Why Fastenal Shares Are Sliding Today

Fastenal Company FAST reported Q2 sales growth of 5.9% Y/Y to $1.88 billion, marginally missing the consensus of $1.89 billion.

The company experienced higher unit sales on growth at the Onsite locations. 

The overall impact of product pricing on net sales in the second quarter of 2023 was 190 to 220 basis points compared to Q2 2022.

Gross profit margin contracted to 45.5% from 46.5% a year ago due to lower unfavorable customer and product mix and higher overhead expenses.

Operating margin declined to 21.0% from 21.6% a year ago.

Q2 EPS of $0.52 missed the consensus of $0.53.

Weighted FASTVend/FASTBin signings (MEUs) were 6,794, higher than 5,490 a year ago.

Fastenal's operating cash flow for the quarter was $302.1 million, compared to $151.2 million a year ago.

Total debt was $350.0 million at the end of the quarter, or 9.4% of total capital. 

It held cash and equivalents of $243.6 million as of June 30, 2023.

Dividend: Yesterday, the company declared a dividend per share of $0.35, payable on August 24, 2023, to shareholders of record as on July 27, 2023.

The company signed 86 new Onsite locations in the quarter. It now expects 350 annual signings (vs. 375 - 400 guided earlier) for 2023.

For 2023, the company's goal for weighted FASTBin and FASTVend device signings remains at 23,000 to 25,000 MEUs.

Price Action: FAST shares are trading lower by 2.93% at $57.01 premarket on the last check Thursday.