The chart below shows how DXPE performed 10 days before and after its earnings report, based on data from the past quarters. Typically, DXPE sees a -0.01% change in stock price 10 days leading up to the earnings, and a +17.04% change 10 days following the report. On the earnings day itself, the stock moves by +3.34%. This data can give you a slight idea of what to expect for the next quarter's release.
Positive
Key Financial Metrics Surge: Record year for key financial metrics including sales per business day, gross profit margins, and adjusted EBITDA margin.
Record Sales Achievement: Sales increased by 7.4% to $1.8 billion in fiscal 2024, achieving a new high sales watermark for DXP.
Gross Profit Margin Improvement: Gross profit margins improved by 77 basis points to 30.9%, reflecting operational efficiencies and successful acquisitions.
Adjusted EBITDA Performance: Adjusted EBITDA for fiscal 2024 was $191 million, with adjusted EBITDA margins exceeding 10% for the second consecutive year.
Pumping Solutions Growth: Innovative Pumping Solutions segment grew by 47.7% year-over-year, significantly contributing to overall sales growth.
Strategic Acquisition Success: Successful execution of 7 acquisitions in fiscal 2024, enhancing market diversification and positioning for future growth.
Strong Free Cash Flow: Generated $77 million in free cash flow, demonstrating strong cash generation capabilities while investing in growth.
Debt Refinancing Strategy: Refinanced debt, reducing interest costs and maintaining a flexible capital structure to support future acquisitions and investments.
High Return on Invested Capital: Achieved a return on invested capital (ROIC) of 39%, reflecting improved profitability and efficient working capital management.
Sales Growth per Day: Sales per business day increased to $7.595 million in Q4, up 13.8% compared to Q4 of 2023.
Negative
Supply Chain Services Decline: Sales growth in Supply Chain Services declined by 1.5% year-over-year, indicating challenges in that segment.
Supply Chain Services Decline: Facility closures by customers negatively impacted Supply Chain Services performance, leading to a slight decrease in sales.
Service Centers Growth Stagnation: Despite overall sales growth, the Service Centers segment only grew by 1.9%, suggesting potential stagnation in that area.
SG&A Expense Concerns: SG&A expenses increased by $44.3 million from fiscal 2023 to 2024, raising concerns about cost management as SG&A as a percentage of sales also increased to 22.8%.
Cash Decrease and Liquidity Concerns: The company experienced a decrease in cash on the balance sheet by $24.8 million compared to the end of Q4 2023, which may raise liquidity concerns.
Modest Gross Profit Improvement: While gross profit margins improved, the increase was modest at 77 basis points, which may not be sufficient to offset rising costs in the future.
DXP Enterprises, Inc. (NASDAQ:DXPE) Q4 2024 Earnings Call Transcript
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