As the craze of earnings season draws to a close, here’s a look back at some of the most exciting (and some less so) results from Q1. Today, we are looking at maintenance and repair distributors stocks, starting with DXP (NASDAQ:DXPE).
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 9 maintenance and repair distributors stocks we track reported a satisfactory Q1. As a group, revenues were in line with analysts’ consensus estimates.
Thankfully, share prices of the companies have been resilient as they are up 6.6% on average since the latest earnings results.
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 $476.6 million, up 15.5% year on year. This print was in line with analysts’ expectations, but overall, it was a mixed quarter for the company with a decent beat of analysts’ EPS estimates.
David R. Little, Chairman and Chief Executive Officer commented, "First quarter results reflect the resilience and durability of DXP’s business. "
The stock is down 5.6% since reporting and currently trades at $83.82.
Is now the time to buy DXP? Access our full analysis of the earnings results here, it’s free.
Best Q1: Global Industrial (NYSE:GIC)
Formerly known as Systemax, Global Industrial (NYSE:GIC) distributes industrial and commercial products to businesses and institutions.
Global Industrial reported revenues of $321 million, flat year on year, outperforming analysts’ expectations by 4.6%. The business had an incredible quarter with an impressive beat of analysts’ EPS estimates and a solid beat of analysts’ EBITDA estimates.
Global Industrial pulled off the biggest analyst estimates beat among its peers. The market seems happy with the results as the stock is up 22.1% since reporting. It currently trades at $27.03.
Is now the time to buy Global Industrial? Access our full analysis of the earnings results here, it’s free.
Weakest Q1: Distribution Solutions (NASDAQ:DSGR)
Founded in 1952, Distribution Solutions (NASDAQ:DSGR) provides supply chain solutions and distributes industrial, safety, and maintenance products to various industries.
Distribution Solutions reported revenues of $478 million, up 14.9% year on year, falling short of analysts’ expectations by 3.8%. It was a disappointing quarter as it posted a significant miss of analysts’ EBITDA and EPS estimates.
Interestingly, the stock is up 3.9% since the results and currently trades at $27.07.
Read our full analysis of Distribution Solutions’s results here.
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 $77.13 million, up 8.8% year on year. This result topped analysts’ expectations by 1%. Overall, it was a very strong quarter as it also put up an impressive beat of analysts’ EBITDA estimates and a solid beat of analysts’ EPS estimates.
The stock is flat since reporting and currently trades at $80.27.
Read our full, actionable report on Transcat here, it’s free.
VSE Corporation (NASDAQ:VSEC)
With roots dating back to 1959 and a strategic focus on extending the life of transportation assets, VSE Corporation (NASDAQ:VSEC) provides aftermarket parts distribution and maintenance, repair, and overhaul services for aircraft and vehicle fleets in commercial and government markets.
VSE Corporation reported revenues of $256 million, up 57.7% year on year. This print missed analysts’ expectations by 6.7%. Zooming out, it was actually a very strong quarter as it produced a solid beat of analysts’ EPS estimates and an impressive beat of analysts’ EBITDA estimates.
VSE Corporation scored the fastest revenue growth but had the weakest performance against analyst estimates among its peers. The stock is up 17.1% since reporting and currently trades at $138.
Read our full, actionable report on VSE Corporation here, it’s free.
Market Update
As a result of the Fed’s rate hikes in 2022 and 2023, inflation has come down from frothy levels post-pandemic. The general rise in the price of goods and services is trending towards the Fed’s 2% goal as of late, which is good news. The higher rates that fought inflation also didn't slow economic activity enough to catalyze a recession. So far, soft landing. This, combined with recent rate cuts (half a percent in September 2024 and a quarter percent in November 2024) have led to strong stock market performance in 2024. The icing on the cake for 2024 returns was Donald Trump’s victory in the U.S. Presidential Election in early November, sending major indices to all-time highs in the week following the election. Still, debates around the health of the economy and the impact of potential tariffs and corporate tax cuts remain, leaving much uncertainty around 2025.
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