MSC Industrial Earnings Beat Estimates in Q3, Revenues Dip Y/Y

MSC Industrial Direct Company, Inc. MSM reported third-quarter fiscal 2025 (ended on May 31, 2025) adjusted earnings per share (EPS) of $1.08, which beat the Zacks Consensus Estimate of $1.03. The bottom line decreased 18.8% year over year.

Including one-time items, the company reported an EPS of $1.02 compared with the year-ago quarter’s $1.27.

MSM’s Average Daily Sales Fall Y/Y in Q3

MSC Industrial generated revenues of around $971 million in the quarter under review, down 0.8% from $979 million in the year-ago quarter. The top line beat the Zacks Consensus Estimate of $970 million. Average daily sales fell 0.8% year over year in the quarter. However, this came in line with the company’s expectations, driven by improving performance in volumes. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)

MSC Industrial’s Q3 Gross Margin Rises Y/Y

The cost of goods sold decreased 1% year over year to $573 million. Gross profit was down 0.7% to $398 million. The gross margin was 41% compared with the year-ago quarter’s 40.9%.

Operating expenses increased 8% year over year to $312 million in the fiscal third quarter. Adjusted operating income amounted to $87 million, down 21.8% from $111.5 million in the prior-year quarter. The adjusted operating margin was 9%, a contraction from the prior-year quarter’s 11.4%.

MSM’s Cash & Debt Position

MSC Industrial had cash and cash equivalents of $71.7 million at the end of the fiscal third quarter compared with $29.6 million at the end of fiscal 2024. It generated a cash flow from operating activities of $253 million in the first nine months of fiscal 2025 compared with $303 million in the comparable period in fiscal 2024.

The company’s long-term debt was around $285 million at the end of the reported quarter, up from $279 million at fiscal 2024-end.

MSC Industrial’s Q4 Guidance

MSM expects fourth-quarter fiscal 2025 average daily sales to decline 0.5% or increase 1.5% from the year-ago quarter's actual. The adjusted operating margin is expected between 8.5% and 9% for the quarter.

MSM Stock’s Price Performance

The company’s shares have gained 20% in the past year compared with the industry’s growth of 15.8%.

MSC Industrial’s Zacks Rank

MSM currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Industrial Services Stocks Awaiting Results

W.W. Grainger, Inc. GWW is expected to release its first-quarter 2024 results on August 1.

The Zacks Consensus Estimate for Grainger’s earnings per share is pegged at $10.00 for the fiscal first quarter, implying a rise of 2.5% from the year-ago reported figure. The consensus estimate for Grainger’s total revenues is pinned at $4.5 billion, indicating a year-over-year increase of 4.7%.

Hillenbrand, Inc. HI is anticipated to release its third-quarter fiscal 2025 results soon.

The Zacks Consensus Estimate for Hillenbrand’s earnings per share is pegged at 50 cents for the third fiscal quarter, implying a decline of 41.2% from the year-ago reported figure. The consensus estimate for Hillenbrand’s total revenues is pinned at $572 million, indicating a year-over-year dip of 27.2%.

Hudson Technologies, Inc. HDSN is expected to release its second-quarter 2025 results soon. 

The Zacks Consensus Estimate for Hudson’s earnings per share is pegged at 15 cents for the second quarter, implying a decline of 25% from the year-ago reported figure. The consensus estimate for Hudson Industrial’s total revenues is pinned at $69 billion, indicating a year-over-year decrease of 8%.

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This article originally published on Zacks Investment Research (zacks.com).

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