Model Update: Margin Pressure, but Outgrowth Continues

研报英文原文证据摘录

Model Update: Margin Pressure, but Outgrowth Continues

USA | Distributors

Fastenal EquityJulyResearch14, 2026

ESTIMATE CHANGEModel Update: Margin Pressure, but Outgrowth

RATING BUYContinues

PRICE $45.74^

Positive share gains and improving underlying market trends resulted in better

than expected 2Q revenue growth. Margins came in below expectations on PRICE TARGET | % TO PT $52.00 | +14%

unfavorable price/cost, offset by SG&A control. Mgmt. maintained price/cost 52W HIGH-LOW $50.63 - $38.97

neutrality posture, though 2H recovery is not guided, given improvements will FLOAT (%) | ADV MM (USD) 99.7% | 365.18

take place in small steps. That said, we reiterate our Buy rating and PT of $52 MARKET CAP $52.6B

(~37x 2027E EPS), as the company's outgrowth story remains intact. TICKER FAST ^Prior trading day's closing price unless otherwise

noted.

Bottom Line. FAST posted a fourth consecutive quarter of DD top-line growth driven by share gains

and new customer wins, while the market remained stable to modestly positive. Although margin

FY (Dec) CHANGE TO JEFe JEF vs CONS

lagged expectations on challenging price/cost, Mgmt. continues to work toward neutrality, which

2026 2027 2026 2027

should lift incremental margin into the mid-high 20s.

REV <1% <1% +1% +1%

Continue to Focus on Price / Cost Neutrality. Price realization in 2Q was +2.9%, (vs. 3.5% in 1Q), EPS NA NA NM +2%

which was attributed to lapping of pricing actions taken in 2Q25 rather than any change in posture.

Price/cost improved ~10bps q/q but remained a ~40bps headwind in the qtr. Progress to price/ 2026 ($) Q1A Q2A Q3 Q4 FY

cost neutrality is expected to be incremental in 3Q and into year-end. Ongoing cost increases in the EPS 0.30 0.33 0.33 0.29 1.25