DNOW Should I Buy
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DNOW Inc. is not a strong buy at the moment for a beginner investor with a long-term strategy. The company's financial performance is weak, with significant net income and EPS declines, ongoing ERP issues, and legal investigations. While the technical indicators show some positive momentum, the lack of strong proprietary trading signals and negative news sentiment suggest caution. Holding the stock or exploring other opportunities may be more prudent.
The MACD histogram is positive and expanding, indicating upward momentum. RSI is at 71.023, suggesting the stock is approaching overbought territory. Moving averages are converging, showing no clear trend. Key resistance levels are at 12.48 and 12.735, while support levels are at 11.655 and 11.4.
Revenue increased significantly by 67.95% YoY in Q4 2025, showing potential for growth if ERP issues are resolved.
ERP challenges post-acquisition, significant net income and EPS declines, ongoing legal investigations, and hedge fund selling activity.
In Q4 2025, revenue increased by 67.95% YoY to $959 million. However, net income dropped by -770.83% YoY to -$161 million, EPS declined by -568.18% YoY to -1.03, and gross margin fell by -77.63% YoY to 5.21.
Stifel lowered the price target from $18 to $16 but maintained a Buy rating, citing ERP issues as transitory.
