Industrial and safety product distributor Distribution Solutions (NASDAQ:DSGR) will be reporting earnings this Thursday morning. Here’s what to look for.
Distribution Solutions beat analysts’ revenue expectations last quarter, reporting revenues of $496 million, up 3.8% year on year. It was a softer quarter for the company, with a significant miss of analysts’ EBITDA estimates and 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 for active Edge members.
This quarter, the market is expecting Distribution Solutions’s revenue to grow 3.6% year on year, slowing from the 14.3% increase it recorded in the same quarter last year.
Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business will stay the course heading into earnings. Distribution Solutions has missed Wall Street’s revenue estimates multiple times over the last two years.
Looking at Distribution Solutions’s peers in the maintenance and repair distributors segment, some have already reported their Q2 results, giving us a hint as to what we can expect. Transcat delivered year-on-year revenue growth of 21.6%, beating analysts’ expectations by 7.4%, and WESCO reported revenues up 13%, topping estimates by 3.7%. WESCO traded up 11% following the results.
Read our full analysis of Transcat’s results here and WESCO’s results here.
Investors in the maintenance and repair distributors segment have had steady hands going into earnings, with share prices flat over the last month. Distribution Solutions is up 28.4% during the same time and is heading into earnings with an average analyst price target of $35 (compared to the current share price of $34.75).
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