Distribution Solutions Group (DSGR) AI Stock Analysis

• Market Cap: $1.24B
• Dividend Yield: N/A
• Average Volume (3M): 64.48K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.95
• Revenue Growth: 14.46%
• EPS Growth: -588.82%
• Country: US
• Employees: 4,400
• Sector: Industrials
• Sector Strength: 72
• Industry: Industrial - Distribution
• EPS (TTM): 0.14
• Shares Outstanding: 46,227,783
• 10 Day Avg. Volume: 68,280
• 30 Day Avg. Volume: 64,479
• PEG Ratio: 10.99
• Price to Book (P/B): 2.52
• Price to Sales (P/S): 0.89
• P/FCF Ratio: 37.67
• Enterprise Value/Market Cap: 1.74
• Enterprise Value/Revenue: 1.09
• Enterprise Value/Gross Profit: 3.30
• Enterprise Value/Ebitda: 14.50
• 1Y Price Target: $41.00
• Price Target Upside: 56.55% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 2
• EPS Forecast (FY): 0.62
• Revenue Forecast (FY): $1.98B

• Rating: 51 Neutral
• Price Target: $28.00 ▲(6.91% Upside)

The overall stock score of 51 reflects a mixed outlook for Distribution Solutions Group. The most significant factor is the company's financial performance, which shows strong revenue growth but is hampered by profitability challenges. Technical analysis indicates weak momentum, and the high P/E ratio suggests overvaluation. The earnings call provided some positive insights, particularly in certain segments, but also highlighted ongoing challenges.

Positive Factors

Revenue Growth

Strong revenue growth indicates robust demand and effective market penetration, supporting long-term business expansion and stability.

Cash Flow Management

Effective cash flow management and debt reduction enhance financial flexibility, allowing for strategic investments and resilience.

EBITDA Margin Improvement

Improved EBITDA margins reflect operational efficiency and cost management, contributing to sustained profitability and competitive edge.

Negative Factors

Profitability Concerns

Low net profit margins indicate potential issues in cost control, which could hinder long-term profitability and shareholder returns.

Canadian Market Challenges

Economic and tariff uncertainties in Canada may impact revenue and margin stability, posing risks to regional operations.

Military Sales Decline

Declining military sales could affect revenue streams and market positioning, requiring strategic adjustments to mitigate impact.

Distribution Solutions Group Business Overview & Revenue Model

Company Description

Distribution Solutions Group (DSGR) is a leading provider of innovative distribution and supply chain solutions, specializing in the wholesale distribution of a diverse range of products across various sectors, including food service, healthcare, and retail. The company leverages advanced technology and logistics expertise to optimize inventory management and streamline operations for its clients, ensuring timely and efficient delivery of goods. DSGR's core offerings include procurement services, warehousing, transportation, and value-added services designed to enhance the overall supply chain experience.

How the Company Makes Money

Distribution Solutions Group generates revenue primarily through its distribution services, which include the sale of products and logistics solutions to a broad customer base. Key revenue streams include wholesale product sales, transportation and logistics fees, and value-added services such as inventory management and consulting. The company also benefits from strategic partnerships with suppliers and manufacturers, allowing it to offer competitive pricing and exclusive products. Additionally, DSGR's focus on technology-driven solutions enables it to streamline operations for clients, resulting in long-term contracts and repeat business, further bolstering its earnings.

Distribution Solutions Group Financial Statement Overview

Summary

Distribution Solutions Group exhibits a mixed financial performance. While revenue growth is consistent, profitability remains a challenge with negative net income. The balance sheet shows improved leverage, but profitability metrics like ROE are concerning. Cash flow generation is strong, with significant free cash flow growth, indicating potential for future stability if profitability issues are addressed.

Income Statement

The income statement shows a mixed performance. Revenue has grown steadily over the years, with a TTM growth rate of 2.59%. However, profitability is a concern as the company has reported negative net income in recent periods, resulting in a negative net profit margin of -0.57% in TTM. Gross profit margin remains healthy at 32.98%, but the declining trend in profitability metrics like EBIT and EBITDA margins indicates operational challenges.

Balance Sheet

The balance sheet reflects moderate financial stability. The debt-to-equity ratio has improved significantly in TTM to 0.24 from 1.30 in the previous year, indicating better leverage management. However, the return on equity remains negative at -1.74%, highlighting profitability issues. The equity ratio is stable, suggesting a balanced asset structure.

Cash Flow

Cash flow analysis reveals positive trends with a significant improvement in free cash flow growth at 131.22% in TTM. The operating cash flow to net income ratio is 0.37, indicating adequate cash generation relative to net income. However, the free cash flow to net income ratio of 0.79 suggests room for improvement in cash efficiency.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.98B	1.80B	1.57B	1.15B	417.73M	351.59M
Gross Profit	652.73M	613.77M	551.88M	390.90M	219.24M	186.54M
EBITDA	148.58M	128.99M	104.36M	82.42M	30.68M	28.14M
Net Income	-11.21M	-7.33M	-8.97M	7.41M	9.41M	15.11M
Balance Sheet
Total Assets	1.77B	1.73B	1.55B	1.22B	256.16M	256.30M
Cash, Cash Equivalents and Short-Term Investments	69.21M	66.48M	83.93M	24.55M	4.18M	28.39M
Total Debt	155.70M	831.09M	649.05M	461.97M	27.21M	10.31M
Total Liabilities	1.11B	1.09B	888.73M	652.62M	123.15M	133.88M
Stockholders Equity	653.87M	640.54M	661.60M	563.00M	133.01M	122.42M
Cash Flow
Free Cash Flow	88.43M	42.77M	77.61M	-31.13M	-2.74M	30.84M
Operating Cash Flow	112.62M	56.45M	102.29M	-11.03M	5.45M	32.53M
Investing Cash Flow	-44.76M	-229.68M	-278.52M	-126.69M	-41.19M	-3.99M
Financing Cash Flow	-61.09M	159.30M	250.41M	148.46M	10.66M	-5.77M

Distribution Solutions Group Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 26.19
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DSGR, the sentiment is Negative. The current price of 26.19 is below the 20-day moving average (MA) of 28.61, below the 50-day MA of 29.77, and below the 200-day MA of 29.05, indicating a bearish trend. The MACD of -0.76 indicates Positive momentum. The RSI at 30.12 is Neutral, neither overbought nor oversold. The STOCH value of 10.85 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for DSGR.

Distribution Solutions Group Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
WCC	74 Outperform	$12.26B	19.78	13.06%	0.69%	5.28%	1.97%
AIT	74 Outperform	$9.67B	24.67	22.10%	0.68%	4.03%	5.93%
GIC	72 Outperform	$1.08B	15.94	22.61%	2.93%	0.16%	2.99%
DXPE	70 Outperform	$1.91B	19.17	20.33%	―	13.93%	48.25%
MSM	64 Neutral	$4.84B	24.31	14.34%	3.97%	-1.35%	-22.24%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
DSGR	51 Neutral	$1.24B	―	-1.68%	―	14.46%	-588.82%

Distribution Solutions Group Corporate Events

Distribution Solutions Group Reports Strong Q3 2025 Results

Distribution Solutions Group, Inc. (DSG) is a specialty distribution company that provides high-touch, value-added distribution solutions to the maintenance, repair & operations (MRO), original equipment manufacturer (OEM), and industrial technologies markets. The company operates globally, serving a diverse range of customers with a focus on enhancing productivity and efficiency.

Distribution Solutions Group’s Mixed Sentiment in Q2 Earnings Call

The recent earnings call of Distribution Solutions Group, Inc. (DSG) painted a picture of mixed sentiment, marked by strong financial performance and strategic growth initiatives. The company reported impressive revenue increases and improvements in EBITDA margins, underscoring its robust operational capabilities. However, challenges such as the Canadian market’s struggles, declines in military sales, and revenue drops in the TestEquity Group due to tariffs and economic uncertainty were notable lowlights.

Intercontinental Exchange Reports Record Q2 2025 Results

Intercontinental Exchange, Inc. (NYSE: ICE) is a Fortune 500 company that designs, builds, and operates digital networks, providing financial technology and data services across major asset classes, including futures, equity, and options exchanges, as well as mortgage technology solutions.