DNOW Earnings Prediction
The chart below shows how DNOW performed 10 days before and after its earnings report, based on data from the past quarters. Typically, DNOW sees a +0.19% change in stock price 10 days leading up to the earnings, and a +0.63% change 10 days following the report. On the earnings day itself, the stock moves by +0.44%. This data can give you a slight idea of what to expect for the next quarter's release.
DNOW Key Earning Data
2024/Q4
Year Over Year
Quarter Over Quarter
Total Revenue
571.00M
2.88%
-5.78%
Gross Margin
23.29%
-0.56%
4.53%
Operating Margin
5.43%
-5.89%
-11.13%
Net Margin
4.03%
-84.79%
87.44%
EPS
0.22
-84.06%
83.33%
No Data Available
DNOW Earnings Analysis
DNOW Inc Corporation (DNOW.N) Earnings Conference Call
Positive
Earnings Per Share Beat: NOW Inc. reported an EPS of $0.25, exceeding expectations of $0.14, indicating strong financial performance.
Record Revenue Achievement: The company achieved a revenue of $2.4 billion for the full year 2024, marking a 2% increase year-over-year and the highest revenue since 2019.
Gross Margin Improvement: Fourth quarter gross margin improved to 23.3%, up 100 basis points sequentially, aided by a favorable product mix and vendor considerations.
Free Cash Flow Achievement: NOW Inc. generated $289 million in free cash flow for the full year 2024, representing a 165% free cash flow conversion, one of the best years since 2015.
Share Repurchase Programs: The company completed its $80 million share repurchase program, repurchasing approximately 7 million shares, and announced a new $160 million share repurchase program, demonstrating confidence in its cash generation capabilities.
Acquisition Impact on Revenue: The acquisition of Trojan is expected to enhance NOW Inc.'s water management solutions and contribute to revenue growth in the process solutions business.
Debt-Free Financial Strength: The company has maintained a debt-free status with a cash position of $256 million, providing a strong balance sheet for future investments and acquisitions.
Resilience Amid Market Decline: NOW Inc. expects to achieve growth in 2025 despite anticipated declines in market activity, showcasing resilience and strategic planning.
Cost Control Success: The company has successfully implemented cost control initiatives, leading to improved earnings and cash generation in its core legacy businesses.
Negative
Revenue Decline Challenges: Despite beating earnings expectations, NOW Inc. reported a sequential revenue decline of 6% in Q4 2024, indicating potential challenges in maintaining growth momentum.
Customer Spending Decline: The company anticipates a decline in upstream customer spending in 2025 due to efficiency gains in drilling and completions, which could negatively impact revenue.
Sales Decline Forecast: NOW Inc. expects a $40 million sales decline in fabrication for 2025 as a major customer plans to exhaust existing inventory and only place project-specific orders.
Revenue Reduction Forecast: The company also forecasts a $30 million reduction in revenues from 2024 business that was bid out at margins lower than the cost to service those revenues, indicating potential profitability issues.
International Revenue Decline: International revenue decreased by 17% year-over-year in 2024, reflecting project delays and a challenging market environment.
Canadian Revenue Decline: The Canadian revenue for 2024 was down 10% year-over-year, suggesting difficulties in that market segment.
Gross Margin Decline: The overall gross margins for 2024 were lower than in 2023, highlighting pricing pressures, particularly in steel products, which could affect profitability going forward.
DNOW FAQs
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DNOW Earning Call Sentiment
NOW Inc. (NYSE:DNOW) Q4 2024 Earnings Call Transcript
DNOW.N
3.11%Positive
Despite a slight sequential revenue decline, DNOW demonstrates strong financial health with increased EPS, robust free cash flow, and a significant share repurchase program. The optimistic guidance, especially in the energy evolution market and midstream interest, suggests positive future prospects. The Q&A reveals constructive tariff impacts and expansion opportunities, which further bolster sentiment. With a market cap of $1.44 billion, the stock is likely to react positively, anticipating a 2% to 8% increase over the next two weeks.
