Why This Industrial Bellwether Could Fall When It Reports Earnings: Should Investors Fear a Recession?
Industrial supplies wholesale distributor Fastenal (NASDAQ: FAST) outpaced the broader market by a wide margin in 2019, as shares raced higher by 41% against the S&P 500 index's gain of nearly 29%. The company reports on its final quarter of 2019 on Jan. 17 before markets open for trading. Investors will pay special attention to this report, as it will set the tone for Fastenal's share price performance in 2020, but also because the company's operations give us some insight into the current health of the manufacturing and construction industries. Below, let's review what the report might tell us about Fastenal's results -- and the broader economy in general.
Fastenal's share price ascent last year was fueled in part by vibrant sales growth. Through the first three quarters of 2019, Fastenal booked $4.1 billion in revenue, translating into year-over-year top-line growth of 8.7%. Revenue advanced by nearly 8% in the third quarter over the comparable period, to $1.4 billion.
Will this sales momentum continue? We already know that the company experienced a curbing of its growth rate in two of the last three months of the year, as Fastenal has released its October 2019 and November 2019 monthly sales reports (December's report will be released simultaneously with earnings on the 17th).
Source Fool.com
