DXP Enterprises (DXPE) AI Stock Analysis

• Market Cap: $2.23B
• Dividend Yield: N/A
• Average Volume (3M): 114.32K
• Price to Earnings (P/E): 26.8
• Beta (1Y): 1.62
• Revenue Growth: 12.76%
• EPS Growth: 36.11%
• Country: US
• Employees: 3,028
• Sector: Industrials
• Sector Strength: 72
• Industry: Industrial - Distribution
• EPS (TTM): 1.39
• Shares Outstanding: 15,522,213
• 10 Day Avg. Volume: 123,498
• 30 Day Avg. Volume: 114,318
• PEG Ratio: 0.71
• Price to Book (P/B): 3.44
• Price to Sales (P/S): 0.85
• P/FCF Ratio: 31.72
• Enterprise Value/Market Cap: 1.32
• Enterprise Value/Revenue: 1.46
• Enterprise Value/Gross Profit: 4.61
• Enterprise Value/Ebitda: 13.42
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): 6.41
• Revenue Forecast (FY): $2.13B

• Rating: 75 Outperform
• Price Target: $167.00 ▲(41.56% Upside)
• Action: Reiterated Date: 02/27/26
• Date: Action: Reiterated 02/27/26

The score is driven primarily by improved fundamentals (strong growth and a notably stronger 2025 balance sheet) and supportive technical momentum. This is partially offset by a higher valuation (P/E ~29) and cash-flow/working-capital sensitivity highlighted in both the financials and the latest earnings call.

Positive Factors

Sustained Revenue Growth

DXP has demonstrated durable top-line expansion, doubling revenue from ~$1.01B in 2020 to ~$2.02B in 2025 and sustaining a ~15% CAGR since 2022. That multi-year growth across end markets supports scale, cover for fixed costs, and a larger platform for cross-sell and margin improvements over the next 2–6 months and beyond.

Material Balance Sheet Repair

A sharp reduction in leverage meaningfully improves financial flexibility and covenant headroom, enabling management's stated M&A and capital return plans. With reported cash and ABL liquidity also large, the stronger capital structure lowers refinancing risk and supports durable investment in growth initiatives.

High Returns and Margin Expansion

Strong ROIC and rising gross and EBITDA margins indicate efficient use of capital and improving unit economics. These metrics point to sustainable profitability improvements from pricing, mix and accretive M&A, providing lasting cash generation capacity and strategic optionality for reinvestment or shareholder returns.

Negative Factors

Cash‑flow & Working‑capital Sensitivity

DXP's cash conversion is inconsistent: free cash flow covered only ~57% of net income in 2025 and operating cash flow was volatile historically. Elevated working capital (up $70.7M YoY) and acquisition-driven inventory can pressure liquidity and make near-term cash generation sensitive to billing timing and end‑market cycles.

Energy Backlog & Segment Volatility

DXP retains meaningful exposure to energy and supply-chain customers whose project timing and facility activity can swing revenue cadence. Recent sequential backlog pullbacks and light bookings highlight cyclical risk that can blunt growth and margin momentum over multiple quarters until end-market demand normalizes.

Acquisition‑Driven Cost and Capital Load

Aggressive M&A and growth investments have increased SG&A, capex and absolute debt even as leverage has improved. Ongoing integration costs and higher operating spend could pressure margins and require sustained cash generation to validate the lower leverage; investors need confidence that expense increases are accretive.

DXP Enterprises Business Overview & Revenue Model

Company Description

DXP Enterprises, Inc., together with its subsidiaries, engages in distributing maintenance, repair, and operating (MRO) products, equipment, and services to the energy and industrial customers primarily in the United States and Canada. It operates through three segments: Service Centers (SC), Supply Chain Services (SCS), and Innovative Pumping Solutions (IPS). The SC segment offers MRO products, equipment, and integrated services, including technical expertise and logistics services. It offers a range of MRO products in the rotating equipment, bearing, power transmission, hose, fluid power, metal working, fastener, industrial supply, safety products, and safety services categories. This segment serves customers in the oil and gas, food and beverage, petrochemical, transportation, other general industrial, mining, construction, chemical, municipal, agriculture, and pulp and paper industries. The SCS segment manages procurement and inventory management solutions; and offers outsourced MRO solutions for sourcing MRO products, including inventory optimization and management, store room management, transaction consolidation and control, vendor oversight and procurement cost optimization, productivity improvement, and customized reporting services. Its programs include SmartAgreement, a procurement solution for various MRO categories; SmartBuy, an on-site or centralized MRO procurement solution; SmartSource, an on-site procurement and storeroom management solution; SmartStore, an e-Catalog solution; SmartVend, an industrial dispensing solution; and SmartServ, an integrated service pump solution. The IPS segment fabricates and assembles custom-made pump packages, remanufactures pumps, and manufactures branded private label pumps. The company was founded in 1908 and is based in Houston, Texas.

How the Company Makes Money

DXP Enterprises generates revenue primarily through the sale of industrial products and services. The company's revenue model is diversified across multiple segments, with key revenue streams including product sales from its Service Centers, which supply essential industrial equipment and parts, and Supply Chain Services that offer inventory management and logistics solutions. Additionally, DXP provides Innovative Pumping Solutions that encompass engineered pump systems and related services. Significant partnerships with manufacturers and suppliers enhance its product offerings and expand its market reach, contributing to consistent earnings through both direct sales and service contracts with various industrial clients.

DXP Enterprises Financial Statement Overview

Summary

Strong multi-year revenue growth and improved profitability, plus a meaningfully stronger balance sheet in 2025 with sharply lower debt-to-equity and healthy ROE. Offsets include cash-flow volatility (notably weak 2022) and mixed cash conversion in 2025, along with some margin softening/clarity issues in the income statement data.

Income Statement

Revenue has expanded meaningfully over the last several years (from ~$1.01B in 2020 to ~$2.02B in 2025), with a strong post-2020 recovery and continued growth into 2025. Profitability also improved versus earlier years, with 2025 showing solid gross margin (~31.5%) and net margin (~4.4%). Offsetting this, profitability is not fully consistent year-to-year (e.g., EBITDA margin stepped down in 2025 vs. 2023–2024), and the dataset shows an anomalous 2025 EBIT margin value (0.0) that clouds operating margin trend clarity.

Balance Sheet

The balance sheet shows a notable improvement in leverage: debt-to-equity fell sharply to ~0.17 in 2025 from ~1.5–1.6 in 2023–2024, alongside rising equity. Returns on equity are healthy and sustained (~13%–18% from 2022–2025), indicating improved earnings power on the capital base. The main caution is that leverage was elevated for several years prior to 2025, so investors would likely want confirmation that the lower debt level is durable.

Cash Flow

Cash generation is generally positive, with operating cash flow and free cash flow solid in 2023–2025 (2025 free cash flow ~$54M). However, cash flow quality is mixed: in 2025, free cash flow covers only ~57% of net income, and operating cash flow relative to net income is modest based on the provided coverage figure. Volatility is also evident—2022 saw very weak operating and free cash flow before rebounding sharply in 2023—suggesting working-capital or cycle sensitivity.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Mar 2023	Dec 2021
Income Statement
Total Revenue	2.02B	1.80B	1.68B	1.48B	1.11B
Gross Profit	635.93M	556.28M	505.29M	422.04M	328.51M
EBITDA	218.60M	182.30M	170.18M	123.54M	67.41M
Net Income	88.68M	70.49M	68.81M	48.16M	16.50M
Balance Sheet
Total Assets	1.69B	1.35B	1.18B	1.04B	906.19M
Cash, Cash Equivalents and Short-Term Investments	303.78M	148.32M	173.12M	46.03M	48.99M
Total Debt	982.00M	676.36M	575.97M	471.85M	376.82M
Total Liabilities	1.19B	926.71M	796.56M	671.89M	547.50M
Stockholders Equity	498.44M	422.79M	380.88M	365.39M	358.64M
Cash Flow
Free Cash Flow	53.98M	77.14M	93.96M	978.00K	31.09M
Operating Cash Flow	94.26M	102.21M	106.22M	5.89M	37.09M
Investing Cash Flow	-99.25M	-181.69M	-22.65M	-53.42M	-69.02M
Financing Cash Flow	158.87M	56.80M	43.58M	44.31M	-38.49M

DXP Enterprises Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 117.97
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DXPE, the sentiment is Neutral. The current price of 117.97 is below the 20-day moving average (MA) of 146.43, below the 50-day MA of 129.03, and above the 200-day MA of 110.59, indicating a neutral trend. The MACD of 5.27 indicates Positive momentum. The RSI at 52.71 is Neutral, neither overbought nor oversold. The STOCH value of 19.29 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for DXPE.

DXP Enterprises Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
GIC	76 Outperform	$1.29B	17.76	23.99%	3.48%	0.16%	2.99%
DXPE	75 Outperform	$2.23B	26.76	19.25%	―	12.76%	36.11%
AIT	72 Outperform	$10.58B	26.89	22.02%	0.70%	4.03%	5.93%
MSM	66 Neutral	$5.25B	25.64	14.84%	3.96%	-1.35%	-22.24%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
DSGR	61 Neutral	$1.39B	-125.17	-1.68%	―	14.46%	-588.82%
EVI	57 Neutral	$260.84M	43.51	3.77%	―	12.63%	-21.23%

DXP Enterprises Corporate Events

DXP Enterprises Refinances Term Loan to Support Growth

On December 16, 2025, DXP Enterprises, Inc. amended its term loan facility, ultimately refinancing its existing Senior Secured Term Loan B borrowings and raising an incremental $205 million, bringing total Term Loan B debt to $848 million at a reduced margin of 3.25 percentage points over Term SOFR and extending maturity to October 13, 2030. Announced on December 22, 2025, the transaction leaves DXP with $285 million of cash on the balance sheet, is expected to generate interest cost savings, and provides enhanced liquidity and covenant headroom to support its accelerating acquisition strategy and broader growth plans, with management highlighting strong multi-year improvements in sales and EBITDA and a pro forma net debt-to-EBITDA ratio of 2.8x at the end of the third quarter.

The most recent analyst rating on (DXPE) stock is a Buy with a $111.00 price target. To see the full list of analyst forecasts on DXP Enterprises stock, see the DXPE Stock Forecast page.