By Abhinav Parmar
-Fastenal beat estimates for third-quarter profit on Thursday, driven by higher demand for its onsite products such as, safety gloves, fasteners and power tools, sending its shares up more than 7% in morning trading.
Demand for onsite industrial supplies from construction companies remained hot during the quarter as clients geared up to quickly complete projects.
The Winona, Minnesota-based nuts and bolts distributor reported a net income of 52 cents per share for the quarter ended Sept. 30, beating analysts' estimates of 50 cents per share, as per LSEG data.
"We expected September to come in ahead of July levels and consensus expectations but results were ahead of our model, a positive indicator of US industrial momentum into September," UBS analyst Chris Snyder said.
Fasteners, one of the core segments of the wholesale distributor, saw its sales fall to 32.1% of the company's total sales, compared with 34.1% in the year earlier. Whereas, the heavy manufacturing segment contributed 43.2%, compared with 41.3%, a year earlier.
"We experienced higher unit sales in the third quarter of 2023 that was primarily due to growth at our onsite locations, particularly those opened in the last two years," Fastenal (NASDAQ:FAST) said.
Its total quarterly revenue came in at $1.84 billion, up 2.4% from a year earlier. Analysts on average were expecting revenue of $1.85 billion in the third quarter.