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Fastenal Company (FAST)
NASDAQ:FAST
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Fastenal Company
(NASDAQ:FAST)
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Select Model
Rating:71Outperform
Price Target:
$47.00
â–²(10.69% Upside)
Fastenal Company scores well due to its strong financial performance and positive earnings call sentiment, highlighting significant growth and strategic initiatives. However, technical analysis indicates bearish momentum, and the high P/E ratio suggests potential overvaluation, which tempers the overall score.
Positive Factors
Revenue Growth
Achieving record revenue with significant sales growth indicates strong market demand and effective sales strategies, supporting long-term business expansion.
Digital Sales Expansion
The growth in digital sales reflects Fastenal's successful adaptation to digital trends, enhancing its competitive edge and customer reach in the long term.
Contract Customer Sales
Increased reliance on contract sales strengthens customer relationships and revenue predictability, providing a stable foundation for future growth.
Negative Factors
Sluggish Market Conditions
Persistent sluggish market conditions could hinder growth potential and affect demand, challenging Fastenal's ability to sustain its recent performance.
Inventory and Tariff Challenges
Rising inventory and tariff-related costs may pressure margins and necessitate pricing adjustments, impacting profitability and operational efficiency.
FMI Technology Slowdown
A slowdown in FMI Technology installations could limit Fastenal's technological advancement and differentiation, affecting its competitive positioning.
Fastenal Company (FAST) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$48.15B
Dividend Yield2.03%
Average Volume (3M)6.94M
Price to Earnings (P/E)39.3
Beta (1Y)0.78
Revenue Growth6.92%
EPS Growth5.98%
CountryUS
Employees21,339
SectorIndustrials
Sector Strength72
IndustryIndustrial - Distribution
Share Statistics
EPS (TTM)0.29
Shares Outstanding1,147,636,600
10 Day Avg. Volume8,044,237
30 Day Avg. Volume6,943,005
Financial Highlights & Ratios
PEG Ratio-36.16
Price to Book (P/B)11.39
Price to Sales (P/S)5.46
P/FCF Ratio43.50
Enterprise Value/Market Cap1.18
Enterprise Value/Revenue5.82
Enterprise Value/Gross Profit12.92
Enterprise Value/Ebitda26.47
Forecast
1Y Price Target
$46.50Price Target Upside9.51% Upside
Rating ConsensusHold
Number of Analyst Covering10
Fastenal Company Business Overview & Revenue Model
Company DescriptionFastenal Company (FAST) is a leading distributor of industrial and construction supplies, specializing in fasteners, tools, and safety products. Founded in 1967 and headquartered in Winona, Minnesota, the company operates in various sectors including manufacturing, construction, and maintenance, repair, and operations (MRO). Fastenal offers a wide range of products, including nuts, bolts, screws, and other fastening systems, as well as inventory management solutions and supply chain services to help businesses streamline their operations.
How the Company Makes MoneyFastenal generates revenue primarily through the sale of its industrial and construction supplies to businesses across various sectors. The company's revenue model is predominantly based on direct sales through its extensive network of retail locations and online platforms. Key revenue streams include the sale of fasteners, tools, safety equipment, and other related products, along with value-added services such as inventory management and vending solutions. Fastenal also benefits from long-term relationships with suppliers and customers, allowing for bulk purchasing and competitive pricing. Additionally, the company has established partnerships with various manufacturers, enhancing its product offerings and enabling it to meet the diverse needs of its clientele.
Fastenal Company Earnings Call Summary
Earnings Call Date:Oct 13, 2025
(Q3-2025)
| % Change Since: |
Next Earnings Date:Jan 19, 2026
Earnings Call Sentiment Positive
The earnings call reflected a positive sentiment with significant revenue growth, margin expansion, and progress in digital and on-site sales. However, challenges remain in pricing and cost management, which could affect future profitability.Q3-2025 Updates
Positive Updates
Record-Breaking Revenue and Growth
In Q3 2025, Fastenal achieved net sales of $2.13 billion, marking an 11.7% increase over the previous year. This was the second consecutive quarter above the $2 billion mark, showcasing the effectiveness of their strategy and customer partnerships.
Significant Sales and Margin Expansion
The company reported a 12.6% increase in net income and a 12.3% rise in EPS. Operating margin expanded to 20.7%, with gross margin increasing to 45.3%, driven by fastener expansion and supplier initiatives.
Digital and On-Site Growth
Sales through FMI technology grew just shy of 18% year over year, with digital sales accounting for 61.3% of Q3 total sales. The company also saw strong growth in nontraditional markets, including healthcare, education, and government.
Strong Performance in National Accounts
National account sales were up double digits, with significant gains in customer penetration. Sites spending over $50,000 per month grew by 15.4%.
Negative Updates
Pricing Challenges and Uncertainty
Pricing contributed less to growth than anticipated, with a contribution of 2.5 percentage points, below the earlier forecast of 3% to 5%. The company cited delays and complexities in implementing pricing actions due to tariff uncertainties.
Potential for Margin Squeeze
Fourth quarter gross margin might face pressure due to rising costs and delayed pricing actions, potentially leading to a margin squeeze.
SG&A Expense Growth
SG&A grew at 11% year over year due to bonus resets and increased employee-related expenses, indicating cost management challenges.
Company Guidance
During the Fastenal Company 2025 Q3 earnings call, significant growth metrics were highlighted. The company achieved net sales of $2.13 billion, marking an 11.7% increase compared to Q3 of the previous year, with daily sales growth of 11.2% and year-to-date sales up 15.9%. Fastenal experienced double-digit growth in national account sales and saw substantial increases in active customer sites spending over $10,000 and $50,000 monthly, growing by 8.1% and 15.4%, respectively. The company maintained a gross margin of 45.3%, up 40 basis points year-over-year, and reported a net income increase of 12.6%, with earnings per share (EPS) rising by 12.3%. Despite challenges such as tariff impacts and sluggish market demand, Fastenal's strategic initiatives, including fastener expansion and digital integration, contributed to a 20.7% operating margin. The company's digital footprint also expanded, with technology-driven sales accounting for 61.3% of total sales.Fastenal Company Financial Statement Overview
Summary
Fastenal Company exhibits strong financial health with consistent revenue and income growth, robust profitability margins, and a solid balance sheet with conservative leverage. The company's strong cash flow generation further supports its financial stability, making it well-positioned in the Industrial - Distribution industry. While growth rates are moderate, the overall financial metrics indicate a stable and profitable company with a strong foundation for future expansion.Income Statement
Fastenal Company demonstrates strong income statement metrics with consistent revenue growth and profitability. The TTM shows a gross profit margin of 45.06%, net profit margin of 15.30%, EBIT margin of 20.10%, and EBITDA margin of 21.21%. The revenue growth rate from 2024 to TTM is 3.03%, indicating steady growth. The company maintains healthy margins, reflecting efficient operations and profit generation.88
Very Positive
Balance Sheet
The balance sheet reflects a strong equity base with a debt-to-equity ratio of 0.14, indicating conservative leverage. The return on equity (ROE) is robust at 31.22%, showcasing effective use of shareholder funds. The equity ratio is high at 75.90%, pointing to a solid financial structure with a focus on equity financing, which minimizes financial risk.80
Positive
Cash Flow
Fastenal Company's cash flow statement is impressive, with a free cash flow to net income ratio of 0.74, highlighting efficient cash utilization. The operating cash flow to net income ratio is 0.94, demonstrating strong cash generation relative to net income. Although the free cash flow growth rate has fluctuated, the company maintains a solid cash position to support operations and growth.85
Very Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 9.73B | 7.55B | 7.35B | 6.98B | 6.01B | 5.65B |
| Gross Profit | 4.39B | 3.40B | 3.35B | 3.22B | 2.78B | 2.57B |
| EBITDA | 2.14B | 1.69B | 1.71B | 1.63B | 1.39B | 1.30B |
| Net Income | 1.49B | 1.15B | 1.16B | 1.09B | 925.00M | 859.10M |
Balance Sheet | ||||||
| Total Assets | 5.02B | 4.70B | 4.46B | 4.55B | 4.30B | 3.96B |
| Cash, Cash Equivalents and Short-Term Investments | 237.80M | 255.80M | 221.30M | 230.10M | 236.20M | 245.70M |
| Total Debt | 545.20M | 485.40M | 535.00M | 802.10M | 636.80M | 650.10M |
| Total Liabilities | 1.21B | 1.08B | 1.11B | 1.39B | 1.26B | 1.23B |
| Stockholders Equity | 3.81B | 3.62B | 3.35B | 3.16B | 3.04B | 2.73B |
Cash Flow | ||||||
| Free Cash Flow | 875.90M | 946.80M | 1.26B | 767.20M | 613.50M | 933.70M |
| Operating Cash Flow | 1.12B | 1.17B | 1.43B | 941.00M | 770.10M | 1.10B |
| Investing Cash Flow | -231.60M | -214.50M | -161.20M | -163.00M | -148.50M | -281.70M |
| Financing Cash Flow | -912.70M | -913.70M | -1.28B | -774.90M | -627.10M | -754.40M |
Fastenal Company Technical Analysis
Negative
42.46
Price Trends
47.80
Negative
45.64
Negative
41.84
Positive
Market Momentum
-1.47
Positive
27.87
Positive
11.21
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For FAST, the sentiment is Negative. The current price of 42.46 is below the 20-day moving average (MA) of 46.39, below the 50-day MA of 47.80, and above the 200-day MA of 41.84, indicating a neutral trend. The MACD of -1.47 indicates Positive momentum. The RSI at 27.87 is Positive, neither overbought nor oversold. The STOCH value of 11.21 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for FAST.
Fastenal Company Risk Analysis
Fastenal Company disclosed 33 risk factors in its most recent earnings report. Fastenal Company reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Fastenal Company Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | $10.63B | 17.10 | 13.78% | 0.81% | 1.30% | -1.09% | |
75 Outperform | $4.76B | 24.10 | 14.34% | 3.98% | -4.11% | -31.26% | |
71 Outperform | $48.15B | 39.34 | 32.74% | 2.03% | 6.92% | 5.98% | |
70 Outperform | $45.66B | 24.09 | 55.30% | 0.90% | 4.35% | 7.84% | |
69 Neutral | $9.24B | 24.18 | 22.24% | 0.71% | 1.88% | 2.91% | |
64 Neutral | $18.61B | 23.04 | 17.50% | 3.07% | 2.65% | -32.91% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% |
* Industrials Sector Average
FAST
Fastenal Company
42.46
4.32
11.33%
AIT
Applied Industrial Technologies
247.92
17.43
7.56%
GPC
Genuine Parts Company
133.77
-4.92
-3.55%
MSM
MSC Industrial
85.90
5.11
6.33%
GWW
WW Grainger
954.99
-162.73
-14.56%
WCC
Wesco International
213.78
35.49
19.91%
Fastenal Company Corporate Events
Executive/Board ChangesShareholder MeetingsStock Split
Fastenal Company Announces Stock Split and Board Elections
Neutral
Apr 25, 2025
Fastenal Company announced a two-for-one forward stock split of its Common Stock, with the record date set for May 5, 2025, and the effective date at the close of business on May 21, 2025. The stock split will increase the number of shares authorized for issuance to 1.6 billion, and trading will reflect this change starting May 22, 2025. Additionally, during the annual meeting held on April 24, 2025, in Winona, Minnesota, shareholders elected eleven directors, ratified PricewaterhouseCoopers LLP as the independent accounting firm for 2025, and approved the executive compensation package.
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.