Industrial and safety product distributor Distribution Solutions (NASDAQ:DSGR) will be reporting earnings tomorrow morning. Here’s what investors should know.
Distribution Solutions beat analysts’ revenue expectations by 1.2% last quarter, reporting revenues of $468 million, up 6.6% year on year. It was a mixed quarter for the company, with a solid beat of analysts’ EBITDA estimates but a significant miss of analysts’ EPS estimates.
Is Distribution Solutions a buy or sell going into earnings? Read our full analysis here, it’s free.
This quarter, analysts are expecting Distribution Solutions’s revenue to grow 14.5% year on year to $463.8 million, slowing from the 23.2% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $0.33 per share.
Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. Distribution Solutions has missed Wall Street’s revenue estimates three times over the last two years.
Looking at Distribution Solutions’s peers in the maintenance and repair distributors segment, some have already reported their Q4 results, giving us a hint as to what we can expect. Global Industrial’s revenues decreased 5.6% year on year, missing analysts’ expectations by 1.2%, and WESCO reported flat revenue, topping estimates by 1.5%. Global Industrial’s stock price was unchanged after the results, while WESCO was up 4.4%.
Read our full analysis of Global Industrial’s results here and WESCO’s results here.
Inflation has progressed towards the Fed’s 2% goal as of late, leading to strong stock market performance. Recent rate cuts and the 2024 Presidential election's conclusion added further sparks to the market, and while some of the maintenance and repair distributors stocks have shown solid performance, the group has generally underperformed, with share prices down 9.7% on average over the last month. Distribution Solutions is down 10.8% during the same time and is heading into earnings with an average analyst price target of $43 (compared to the current share price of $28.18).
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