MSC Industrial Reports Q1 ADS Increase of 3.5%-4.5%
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Oct 23 2025
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Q1 Operating Margin Outlook: The company anticipates an adjusted operating margin of 8%-8.6% for Q1.
Positive Year-End Performance: Average daily sales increased by 2.7% compared to the previous year, with an adjusted operating margin of 9.2%, surpassing expectations.
Strong Cash Flow Generation: The company achieved a free cash flow conversion of 122% for the fiscal year, exceeding its annual target.
Shareholder Returns: Approximately $229 million was returned to shareholders through dividends and share repurchases, supported by robust cash flow and a healthy balance sheet.
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Analyst Views on MSM
Wall Street analysts forecast MSM stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for MSM is 93.33 USD with a low forecast of 90.00 USD and a high forecast of 96.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
5 Analyst Rating
1 Buy
4 Hold
0 Sell
Hold
Current: 84.250
Low
90.00
Averages
93.33
High
96.00
Current: 84.250
Low
90.00
Averages
93.33
High
96.00
About MSM
MSC Industrial Direct Co, Inc. is a distributor of a range of metalworking and maintenance, repair and operations (MRO) products and services. Its range of metalworking and MRO products includes cutting tools, measuring instruments, tooling components, metalworking products, fasteners, flat stock, raw materials, abrasives, machinery hand and power tools, safety and janitorial supplies, plumbing supplies, materials handling products, power transmission components and electrical supplies. It offers saleable stock-keeping units through its e-commerce channels, including its Website https://www.mscdirect.com; its inventory management solutions; its brochures, and its customer care centers, customer fulfillment centers, regional inventory centers and warehouses. It offers advanced tools that integrate its solutions with customer purchasing platforms and workflows. This includes straightforward integrations, such as embedding customer inventory levels into searches on the Company’s Website.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
MSC Industrial Reports Q1 Earnings of $51.8M with 4% Revenue Growth
- Earnings Growth: MSC Industrial's first-quarter net income reached $51.8 million, translating to earnings per share of $0.93, which marks a significant increase from last year's $46.6 million and $0.83 per share, indicating sustained improvement in the company's profitability.
- Adjusted Earnings: Excluding special items, adjusted earnings stood at $55.53 million, or $0.99 per share, reflecting robust performance in core operations and bolstering investor confidence in the company's financial health.
- Revenue Increase: The company reported a 4% year-over-year revenue growth, totaling $965.684 million compared to $928.484 million last year, demonstrating a recovery in market demand and the effectiveness of its sales strategies.
- Market Outlook: With both revenue and earnings on the rise, MSC Industrial showcases strong competitive positioning in the industrial supply sector, setting a solid foundation for future expansion and growth opportunities.
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MSC Industrial Direct Reports Q1 Earnings Beat but Stock Falls on Cautious Outlook
- Earnings Beat: MSC Industrial Direct reported first-quarter adjusted earnings of $0.99 per share, surpassing the analyst consensus of $0.95 and marking a 15.1% year-over-year increase, indicating strong market performance, yet the stock fell due to a cautious outlook.
- Sales Growth: The company achieved net sales of $965.7 million in the first quarter, exceeding expectations of $963.6 million and reflecting a 4.0% year-over-year increase, showcasing ongoing sales momentum despite market concerns about future profitability.
- Margin Improvement: The adjusted operating margin increased to 8.4% from 8.0% last year, achieving a 10 basis point gain, which demonstrates progress in cost control and operational efficiency, although future margin expectations have been tempered.
- Future Outlook: For Q2 of fiscal 2026, MSC expects average daily sales growth between 3.5% and 5.5%, with adjusted operating margins projected between 7.3% and 7.9%, and while management remains optimistic about sustained profitable growth, holiday timing may impact short-term performance.
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