Looking back on maintenance and repair distributors stocks’ Q2 earnings, we examine this quarter’s best and worst performers, including W.W. Grainger (NYSE:GWW) 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 9 maintenance and repair distributors stocks we track reported a very strong Q2. As a group, revenues beat analysts’ consensus estimates by 2%.
Luckily, maintenance and repair distributors stocks have performed well with share prices up 13.6% on average since the latest earnings results.
Weakest Q2: W.W. Grainger (NYSE:GWW)
Founded as a supplier of motors, W.W. Grainger (NYSE:GWW) provides maintenance, repair, and operating (MRO) supplies and services to businesses and institutions.
W.W. Grainger reported revenues of $4.55 billion, up 5.6% year on year. This print exceeded analysts’ expectations by 0.6%. Despite the top-line beat, it was still a slower quarter for the company with full-year EPS guidance slightly missing analysts’ expectations and a miss of analysts’ EPS estimates.
"Our team remains focused on our customers, fostering deep relationships, providing exceptional service and driving innovation through differentiated capabilities," said D.G. Macpherson, Chairman and CEO.
Unsurprisingly, the stock is down 2.5% since reporting and currently trades at $1,013.
Is now the time to buy W.W. Grainger? Access our full analysis of the earnings results here, it’s free.
Best Q2: 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 $76.42 million, up 14.6% year on year, outperforming analysts’ expectations by 5.7%. The business had an incredible quarter with a beat of analysts’ EPS estimates and an impressive beat of analysts’ EBITDA estimates.
Transcat pulled off the biggest analyst estimates beat among its peers. The market seems happy with the results as the stock is up 16.3% since reporting. It currently trades at $91.20.
Is now the time to buy Transcat? Access our full analysis of the earnings results here, it’s free.
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 $5.9 billion, up 7.7% year on year, exceeding analysts’ expectations by 1.6%. Still, it was a mixed quarter as it posted a miss of analysts’ adjusted operating income estimates.
Interestingly, the stock is up 5.8% since the results and currently trades at $224.48.
Read our full analysis of WESCO’s results here.
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 $272.1 million, up 41.1% year on year. This number topped analysts’ expectations by 3.4%. Overall, it was an incredible quarter as it also put up a beat of analysts’ EPS estimates and a solid beat of analysts’ EBITDA estimates.
VSE Corporation delivered the fastest revenue growth among its peers. The stock is up 17.1% since reporting and currently trades at $165.56.
Read our full, actionable report on VSE Corporation here, it’s free.
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 $358.9 million, up 3.2% year on year. This print beat analysts’ expectations by 2%. It was a stunning quarter as it also recorded a beat of analysts’ EPS estimates and a solid beat of analysts’ EBITDA estimates.
The stock is up 36.8% since reporting and currently trades at $37.10.
Read our full, actionable report on Global Industrial 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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