MSM: Back in Black

Research evidence excerpt

MSM: Back in Black

Electrical Equipment & Multi-Industry

Distributors - Market Underweight

MSC INDUSTRIAL DIRECT (MSM) July 1, 2026

MSM: Back in Black Rating:

Peer Perform

The Wolfe Byte Price: $123.34

Volumes have flipped positive and this inflection likely continues as the cyclical Price Target:

upturn broadens out. Valuation is now at the high end of the historical range, but NA

the relative P/E multiple looks reasonable in light of positive tails from cycle and View MSM Model

structural initiatives. View Comp Table

Company Information

MSM was a strong outperformer, finishing +3.7% against a red tape, following its 52-Week Range $81 - $123

Market Cap. (MM) $6,887

significant beat on both top and bottom-line. Clearly the flip back to positive volume Enterprise Value (MM) $7,409

growth is an important moment that is consistent with the >50 readings for the ISM/ Shares Out. (MM) 55.8

MBI indices, and we see no reason why we should not see further improvement. Avg. Value Traded (MM) $128.68 SI% of Float 5.9%

Management called out an encouraging change in customer behavior, particularly as

it relates to planned seasonal shutdowns and noted that the auto vertical had also 125

turned positive. All in, we view the outlook for accelerating revenue growth to be 120115

110credible, particularly as prior year comps start to ease around the turn of the year.

Click HERE for our Comments and HERE for our Abridged Transcript. 105100

4QFY26 guidance was set with a sales range of 6.5-8.5% and an operating margin 9085

range of 10.0-10.8%, which compared to our 7%/10.1% pre-earnings estimate. 8075

Gross margin is expected to step down Q/Q by typical ~50-60bps, with SG&A Jul-25 Aug-25 Sep-25 Oct-25 Nov-25 Dec-25 Jan-26 Feb-26 Mar-26 Apr-26 May-26 Jun-26

relatively flat Q/Q.