As the Q2 earnings season wraps, let’s dig into this quarter’s best and worst performers in the maintenance and repair distributors industry, including DXP (NASDAQ:DXPE) and its peers.
Supply chain and inventory management are themes that grew in focus after COVID wreaked havoc on the global movement of raw materials and components. Maintenance and repair distributors that boast reliable selection and quickly deliver products to customers can benefit from this theme. While e-commerce hasn’t disrupted industrial distribution as much as consumer retail, it is still a real threat, forcing investment in omnichannel capabilities to serve customers everywhere. Additionally, maintenance and repair distributors are at the whim of economic cycles that impact the capital spending and construction projects that can juice demand.
The 8 maintenance and repair distributors stocks we track reported a mixed Q2. As a group, revenues were in line with analysts’ consensus estimates.
Stocks, especially growth stocks with cash flows further into the future, had a good end of 2023. On the other hand, this year has seen more volatile stock market swings due to mixed inflation data, and while some maintenance and repair distributors stocks have fared somewhat better than others, they have collectively declined. On average, share prices are down 1.1% since the latest earnings results.
Best Q2: DXP (NASDAQ:DXPE) Founded during the emergence of Big Oil in Texas, DXP (NASDAQ:DXPE) provides pumps, valves, and other industrial components.
DXP reported revenues of $445.6 million, up 4.1% year on year. This print exceeded analysts’ expectations by 2.7%. Overall, it was a stunning quarter for the company with an impressive beat of analysts’ earnings estimates.
David R. Little, Chairman and Chief Executive Officer commented, "Second quarter results reflect the execution of our growth strategy and the resilience and durability of DXP’s business.”
DXP scored the biggest analyst estimates beat of the whole group. Unsurprisingly, the stock is up 6.7% since reporting and currently trades at $50.98.
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Fastenal (NASDAQ:FAST) Founded in 1967, Fastenal (NASDAQ:FAST) provides industrial and construction supplies, including fasteners, tools, safety products, and many other product categories to businesses globally.
Fastenal reported revenues of $1.92 billion, up 1.8% year on year, in line with analysts’ expectations. It performed better than its peers, but it was unfortunately a mixed quarter for the company with a narrow beat of analysts’ earnings estimates.
The market seems content with the results as the stock is up 4.1% since reporting. It currently trades at $66.81.
Weakest Q2: WESCO (NYSE:WCC) Based in Pittsburgh, WESCO (NYSE:WCC) provides electrical, industrial, and communications products and augments them with services such as supply chain management.
WESCO reported revenues of $5.48 billion, down 4.6% year on year, falling short of analysts’ expectations by 1.5%. It was a weak quarter for the company with a miss of analysts’ earnings and organic revenue estimates.
As expected, the stock is down 9.2% since the results and currently trades at $158.85.
MSC Industrial (NYSE:MSM) Founded in NYC’s Little Italy, MSC Industrial Direct (NYSE:MSM) provides industrial supplies and equipment, offering vast and reliable selection for customers such as contractors
MSC Industrial reported revenues of $979.4 million, down 7.1% year on year, in line with analysts’ expectations. Overall, it was a mixed quarter for the company with a narrow beat of analysts’ earnings estimates.
MSC Industrial had the slowest revenue growth among its peers. The stock is up 3.5% since reporting and currently trades at $80.93.
Transcat (NASDAQ:TRNS) Serving the pharmaceutical, industrial manufacturing, energy, and chemical process industries, Transcat (NASDAQ:TRNS) provides measurement instruments and supplies.
Transcat reported revenues of $66.71 million, up 10.1% year on year, falling short of analysts’ expectations by 3.8%. Zooming out, it was a mixed quarter for the company with an impressive beat of analysts’ earnings estimates.
Transcat had the weakest performance against analyst estimates among its peers. The stock is down 9.3% since reporting and currently trades at $122.57.
This content was originally published on Stock Story
