Fastenal Company (FAST - Free Report) recently released its May sales report, wherein average daily sales grew 5.2% to $29.5 million, moderating from 7.8% growth In April 2023. The metric had witnessed 17.6% growth in May 2022.
Net sales in May 2023 were $649 million, reflecting an increase of 10.2% year over year. May 2023 had 22 business days compared with 21 days in May 2022, which added 4.8% to the sales growth.
Currency fluctuations had a negative impact of 0.4% on May’s daily sales growth. Daily sales on a seasonal basis were up 0.7% compared with the company’s benchmark (historical five-year average) of 2.7%, which is 200 basis points below the company’s historical seasonal benchmark.
Shares of Fastenal lost 2.4% during the trading session on May 6 but gained 1.6% during the after-hour trading session.
End-Market Perspective, Product Lines & Customers
From an end-market perspective, manufacturing sales improved 9.7% for the month, decelerating from 22.4% growth a year ago. Non-residential construction dropped 9.5% versus a 10.7% increase reported in May 2022. The average daily sales growth rate in non-residential and manufacturing end markets also decelerated in May from the prior month.
Fastenal derives sales from Fasteners, Safety and other product lines. Fasteners witnessed a 0.6% decline in sales last month against 20% growth in the year-ago period. Safety products grew 6.8% in May 2023 compared with a rise of 15.6% a year ago. In May 2023, Other categories improved 9% compared with 16.1% increase a year ago.
Geographically, sales in the United States grew 4% (compared with 19.1% a year ago), while Canada/Mexico grew 14% (compared with 14.7%). Rest of World sales declined to 1.7% compared with a 5.8% drop registered in the year-ago period.
In terms of customer/channel, National account daily sales growth advanced 9% in May from a year ago, given the fact that 71% of the top 100 accounts and 52% of public branches are expanding. Yet, non-national accounts showed no growth year over year for the month. In the year-ago period, daily sales growth in non-national accounts was up 12% year over year.
Shares of the company have outperformed the industry this year so far. Although daily sales have moderated sequentially because of a potentially slower macro environment, we believe this Zacks Rank #2 (Buy) company is well-positioned to navigate through these challenges, given cost-control efforts and focus on e-commerce business.
The company’s industrial markets have been slowing down broadly due to reduced customer spending. Despite tough year-ago comparisons, Fastenal’s decent number of large customers, its leverage in its digital strategy, onsite/offsite mix and market share gains across its product categories are expected to drive growth.
Other Top-Ranked Stocks From the Zacks Retail and Wholesale Sector
MercadoLibre, Inc. (MELI - Free Report) : It presently sports a Zacks Rank #1 (Strong Buy). MELI has a trailing four-quarter earnings surprise of 35%, on average. Shares of MELI have gained 48.2% this past year. You can see the complete list of today’s Zacks #1 Rank stocks here
The Zacks Consensus Estimate for MELI’s 2023 sales and earnings per share (EPS) indicates a rise of 27.6% and 75%, respectively, from the year-ago period’s levels.
Abercrombie & Fitch Co. (ANF - Free Report) : It presently flaunts a Zacks Rank #1. The company has a trailing four-quarter earnings surprise of 480.6%, on average. Shares of ANF have increased 42.8% this year.
The Zacks Consensus Estimate for ANF’s 2023 sales and EPS indicates a rise of 3.4% and 660%, respectively, from the year-ago period’s levels.
Builders FirstSource (BLDR - Free Report) : It currently sports a Zacks Rank #1. The company has a trailing four-quarter earnings surprise of 68.3%, on average. Shares of BLDR have increased 91% this year.
The Zacks Consensus Estimate for BLDR’s 2023 earnings has increased to $9.62 per share from $7.21 over the past 30 days.
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Fastenal Company (FAST - Free Report) recently released its May sales report, wherein average daily sales grew 5.2% to $29.5 million, moderating from 7.8% growth In April 2023. The metric had witnessed 17.6% growth in May 2022.
Net sales in May 2023 were $649 million, reflecting an increase of 10.2% year over year. May 2023 had 22 business days compared with 21 days in May 2022, which added 4.8% to the sales growth.
Currency fluctuations had a negative impact of 0.4% on May’s daily sales growth. Daily sales on a seasonal basis were up 0.7% compared with the company’s benchmark (historical five-year average) of 2.7%, which is 200 basis points below the company’s historical seasonal benchmark.
Shares of Fastenal lost 2.4% during the trading session on May 6 but gained 1.6% during the after-hour trading session.
End-Market Perspective, Product Lines & Customers
From an end-market perspective, manufacturing sales improved 9.7% for the month, decelerating from 22.4% growth a year ago. Non-residential construction dropped 9.5% versus a 10.7% increase reported in May 2022. The average daily sales growth rate in non-residential and manufacturing end markets also decelerated in May from the prior month.
Fastenal derives sales from Fasteners, Safety and other product lines. Fasteners witnessed a 0.6% decline in sales last month against 20% growth in the year-ago period. Safety products grew 6.8% in May 2023 compared with a rise of 15.6% a year ago. In May 2023, Other categories improved 9% compared with 16.1% increase a year ago.
Geographically, sales in the United States grew 4% (compared with 19.1% a year ago), while Canada/Mexico grew 14% (compared with 14.7%). Rest of World sales declined to 1.7% compared with a 5.8% drop registered in the year-ago period.
In terms of customer/channel, National account daily sales growth advanced 9% in May from a year ago, given the fact that 71% of the top 100 accounts and 52% of public branches are expanding. Yet, non-national accounts showed no growth year over year for the month. In the year-ago period, daily sales growth in non-national accounts was up 12% year over year.
Shares of the company have outperformed the industry this year so far. Although daily sales have moderated sequentially because of a potentially slower macro environment, we believe this Zacks Rank #2 (Buy) company is well-positioned to navigate through these challenges, given cost-control efforts and focus on e-commerce business.
The company’s industrial markets have been slowing down broadly due to reduced customer spending. Despite tough year-ago comparisons, Fastenal’s decent number of large customers, its leverage in its digital strategy, onsite/offsite mix and market share gains across its product categories are expected to drive growth.
Other Top-Ranked Stocks From the Zacks Retail and Wholesale Sector
MercadoLibre, Inc. (MELI - Free Report) : It presently sports a Zacks Rank #1 (Strong Buy). MELI has a trailing four-quarter earnings surprise of 35%, on average. Shares of MELI have gained 48.2% this past year. You can see the complete list of today’s Zacks #1 Rank stocks here
The Zacks Consensus Estimate for MELI’s 2023 sales and earnings per share (EPS) indicates a rise of 27.6% and 75%, respectively, from the year-ago period’s levels.
Abercrombie & Fitch Co. (ANF - Free Report) : It presently flaunts a Zacks Rank #1. The company has a trailing four-quarter earnings surprise of 480.6%, on average. Shares of ANF have increased 42.8% this year.
The Zacks Consensus Estimate for ANF’s 2023 sales and EPS indicates a rise of 3.4% and 660%, respectively, from the year-ago period’s levels.
Builders FirstSource (BLDR - Free Report) : It currently sports a Zacks Rank #1. The company has a trailing four-quarter earnings surprise of 68.3%, on average. Shares of BLDR have increased 91% this year.
The Zacks Consensus Estimate for BLDR’s 2023 earnings has increased to $9.62 per share from $7.21 over the past 30 days.
Infrastructure Stock Boom to Sweep America
A massive push to rebuild the crumbling U.S. infrastructure will soon be underway. It’s bipartisan, urgent, and inevitable. Trillions will be spent. Fortunes will be made.
The only question is “Will you get into the right stocks early when their growth potential is greatest?”
Zacks has released a Special Report to help you do just that, and today it’s free. Discover 5 special companies that look to gain the most from construction and repair to roads, bridges, and buildings, plus cargo hauling and energy transformation on an almost unimaginable scale.
Download FREE: How To Profit From Trillions On Spending For Infrastructure >>
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