Fastenal Company (NASDAQ: FAST)
Shares of Fastenal Company soared as much as 7% early Wednesday after the company announced higher earnings for the second quarter than Wall Street had anticipated.
The earnings report comes only a few days after Fastenal revealed plans to construct a 90,000-square-foot office building in its hometown of Winona.
The new office complex is expected to create room for hundreds of employees.
FAST Earnings & Outlook
The company posted earnings of $211.2 million, or $0.74 per share, ahead of analyst estimate of $0.66.
In the second quarter of the previous year, the construction and industrial supplies wholesale distributor reported earnings of $148.9 million, or $0.52 per share.
Total revenue in the second quarter of 2018 was $1.27 billion, beating consensus estimate of $1.26 billion.
Fastenal said believes the combined effects of the new tax law benefited its earnings per share by approximately by 15 cents in the three months ended May 31, 2018.
Fastenal Company Comments
Fastenal Chief Executive Officer Dan Florness told analysts in the company’s earnings conference call that it accomplished its goals in each month except January.
“Non-residential construction sales accelerated while manufacturing demand was stable at healthy levels. This contributed to 2Q18 sales growth of 13.1%, a fifth straight quarter of double-digit growth. 2Q18 operating income grew 13.3%. Reported EPS were $0.74; however, a discrete tax item added $0.04 in 2Q18. Beyond the discrete items, we estimate Tax Reform added $0.11 to EPS in 2Q18. Onsite and vending signings are on pace to achieve our 2018 targets. We achieved significant operating cost leverage in the period, including employee-related expenses. Lower gross margin partly reflects a difficult comparison, but also a continued challenging price/cost landscape.”
Fastenal Company Profile
Fastenal Company is involved in the wholesale distribution of construction and industrial supplies in the US, Canada, and worldwide. It provides company-branded fasteners, as well as other construction and industrial supplies.
The fastener products offered by the company include threaded fasteners, like screws, nuts, studs, bolts and related washers that are used in construction projects and manufactured products, as well as in the repair and maintenance of machines.
The company also provides miscellaneous hardware and supplies, including various machinery keys and pins, wire ropes, concrete anchors, strut products, rivets, metal framing systems and related accessories.
It serves the manufacturing market consisting of repair, maintenance, and operations; original equipment manufacturers; non-residential construction market that includes electrical, general, sheet metal, road contractors, and plumbing.
Fastenal also serves mining, farmers, schools, truckers, mining companies, retail trades and railroads; and oil refinement, production, and exploration companies, as well as local, state, and federal government entities.
The company was founded in 1967 by Stephen M. Slaggie, Michael M. Gostomski, John D. Remick, Robert A. Kierlin, and Henry K. McCannonis. Its headquarters are located in Winona, Minnesota. –Reuters