
- Free cash flow margin
- 8.4%
- Revenue, trailing twelve months
- $558M
- Free cash flow, trailing twelve months
- $47M
- Net income, trailing twelve months
- $11M
- Return on invested capitaloperating profit after tax ÷ debt + equity − cash
- 8.7%
Margins, capital and share counts from the statements as filed with the SEC; cash conversion is operating cash flow over operating profit after tax.