Wrapping up Q4 earnings, we look at the numbers and key takeaways for the infrastructure distributors stocks, including DistributionNOW (NYSE: DNOW) and its peers.
Focusing on narrow product categories that can lead to economies of scale, infrastructure distributors sell essential goods that often enjoy more predictable revenue streams. For example, the ongoing inspection, maintenance, and replacement of pipes and water pumps are critical to a functioning society, rendering them non-discretionary. Lately, innovation to address trends like water conservation has driven incremental sales. But like the broader industrials sector, infrastructure distributors are also at the whim of economic cycles as external factors like interest rates can greatly impact commercial and residential construction projects that drive demand for infrastructure products.
The 4 infrastructure distributors stocks we track reported a satisfactory Q4. As a group, revenues were in line with analysts’ consensus estimates.
Thankfully, share prices of the companies have been resilient as they are up 9.4% on average since the latest earnings results.
Best Q4: DistributionNOW (NYSE: DNOW)
Spun off from National Oilwell Varco, DistributionNOW (NYSE: DNOW) provides distribution and supply chain solutions for the energy and industrial end markets.
DistributionNOW reported revenues of $571 million, up 2.9% year on year. This print exceeded analysts’ expectations by 3.4%. Overall, it was an incredible quarter for the company with a solid beat of analysts’ EPS estimates and an impressive beat of analysts’ EBITDA estimates.
The stock is up 22.7% since reporting and currently trades at $17.35.
Is now the time to buy DistributionNOW? Access our full analysis of the earnings results here, it’s free.
Watsco (NYSE: WSO)
Originally a manufacturing company, Watsco (NYSE: WSO) today only distributes air conditioning, heating, and refrigeration equipment, as well as related parts and supplies.
Watsco reported revenues of $1.75 billion, up 9.4% year on year, outperforming analysts’ expectations by 5.3%. The business had an exceptional quarter with a solid beat of analysts’ same-store sales and adjusted operating income estimates.
Watsco pulled off the biggest analyst estimates beat among its peers. The market seems happy with the results as the stock is up 5.9% since reporting. It currently trades at $513.99.
Is now the time to buy Watsco? Access our full analysis of the earnings results here, it’s free.
Slowest Q4: MRC Global (NYSE: MRC)
Producing bomb casings and tracks for vehicles during WWII, MRC (NYSE: MRC) offers pipes, valves, and fitting products for various industries.
MRC Global reported revenues of $664 million, down 13.5% year on year, falling short of analysts’ expectations by 8.7%. It was a disappointing quarter as it posted a miss of analysts’ Fittings revenue estimates and a significant miss of analysts’ adjusted operating income estimates.
MRC Global delivered the weakest performance against analyst estimates and slowest revenue growth in the group. Interestingly, the stock is up 8.4% since the results and currently trades at $12.04.
Read our full analysis of MRC Global’s results here.
Core & Main (NYSE: CNM)
Formerly a division of industrial distributor HD Supply, Core & Main (NYSE: CNM) is a provider of water, wastewater, and fire protection products and services.
Core & Main reported revenues of $1.70 billion, up 17.9% year on year. This print topped analysts’ expectations by 1.7%. However, it was a slower quarter as it recorded a significant miss of analysts’ EPS estimates and a miss of analysts’ adjusted operating income estimates.
Core & Main scored the fastest revenue growth among its peers. The stock is flat since reporting and currently trades at $49.79.
Read our full, actionable report on Core & Main here, it’s free.
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