Al Root
Industrial distributor Fastenal sells hundreds of thousands of products to tens of thousands of customers, offering investors a near-real-time look at the health of the industrial economy.
Things have been looking up after three consecutive months of industrial economic growth. Fastenal's first-quarter earnings report reflected the improvement.
The industrial distributor on Monday reported quarterly earnings per share of 30 cents from sales of $2.2 billion. Wall Street was looking for 30 cents and $2.2 billion. A year ago, Fastenal reported split-adjusted earnings per share of 26 cents from sales of $2 billion.
(Fastenal split its stock 2-for-1 in May).
Average daily sales volumes, a metric of overall activity, grew 12.4% in the quarter. Fastenal tends to grow faster than the overall industrial economy, slowly taking share from smaller players and expanding with new customers.
Heavy manufacturing end markets " continued to outperform" according to the company. Costs outpaced pricing, however, leading to a 0.5 percentage point decline in gross profit margins.
Overall, it's a solid report, and Fastenal said the "broader market conditions have begun to improve."
Still, Fastenal stock was down 4% at $47.21 in premarket trading, while S&P 500 and Dow Jones Industrial Average futures were off 0.6% and 0.5%, respectively, following President Donald Trump's recent announcement that the U.S. Navy would blockade the Strait of Hormuz after peace talks failed to reach a satisfactory deal over the weekend.
Geopolitical uncertainty might have something to do with the decline. So might the stock's starting point. Coming into Monday, Fastenal stock had risen 23% this and 22% over the past 12 months.
Gains left shares trading for about 39 times earnings expected over the coming 12 months, up from about 36 times a year ago. Fastenal stock typically trades for around 30 times earnings
Things are improving, but investors may have gotten a little ahead of themselves. Despite the early Monday dip, investors can console themselves that things are getting better for U.S. manufacturing.
Write to Al Root at allen.root@dowjones.com
This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.
(END) Dow Jones Newswires
April 13, 2026 07:16 ET (11:16 GMT)
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