Overview

• Specialty distribution firm's Q4 revenue missed analyst expectations

• Adjusted EPS for Q4 missed analyst expectations

• Company generated $84 mln in operating cash flow for 2025

Outlook

• Company sees backlog growth and improved sales momentum for 2026

• Company focuses on building higher-margin businesses and strong free cash flow

Result Drivers

• MARGIN PRESSURE - Margin pressure was driven by shifts in product and solutions mix, acquisition-related impacts, and timing of employee-related costs

• ACQUISITIONS - Revenue growth was driven by acquisitions, contributing $121.5 mln to full-year revenue

Company press release: ID:nBw2ShP9Ja

Key Details

Metric	Beat/Miss	Actual	Consensus Estimate
Q4 Revenue	Miss	$481.60 mln	$496.30 mln (3 Analysts)
Q4 Adjusted EPS	Miss	$0.18	$0.32 (3 Analysts)
Q4 EPS		-$0.14
Q4 Adjusted EBITDA		$35.44 mln
Q4 Adjusted Operating Income		$26.52 mln
Q4 Operating Income		$7.72 mln

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 2 "strong buy" or "buy", 1 "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the industrial machinery & equipment peer group is "buy"

• Wall Street's median 12-month price target for Distribution Solutions Group Inc is $38.50, about 29.6% above its March 4 closing price of $29.71

• The stock recently traded at 17 times the next 12-month earnings vs. a P/E of 17 three months ago

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