FAST US S&P 500NASDAQ-100Russell 1000 Earnings call · transcribed from the recording
Fastenal (FAST) · Q3 2026 results and valuation
Share price: $55.49 · 2026-11-11
Results Q3 2026 vs Q2 2026 · previous quarter · published 14 Oct 2026 and 14 Jul 2026
Net income up 4.9% on the previous quarter. Management sounded very upbeat, though noticeably less so answering analysts.
1 · Numbers
+4.9%
Net income vs Q2 2026
Outlook given
Net income 401.6M vs 382.8M
Revenue +3.2%
2 · How management spoke
Very upbeat
More upbeat than 93% of company calls
Answers to analysts: typical, but clearly less so than the script.
Last call it was different: script and answers matched.
3 · What stood out
The number of sites spending $50,000 or more monthly grew nearly 19% to roughly 3,300, while sales from those sites increased roughly 28%.
Valuation
Is Fastenal undervalued?
Reverse DCF. Free cash flow from the last full fiscal year (2025-12-31), grown for 10 years, discounted back, plus a terminal value. “Implied growth” is the rate the current price assumes.
At 5.5% growth a year (3-year revenue growth), the model's fair value is $15.68 a share — the stock trades 254% above it. Today's price assumes 22.8% growth a year.
Current price
$55.49
close of 2026-11-11
Market implies growth of iThe yearly free-cash-flow growth, for the next 10 years, that today’s share price already assumes. If you believe the company grows faster than this, the stock is cheap under this model; slower, and it is expensive.
+22.8% for 10 yrs
Fair value / share
$15.68
Buy below
$11.76
Price vs fair value
Overvalued >200%
Price vs buy-below price
Overvalued >200%
Read between the lines
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Key theme
Investors should expect a 50- to 60-basis point headwind on gross margin on a year-over-year basis.
Source quote
“So yes, you would on a year-over-year basis, typically expect a starting point of a 50- to 60-basis point headwind on our gross margin.”
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Figure
Sales grew 15.5% and earnings grew faster than sales in Q3 2026.
Source quote
“Sales grew 15.5%, earnings grew faster than sales.”
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Figure
The number of sites spending $50,000 or more monthly grew from approximately 2,800 to roughly 3,300, while sales from those sites increased roughly 28%.
Source quote
“The number of sites spending $50,000 or more per month with us grew almost 19% from approximately 2,800 to roughly 3,300, and sales from those sites increased roughly 28%.”
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Figure
Heavy manufacturing accounted for approximately 45% of sales and experienced a daily sales growth of approximately 20% during the quarter.
Source quote
“Heavy manufacturing led the way again. It represented approximately 45% of sales and daily sales grew approximately 20%.”
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Guidance
FAST expects net capital spending of $310 million to $330 million for the full year 2026.
4 more
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Figure
Operating income increased by $90 million from last year, marking the largest year-over-year increase in a single quarter in Fastenal's history.
Source quote
“Operating income increased by $90 million from last year. That's the largest year-over-year increase in a single quarter in Fastenal's history.”
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Figure
Return on invested capital increased 230 basis points to 32.5% on a trailing 12-month basis, which is higher than the 10-year average of approximately 28%.
Source quote
“Return on invested capital increased 230 basis points to 32.5% on a trailing 12-month basis, comparing that with a 10-year average of approximately 28%.”
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Figure
The company returned approximately $1.2 billion to shareholders over the trailing 12 months after funding its operating and capital needs.
Source quote
“Over the trailing 12 months, we returned approximately $1.2 billion after funding our operating and capital needs.”
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Key theme
The company improved operating margin and earnings as price/cost improved sequentially for the second consecutive quarter.
Source quote
“Second, we converted that growth into higher operating margin and earnings, while price/cost improved sequentially for the second consecutive quarter.”
Tone
How upbeat the language was, compared with other companiesiTone counts positive minus negative finance words, adjusted for length. Executives mostly speak positively, so the labels compare each call with every company's latest call: “typical” is the middle third, “very upbeat” the top tenth, “cautious” the bottom tenth.. Dot: Q3 2026. Ring: Q2 2026.
Management sounded noticeably less positive answering analysts than in its prepared script — a bigger drop than in 96% of calls. Scripts are polished in advance; a drop under questioning often marks the topics analysts pressed on, so the answers deserve a closer read than the script.
Sentences that drove the tone
“Market conditions did improve in the first half, and that improvement continued in the third quarter, but our growth exceeded the growth rates in the industrial markets that we serve.”
“We gained share, expanded margins, generated strong cash flow and improved returns.”
“So we're going to constantly pursue cost opportunities and efficiency opportunities while focusing on number one, growing the business.”
Full figures
USD · SEC EDGAR XBRL (10-Q, period end 2026-09-30)
| Metric | Q3 2026period end 2026-09-30 | Q2 2026period end 2026-06-30 | Change | Q3 2025 | YoY |
|---|---|---|---|---|---|
| Revenue | 2.46B | 2.39B | +3.2% | 2.13B | +15.5% |
| Gross profit | 1.10B | 1.06B | +3.9% | 965.8M | +14.4% |
| Operating income | 530.8M | 501.8M | +5.8% | 441.5M | +20.2% |
| Net income | 401.6M | 382.8M | +4.9% | 335.5M | +19.7% |
| EPS | 0.35 | 0.33 | +6.1% | 0.29 | +20.7% |
| P/E today 43.1 | 40.3 | 41.1 | −0.8 | 45.8 | −5.5 |
Topics
Most discussed now
- Two quick housekeeping items before Fastenal gets to the numbers.
- Every result Fastenal reports today was earned by people in its branches, its on-sites, its distribution centers, its truck center...
- Although momentum remains stronger in select industrial markets than in the traditional manufacturing and automotive area.
- Fastenal gained share, expanded margins, generated strong cash flow and improved returns.
- The other half is a bit more of a timing element in regards to primarily volume rebates with suppliers.
Faded since Q2 2026
- Dropped Fastenal mentioned the bonus, and the bonus is just a pure it grew profit dollars extremely fast.
- Fading Improving demand trends, solid execution across the business, and strong cash generation.
- Fading You might say it a blue team effort.
- Fading At I want to reiterate, it is healthy growth.
Latest announcements
Official filings, newest first. Summaries are generated from each filing and its attachment; every figure is checked against the source.
- Results of operations · SEC 8-K
Fastenal reported third-quarter net sales of $2.46 billion, an increase of 15.5% compared to the same period in 2025.
- Results of operations · SEC 8-K
- Material agreement; New financial obligation · SEC 8-K
Fastenal Company entered into a Second Amended and Restated Credit Agreement on June 18, 2026, renewing a revolving credit commitment of $835,000,000 with an accordion option up to $500,000,000.
- Director or officer change · SEC 8-K
Fastenal Company elected Vishal Talwar as an independent director on June 12, 2026, increasing the total number of board members from eleven to twelve.
- Director or officer change · SEC 8-K
- Shareholder vote results · SEC 8-K · routine
- Results of operations · SEC 8-K
- Results of operations · SEC 8-K
Catalyst calendar
management-stated targets — from the latest earnings call; plans, not promises.
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Over time
expected cost savings from the solution
Source quote
“Over time, we expect the solution to generate anywhere between 25% to 30% in overall cost savings.”
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between the fourth quarter of '25 and the first quarter of '26
peak of the year-over-year pricing contribution
Source quote
“The year-over-year pricing contribution is slowing after peaking between the fourth quarter of '25 and the first quarter of '26.”
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full year '26
net capital spending
Source quote
“For full year '26, we continue to expect net capital spending of $310 million to $330 million.”