MSC Industrial falls on weaker margin forecast

MSC Industrial Direct

29/06/2023 19:17

** Shares of industrial equipment distributor MSC Industrial
Direct  MSM.N  down 2.92% at $93.15
    ** Co expects fiscal 2023 gross margin to contract between
100-120 basis points from a year earlier vs analysts' ests of 64
bps contraction
    ** However, forecasts average daily sales growth between
10%-11% Y/Y for 2023 
    ** "Both the higher sales expectation and the margin
headwinds appear to be attributable to large public sector wins,
which add growth but mix margin down" - brokerage Jefferies
    ** MSM posts an adjusted third-quarter profit of $1.74 per
share vs analysts' average estimate of $1.75/share, as per
Refinitiv
    ** Three of nine brokerages rate the stock "buy" or higher,
and six "hold"; their median PT is $100 - Refinitiv
    ** YTD, MSM stock up 14.11% including session move

 (Reporting by Pritam Biswas in Bengaluru)
 ((Pritam.Biswas@thomsonreuters.com))