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Q1 Earnings Outperformers: W.W. Grainger (NYSE:GWW) And The Rest Of The Maintenance and Repair Distributors Stocks


Max Juang /
2024/06/14 4:10 am EDT

Earnings results often indicate what direction a company will take in the months ahead. With Q1 now behind us, let’s have a look at 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 4 maintenance and repair distributors stocks we track reported a weak Q1; on average, revenues missed analyst consensus estimates by 0.6%. Inflation progressed towards the Fed's 2% goal at the end of 2023, leading to strong stock market performance. The start of 2024 has been a bumpier ride, as the market switches between optimism and pessimism around rate cuts due to mixed inflation data, and maintenance and repair distributors stocks have had a rough stretch, with share prices down 8.1% on average since the previous earnings results.

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 $4.24 billion, up 3.5% year on year, falling short of analysts' expectations by 0.5%. It was a slower quarter for the company, with a miss of analysts' revenue and EPS estimates.

"Our 2024 performance so far shows that the team is focusing on what matters and living our purpose—We Keep the World Working®. We've produced solid results amidst a slow, but steady demand environment," said D.G. Macpherson, Chairman and CEO.

W.W. Grainger Total Revenue

W.W. Grainger scored the fastest revenue growth of the whole group. The stock is down 6.1% since the results and currently trades at $900.

Is now the time to buy W.W. Grainger? Access our full analysis of the earnings results here, it's free.

Best Q1: 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 $1.90 billion, up 1.9% year on year, falling short of analysts' expectations by 1%. It was a mixed quarter for the company, with a miss of analysts' earnings and operating margin estimates. On the other hand, Fastenal blew past analysts' volume expectations.

Fastenal Total Revenue

The stock is down 15.9% since the results and currently trades at $62.86.

Is now the time to buy Fastenal? Access our full analysis of the earnings results here, it's free.

Weakest Q1: 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 $935.3 million, down 2.7% year on year, falling short of analysts' expectations by 1.6%. It was a weak quarter for the company, with a miss of analysts' operating margin and organic revenue estimates.

MSC Industrial had the weakest performance against analyst estimates in the group. The stock is down 23.6% since the results and currently trades at $76.

Read our full analysis of MSC Industrial's results here.

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 $5.35 billion, down 3.1% year on year, in line with analysts' expectations. It was a mixed quarter for the company, with a miss of analysts' earnings estimates.

WESCO pulled off the biggest analyst estimates beat but had the slowest revenue growth among its peers. The stock is up 13.1% since the results and currently trades at $174.63.

Read our full, actionable report on WESCO here, it's free.

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