Fastenal Co (FAST, Financial) has recently experienced a notable uptick in its stock performance, with a 7.20% gain over the past week and an impressive 16.98% gain over the past three months. The company's market capitalization stands at a robust $38.85 billion, with the current stock price at $67.93. When compared to the GF Value of $62.27, Fastenal is currently deemed to be Fairly Valued, a shift from its previous status of Modestly Undervalued three months ago when the GF Value was $62.45.
Introduction to Fastenal Co
Fastenal Co, a key player in the Industrial Distribution industry, has come a long way since its inception in 1967. With a history of expansion and diversification, Fastenal now boasts a vast network of approximately 1,600 branches, over 1,700 on-site locations, and 14 distribution centers. The company has successfully maintained its focus on fasteners, which account for 30%-35% of sales, while also offering a range of supply-chain solutions, including vending and vendor-managed inventory. This strategic approach has allowed Fastenal to cater to a substantial customer base of 400,000 active clients.
Assessing Fastenal's Profitability
Fastenal's financial health is reflected in its exceptional Profitability Rank of 10/10, indicating a strong likelihood of continued profitable operations. The company's Operating Margin stands at 20.70%, surpassing 95.21% of 146 companies in the industry. Furthermore, Fastenal's Return on Equity (ROE) is an impressive 34.49%, Return on Assets (ROA) is 24.74%, and Return on Invested Capital (ROIC) is 29.85%, each outperforming the vast majority of their industry peers. These figures not only demonstrate Fastenal's efficiency in generating profits from its equity, assets, and invested capital but also underscore its decade-long consistency in profitability.
Growth Trajectory of Fastenal
Fastenal's growth metrics are equally impressive, with a Growth Rank of 10/10. The company has achieved a 9.30% 3-Year Revenue Growth Rate per Share and an 8.80% 5-Year Revenue Growth Rate per Share, indicating a consistent upward trend. Looking ahead, the estimated Total Revenue Growth Rate for the next 3 to 5 years is 8.43%. Earnings per Share (EPS) growth rates are also strong, with a 3-Year EPS without NRI Growth Rate of 11.10% and a 5-Year rate of 11.70%. The future EPS Growth Rate (3Y to 5Y Est) is projected at 8.56%, suggesting that Fastenal's growth trajectory is set to continue.
Notable Shareholders in Fastenal
Among the notable holders of Fastenal stock, Mairs and Power (Trades, Portfolio) leads with 3,233,893 shares, representing 0.57% of the company. Baillie Gifford (Trades, Portfolio) follows with 2,744,375 shares (0.48%), and Jim Simons (Trades, Portfolio) holds 487,888 shares (0.09%). These significant investments by reputable firms and individuals underscore the confidence in Fastenal's market position and future prospects.
Competitive Landscape
In comparison to its competitors, Fastenal holds its ground with a market cap close to that of Ferguson PLC (FERG, Financial) at $38.47 billion, and not far behind W.W. Grainger Inc (GWW, Financial) with a market cap of $43.29 billion. Watsco Inc (WSO, Financial), another competitor, has a market cap of $15.59 billion, which is considerably lower than Fastenal's, indicating Fastenal's strong position within the industry.
Conclusion
In summary, Fastenal Co's recent stock performance, with a 7.20% gain over the past week and a 16.98% gain over the past three months, reflects the company's solid fundamentals. Its Fairly Valued status according to the GF Value, combined with a top-tier Profitability Rank and consistent growth, positions Fastenal as a compelling option for investors. The company's robust market position relative to its competitors further solidifies its investment potential. With these factors in mind, Fastenal Co presents an attractive opportunity for those looking to invest in a company with a proven track record of profitability and growth.
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
