DXP Earnings: What To Look For From DXPE

Industrial distributor DXP Enterprises (NASDAQ:DXPE) will be reporting results this Wednesday after the bell. Here’s what you need to know.

DXP beat analysts’ revenue expectations last quarter, reporting revenues of $513.7 million, up 8.6% year on year. It was a mixed quarter for the company, with an impressive beat of analysts’ revenue estimates but a significant miss of analysts’ EPS estimates.

This quarter, the market is expecting DXP’s revenue to grow 6% year on year, slowing from the 15.7% increase it recorded in the same quarter last year.

Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. DXP has missed Wall Street’s revenue estimates multiple times over the last two years.

Looking at DXP’s peers in the maintenance and repair distributors segment, some have already reported their Q4 results, giving us a hint as to what we can expect. W.W. Grainger delivered year-on-year revenue growth of 4.5%, beating analysts’ expectations by 0.7%, and Transcat reported revenues up 25.6%, topping estimates by 4.1%. W.W. Grainger traded up 9% following the results while Transcat was also up 11.5%.

There has been positive sentiment among investors in the maintenance and repair distributors segment, with share prices up 4.3% on average over the last month. DXP is up 19.2% during the same time and is heading into earnings with an average analyst price target of $136.50 (compared to the current share price of $150.86).

When a company has more cash than it knows what to do with, buying back its own shares can make a lot of sense–as long as the price is right. Luckily, we’ve found one, a low-priced stock that is gushing free cash flow AND buying back shares.