DXPE

DXP’s second quarter saw a positive market reaction, driven by management’s focus on customer-centric technical services and strong organic and acquisition-fueled growth. Key contributors included robust performance in the Innovative Pumping Solutions (IPS) and Water platforms, which benefited from both organic demand and recent acquisitions. COO Nicholas Little attributed the gains to "staying close to customers, solving real problems in the field and continuing to build momentum across the business." The company also delivered improved cash generation, reflecting operating leverage and disciplined investment. Is now the time to buy DXPE? Find out in our full research report (it’s free). Revenue: $576.5 million vs analyst estimates of $543 million (15.6% year-on-year growth, 6.2% beat) Adjusted EPS: $1.76 vs analyst estimates of $1.59 (10.7% beat) Operating Margin: 9.6%, in line with the same quarter last year Market Capitalization: $3.03 billion While we enjoy listening to the management’s commentary, our favorite part of earnings calls is the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention. Zachary Marriott (Stephens): Asked for detail on monthly sales trends and outlook for Q3; CFO Kent Yee provided a breakdown by month but did not offer specific Q3 guidance, instead sharing year-to-date averages. Zachary Marriott (Stephens): Inquired about sustainability of the 12% EBITDA margin; Yee noted higher water and wastewater mix supports margins but avoided setting a new baseline, saying, “we do believe longer term, the business easily can get to that 12% on a sustainable basis.” Zachary Marriott (Stephens): Requested clarity on normalized capital expenditures; Yee explained prior year’s elevated investments were driven by software, facilities, and private label pump manufacturing to support growth, with current CapEx now at a more typical level. No analyst questions on acquisition integration, competitive landscape, or supply chain disruptions were raised during the call. No analyst questions on international expansion or specific regulatory risks were raised during the call. In the coming quarters, our analysts will focus on (1) the pace and profitability of integrating newly acquired businesses, (2) continued sales and backlog growth in the water and wastewater segment, and (3) whether margin improvements are sustainable as the sales mix evolves. Updates on municipal infrastructure investments and progress in the Canadian market will also serve as important signposts. DXP currently trades at $195, up from $168.37 just before the earnings. At this price, is it a buy or sell? The answer lies in our full research report (it’s free for active Edge members). ONE MORE THING: Top 6 Stocks for This Week. This market is separating quality stocks from expensive ones fast. AI is taking down whole sectors with no warning. In a rotation this fast, you need more than a list of good companies. Our AI system flagged Palantir before it ran 1,662% between October 2022 and February 2026. AppLovin before it ran 753% between February 2024 and February 2026. Nvidia before it ran 1,178% between January 2023 and February 2026. Each week it produces 6 new names that pass the same tests. Get Our Top 6 Stocks for Free HERE. Stocks that have made our list include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+1,154% between June 2020 and June 2025). Find your next big winner with StockStory today.

Image source: The Motley Fool. Thursday, Aug. 6, 2026 at 11:30 a.m. ET Chief Financial Officer - Kent Yee Chief Operating Officer - Nicholas Little Operator: Hello, everyone. Thank you for joining us, and welcome to the DXP Enterprises Q2 2026 Earnings Conference Call. [Operator Instructions] I will now hand the conference over to Kent Yee, CFO. Kent, please go ahead. Kent Yee: Thank you. This is Kent Yee, and welcome to DXP's Q2 2026 Conference Call to discuss our results for the second quarter ending June 30, 2026. Joining me today is our Chief Operating Officer, Nick Little; our Chairman and CEO, David Little, is traveling, and so we will be kind of going forward from that fashion today. Before we get started, I want to remind you that today's call is being webcast and recorded and includes forward-looking statements. Actual results may differ materially from those contemplated by these forward-looking statements. A detailed discussion of the many factors that we believe may have a material effect on our business on an ongoing basis are contained in our SEC filings. DXP assumes no obligation to update that information because of new information or future events. During this call, we may present both GAAP and non-GAAP financial measures. A reconciliation of GAAP to non-GAAP measures is included in our earnings press release. The press release and an accompanying investor presentation are now available on our website at ir.dxpe.com. I will now turn the call over to Nick Little, our Chief Operating Officer, to provide his thoughts and a summary of our second quarter financial results. Nick? Nicholas Little: Good morning, and thank you, Kent. Like Kent said, I'm filling in for David Little, who is having technical difficulties while traveling. I also want to thank everyone for joining us today on DXP's fiscal 2026 Second Quarter Call. We had a very strong second quarter, and I'm proud of how our DXPeople performed. We delivered strong year-over-year and sequential sales growth, expanded profitability and generated quarterly adjusted EBITDA. More importantly, we did it by staying close to our customers, solving real problems in the field and continuing to build momentum across the business. Let me start by saying that Q2 was a strong example of what happens when our DXPeople stay close to customers, execute locally and bring technical expertise to our customers. We grew sales, improved productivity, generated significant free cash flow and continue to advance our strategy of being customer-driven experts, technical, reliable, fast and convenient for our customers. We are pleased to see DXP's performance continue throughout Q2 and remain at record levels through the first half of 2026. This allowed us to achieve strong sales growth and 12% EBITDA margins. Thank you to our 3,510 DXPeople for your hard work and dedication. We welcome our new acquisitions as well as all the new DXPeople, DXP continues to invest in and hire for growth. Total DXP sales for the second quarter were $576.5 million, up 15.6% year-over-year. Organic sales increased 11.1% year-over-year, continuing to show the underlying strength of the business. Our acquisitions are contributing, but our existing teams and branches are also winning with customers. Profitability also improved. Gross profit margin was 31.8%. Income from operations increased to $55.5 million. Adjusted EBITDA was $70.4 million or 12.2% of sales. Net income increased to $28.7 million and diluted EPS was $1.76 compared with $1.43 in the second quarter of 2025. Those are strong results, and I want to be clear that they start with our DXPeople taking care of customers. A special thanks goes to our sales professionals, operations teams, branch leaders, service technicians, engineers, supply chain teams and corporate support teams. DXP works because of DXPeople you can trust. Our customers rely on us to solve problems quickly and provide technical solutions, keeping their operations running and making doing business with DXP fast and convenient. That's what being customer-driven means. From a growth standpoint, we continue to like where DXP is positioned. Customers in water and wastewater, energy infrastructure, general industry, air compression, data centers and other technical markets need reliability, responsiveness and expertise. Those are DXP's strengths, and they create opportunities for us to earn more of the customers' business and drive revenue and margin share. Across DXP, growth is coming from several consistent themes: expanding our technical and engineering solutions, broadening solutions around pumps, automation, filtration and process equipment. Leveraging our decentralized model to pursue local growth opportunities and cross-selling across platforms and integrating acquisitions more efficiently. Our strategy has not changed, and that's a good thing. We want to grow DXP organically and through acquisitions, diversify the company, expand our capabilities and service customers with solutions that are fast, convenient, reliable and supported by DXPeople. We are not chasing growth just to get bigger. We are focused on profitable growth, strong cash generation and customer relationships that last. The broader economy continues to have volatility from tariffs, inflation, interest rates and geopolitical uncertainty, but the work our customers do is mission-critical and the products and services DXP provides are essential to keeping plants, facilities, municipalities and industrial operations moving. That gives our business resilience and it gives our DXPeople a chance to show why DXP is different. During the first half of 2026, our service centers and Innovative Pumping Solutions businesses generated $967.3 million in sales, up 14.3% from prior year. That growth reflects both organic execution and recent acquisitions, especially within IPS and our water and wastewater platform. Innovative Pumping Solutions again led the way in the second quarter. IPS sales increased 52.6% year-over-year and 20.3% sequentially to $142.7 million. This growth was driven by water and wastewater activity, increased production contracts and strategic acquisitions. Our IPS teams continue to show what technical expertise looks like in the field, solving complex customer problems, delivering engineered solutions and helping customers move important projects forward. IPS continues to be a strong example of DXP's growth momentum. DXP Water grew to $97 million in the quarter, nearly doubling year-over-year. Municipal infrastructure investments, regulatory requirements and customer demand for reliable pumping and treating solutions create an attractive long-cycle opportunity for DXP Water. DXP Water generated $175.5 million in sales for the first half of '26, up 85.6% year-over-year, underscoring the momentum we're building in these markets. These markets where our customers value expertise, reliability and know-how. Many IPS projects are long cycle in nature. And when customers choose DXP, they are choosing DXPeople who understand the application, the urgency and the importance of getting the solution right. Backlog within IPS also remains an important indicator of the momentum we're seeing in the business. During the second quarter, average IPS backlog remained strong and increased compared to both prior period and the first quarter. That growth reflects continued demand for engineered pumping solutions, water and wastewater projects and production-related work with customers who rely on DXP for technical expertise and execution. The average backlog levels we saw throughout Q2 give us confidence in the durability of customer activity and support our positive outlook for the remainder of 2026. Service centers also performed well. Sales increased 8.3% year-over-year and 8.9% sequentially to $367.9 million. Organic sales increased $40.9 million compared to the prior year quarter. This is the heart of DXP's local customer-driven model. Our service center teams are close to the customer, they understand the market, and they know how to respond quickly when customers need us. That local presence is what allows DXP to be fast and convenient while still bringing technical expertise to our customers. Supply Chain Services increased modestly to $65.8 million, up 0.6% year-over-year and 1.2% sequentially. SCS continues to onboard new customers and related facilities, although that growth was partially offset by lower activity with existing customers. This business is a great example of why being customer-driven experts because we are not just selling products, we are helping customers improve procurement, manage inventory, reduce complexity and make their supply chain faster, more convenient and more efficient. Acquisitions continue to be an important part of DXP's growth strategy, but we are disciplined about it. We are looking for businesses that fit our culture, strengthen our technical capabilities and help us serve customers better, faster and more conveniently. During the first quarter of 2026, we acquired 3 businesses. And during the second quarter, we acquired one additional business. These acquisitions expand our water and wastewater platform, enhance our capabilities, extend our geographic reach and reinforce our position as a leading distributor of rotating equipment in North America. For the first 6 months of 2026, acquisitions were $90.6 million compared to $55.7 million in the prior year period. We are pleased with how recent acquisition businesses are contributing. At the same time, our focus is integration, cross-selling, retaining great people and making sure each acquired business becomes a part of the DXP culture. We also completed the acquisition of Mequipco on August 1, 2026, funded with cash on the balance sheet and DXP stock. We are excited to welcome these new DXPeople to DXP and look forward to supporting their customers with the broader capabilities of our company and growing DXP Water in Canada. Cash generation improved meaningfully in the second quarter. Free cash flow was $29.8 million for the first 6 months of 2026 (sic) [ Q2 2026 ]. Free cash flow was $56 million compared to negative free cash flow of $8.6 million in the first half of 2025. Our balance sheet liquidity position gives us flexibility to continue to invest in organic growth, fund acquisitions, support working capital and manage the business through different economic environments. We want to keep growing, but we want to do it the DXP way with disciplined customer focus, cash generation and returns that make sense. Overall, I'm very encouraged by our second quarter results and the progress we're making. We delivered strong sales growth, improved profitability, expanded adjusted EBITDA margins, generated strong free cash flow and continue to build DXP through strategic acquisitions. But the real story is our people. Our DXPeople continue to show up every day for customers and for each other. I want to personally thank all of our DXPeople for their hard work, customer focus and execution. We continue to build the new chapter of DXP by being technical experts, providing customer-driven engineered solutions while continuing to be fast and convenient. This is how we win. This is how we earn trust, and this is why customers continue to rely on DXP. As we look forward, our priorities remain unchanged: drive organic growth, expand margins, grow our water and wastewater platform, execute disciplined acquisitions, generate strong free cash flow and increase shareholder value over the long term. I would like to thank all of our employees for their commitment to serving customers and delivering results. Their dedication continues to differentiate DXP in the marketplace. With that, I will turn the call back over to Kent. Kent Yee: Thank you, Nick, and thank you to everyone for joining us for our review of our second quarter 2026 financial results. Q2 financial performance reflects continued execution across DXP with strong sales growth, improved profitability, additional margin expansion and excellent free cash flow generation. Additionally, our results also highlight the continued success of our acquisition strategy and the growing scale of our water and wastewater platform, as Nick mentioned. Our results demonstrate the continued benefits of diversified end markets, the resilience of MRO and supply chain solutions and the meaningful contribution from engineered solution capabilities. As it pertains specifically to our second quarter, DXP's financial results reflect sales growth of 15.6% year-over-year to $576.5 million, including $49.8 million of acquisition sales, organic sales growth of 11.1% year-over-year, reflecting strength across our core business, continued strategic progress in water and wastewater, supported by organic growth, project activity and 3 water acquisitions through Q2, operating income growth of $9.5 million or 20.7% to $55.5 million and adjusted EBITDA of $70.4 million with adjusted EBITDA margins improving to 12.2%, a new high watermark for DXP. In terms of our detailed financial results, total sales for the second quarter increased 15.6% year-over-year to $576.5 million. Acquisitions that have been with DXP for less than a year contributed $49.8 million sales during the quarter. Excluding the impact of acquisitions, organic sales were $526.6 million, representing 11.1% organic growth compared to the second quarter of 2025. Average daily sales for the second quarter were $9.15 million per day versus $7.92 million per day in Q2 of last year. Adjusting for acquisitions, organic average daily sales were $8.36 million per day versus $7.53 million per day in Q2 of 2025. As is typical, sales accelerated throughout the quarter with average daily sales increasing from $9.07 million per day in April to $9.4 million per day in June, reflecting a normal quarter end push, but highlighting strong acceleration coming into quarter end. In terms of our business segments, Innovative Pumping Solutions grew 52.6% year-over-year, followed by Service Centers growing 8.3% and Supply Chain Services growing 0.6% year-over-year. Innovative Pumping Solutions sales increased $49.2 million or 52.6% year-over-year to $142.7 million. This growth reflects increased activity in our Water and Wastewater division, increased production contracts and strategic acquisitions within IPS. Recent acquisitions contributed $47 million of sales during the quarter compared to $9.1 million in Q2 of last year. Excluding acquisitions, IPS organic sales grew $11.3 million or 13.3%. Segment operating income for IPS was $26.7 million, up from $18.6 million in Q2 of last year. In terms of Innovative Pumping Solutions backlog, we experienced increases in the energy and water and wastewater bookings and backlog. Our Q2 energy-related average backlog grew 7.3% sequentially and continues to stem declines we saw in Q3 and Q4 of last year. That said, as we have mentioned, we continue to have some large engineered solutions or projects, and we have continued to recognize revenue in Q2. Excluding some of these projects, our backlog is up 10% from Q1. The conclusion continues to remain that we are trending meaningfully above all notable sales levels, and our backlog has mitigated some declines we saw in the second half of 2025. Our DXP Water platform experienced our 15th consecutive quarter of sequential sales growth with $97.3 million in sales during Q2 and year-to-date sales of $175.5 million, and we will look for this to continue during the second half of 2026. In terms of our Service Centers. Service Center sales increased $28.2 million or 8.3% year-over-year to $367.9 million. Excluding the impact of recent acquisitions, Service Centers grew $40.9 million organically. This growth was driven by increased business activity across multiple regions, including California, Gulf Coast, Southeast, North Texas, South Central and South Rockies. From a segment operating income perspective, Service Centers generated $54.2 million of operating income in the quarter, reflecting continued strength and consistency in the core MRO business. We are building a larger, more diversified platform with attractive end market demand, project opportunities and recurring service potential. Supply Chain Services sales increased $0.4 million or 0.6% year-over-year to $65.8 million. Performance reflects the onboarding of new customers and related facilities, partially offset by decreased activity with certain existing customers. Segment operating income was $6.5 million compared to $5.2 million in the prior year period, reflecting improved profitability despite essentially sales being flat. Turning to gross margins. DXP's total gross margin was 31.8% for the second quarter compared to 31.6% in Q2 of 2025. The improvement reflects continuing margin expansion efforts and a positive contribution from recent acquisitions. Our SG&A for the quarter increased $15.7 million from Q2 of last year to $127.6 million. The increase reflects increased payroll-related costs, depreciation and amortization, rent, insurance and professional fees. However, SG&A as a percentage of sales improved to 22.1% from 22.4% in Q2 of last year, reflecting operating leverage as sales increase. Turning to EBITDA. Q2 2026 adjusted EBITDA was $70.4 million compared to $57.3 million in Q2 of 2025. Adjusted EBITDA margins were 12.2%, up from 11.5% last year. The improvement reflects sales growth, gross margin strength and the fixed cost leverage we continue to see as we scale the business. For the quarter, this translated into 1.5x operating leverage. In terms of EPS, our net income for Q2 was $28.7 million. Earnings per diluted share for Q2 2026 were $1.76 per share versus $1.43 per share last year. The year-over-year improvement primarily reflects higher sales, improved gross profit and stronger operating income, partially offset by higher interest expense and a higher effective tax rate. Turning to the balance sheet and cash flow. In terms of working capital, net working capital as of June 30, 2026, was $393.3 million, an increase of $31.7 million compared to December 31, 2025. The increase was primarily due to sustained sales growth and acquisitions. In terms of cash, we had $226.6 million in cash on the balance sheet as of June 30. We also had $147.9 million of availability under our ABL, resulting in total liquidity of $374.5 million, providing DXP with sufficient dry powder to pursue acquisitions. CapEx in the second quarter was $2.6 million compared to $10.3 million in Q2 of last year. For the first 6 months of 2026, capital expenditures were $5.9 million compared to $30.3 million in the first 6 months of 2025. This reflects a more normalized level of capital spending following the elevated investments we made last year. Turning to free cash flow. Free cash flow for the second quarter was $29.8 million versus $8.3 million in Q2 of 2025. For the first 6 months of 2026, free cash flow was $56 million compared to negative $8.6 million in the prior year period. Over the last 4 quarters, DXP has produced $118.7 million in free cash flow, creating a new fact pattern for DXP, consistently averaging $29 million in free cash flow per quarter while also growing the business or sales per business day. This improvement reflects increases in profitability, stronger operating cash flow and a meaningful reduction in capital expenditures. As of June 30, our fixed charge coverage ratio was 2.97:1, and our secured leverage ratio was 2.3:1 with a covenant EBITDA for the last 12 months of $267 million. Total debt outstanding on June 30 was $842.5 million. In terms of acquisitions, we acquired 4 businesses during the first half of 2026 for total consideration of $135.6 million. These acquisitions are directly aligned with our strategy to expand our water and wastewater platform, extend our geographic reach and support our position as a leading distributor of rotating equipment in North America. We continue to see acquisitions as a disciplined, repeatable growth lever for DXP, particularly where we can add strong teams, technical expertise and market access in attractive end markets. As Nick mentioned, subsequent to quarter end, we also completed the acquisition of Mequipco Limited, which is based in Western Canada and provides DXP with a beachhead to expand DXP Water in Canada going forward. The acquisition was funded with cash on the balance sheet and DXP stock, further demonstrating the strength of our pipeline and our ability to execute. On July 2, 2026, we entered into a new restated loan and security agreement, increasing our ABL to $225 million and extending the maturity to July 2031. This further enhances our financial flexibility as we continue to invest in the business organically and through acquisitions. Finally, on July 20, S&P Global Ratings upgraded DXP's issuer credit rating and first lien term loan ratings to B+ from B with a stable outlook. We view this upgrade as external recognition of the progress we have made strengthening the balance sheet, diversifying our end market mix, scaling EBITDA and executing a disciplined acquisition strategy while maintaining financial flexibility. In summary, we are pleased with our second quarter and first half performance in 2026. We delivered strong sales growth, expanded margins, improved adjusted EBITDA and generated significant free cash flow by continuing to execute on our acquisition strategy. The quarter reinforces that acquisitions and water and wastewater are becoming increasingly important contributors to DXP's growth profile. We believe DXP remains well positioned to continue creating value through our resilient MRO and supply chain solutions, engineered solution capabilities, disciplined acquisitions and exposure to secular trends. We are excited about the future. We look forward with confidence to sustained growth and market outperformance. I will now turn the call over for questions. Operator: [Operator Instructions] Your first question comes from the line of Zach Marriott with Stephens. Zachary Marriott: Congrats on the solid quarter. I want to start with daily sales trends by month. Can you please fill in the gap for us in May for Q2 and then share what color you can for Q3 thus far? Kent Yee: Zach, thank you. Yes. I'll walk through the sales per business day. I'll really just go through Q1 and Q2, so you just are clear on the full first half of 2026. January was $7.2 million per day; February, $8.4 million per day; March, $9.2 million per day; April, $9.1 million; May, $9 million; June, $9.4 million. Year-to-date average, just if you just want to average that out, that's $8.7 million per day for the full year-to-date average. Zachary Marriott: Understood. And on EBITDA margins, you have been in the 11% range pretty consistently and just reported at 12%. As you look into Q3, is it more likely you'll stay at 12% or head back closer to 11%? Kent Yee: Zach, part of that is obviously mix. The thing I'd point out within the IPS segment is water and wastewater is approaching 70% of the segment sales. And while we had great profitability on both sides of the business, meaning the energy side as well as the water side, that increased contribution and an overall average higher operating income margin in water and wastewater would suggest we have a chance of repeating that. This is our first quarter at 12%. So I don't want to promise anything. And as you know, we don't give direct guidance, but we do believe longer term, the business easily can get to that 12% on a sustainable basis. But this is our first quarter hitting it. So... Zachary Marriott: Understood. And last one, if I could, on CapEx. I heard you that this year is a more normalized level compared to last year. Could you please just touch on what those elevated investments from last year entailed? Kent Yee: Yes. No problem, Zach. And big picture, just in terms of CapEx, there's very little for us of maintenance CapEx. That said, just in terms of your specific question, last year, we made investments in software facilities, equipment, a lot of different things as we often do when we get in a growth prospect. Additionally, on the rotating equipment side, we invest in patterns and different things because we do source and make our own branded private label pumps. And so those were the investments we were making that continue to help us to be the leading rotating equipment provider in North America. Operator: There are no further questions at this time. This concludes today's call. Thank you for attending. You may now disconnect. 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This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has positions in and recommends DXP Enterprises. The Motley Fool has a disclosure policy. DXP Enterprises (DXPE) Q2 2026 Earnings Call Transcript was originally published by The Motley Fool

As the Q2 earnings season comes to a close, it’s time to take stock of this quarter’s best and worst performers in the maintenance and repair distributors industry, including DXP (NASDAQ:DXPE) and its peers. Supply chain and inventory management are themes that grew in focus after COVID wreaked havoc on the global movement of raw materials and components. Maintenance and repair distributors that boast reliable selection and quickly deliver products to customers can benefit from this theme. While e-commerce hasn’t disrupted industrial distribution as much as consumer retail, it is still a real threat, forcing investment in omnichannel capabilities to serve customers everywhere. Additionally, maintenance and repair distributors are at the whim of economic cycles that impact the capital spending and construction projects that can juice demand. The 9 maintenance and repair distributors stocks we track reported an exceptional Q2. As a group, revenues beat analysts’ consensus estimates by 4%. Thankfully, share prices of the companies have been resilient as they are up 5.4% on average since the latest earnings results. Founded during the emergence of Big Oil in Texas, DXP (NASDAQ:DXPE) provides pumps, valves, and other industrial components. DXP reported revenues of $576.5 million, up 15.6% year on year. This print exceeded analysts’ expectations by 6.2%. Overall, it was an exceptional quarter for the company with a beat of analysts’ EPS estimates. Interestingly, the stock is up 14.1% since reporting and currently trades at $192.16. Read why we think that DXP is one of the best maintenance and repair distributors stocks, our full report is free. Serving the pharmaceutical, industrial manufacturing, energy, and chemical process industries, Transcat (NASDAQ:TRNS) provides measurement instruments and supplies. Transcat reported revenues of $92.95 million, up 21.6% year on year, outperforming analysts’ expectations by 7.4%. The business had an incredible quarter with a beat of analysts’ EPS and EBITDA estimates. Transcat scored the biggest analyst estimate beat of the whole group. The market seems content with the results as the stock is up 1.3% since reporting. It currently trades at $93.11. Is now the time to buy Transcat? Access our full analysis of the earnings results here, it’s free. Founded in 1967, Fastenal (NASDAQ:FAST) provides industrial and construction supplies, including fasteners, tools, safety products, and many other product categories to businesses globally. Fastenal reported revenues of $2.39 billion, up 14.7% year on year, exceeding analysts’ expectations by 1.9%. It may have had the worst quarter among its peers, but its results were still good as it also locked in EPS in line with analysts’ estimates. Interestingly, the stock is up 10% since the results and currently trades at $51.77. Read our full analysis of Fastenal’s results here. With roots dating back to 1959 and a strategic focus on extending the life of transportation assets, VSE Corporation (NASDAQ:VSEC) provides aftermarket parts distribution and maintenance, repair, and overhaul services for aircraft and vehicle fleets in commercial and government markets. VSE Corporation reported revenues of $449.1 million, up 65% year on year. This number surpassed analysts’ expectations by 4.8%. Overall, it was an incredible quarter as it also put up a beat of analysts’ EPS estimates and an impressive beat of analysts’ EBITDA estimates. VSE Corporation pulled off the fastest revenue growth among its peers. The stock is up 3.8% since reporting and currently trades at $224. Read our full, actionable report on VSE Corporation here, it’s free. Founded in NYC’s Little Italy, MSC Industrial Direct (NYSE:MSM) provides industrial supplies and equipment, offering vast and reliable selection for customers such as contractors MSC Industrial reported revenues of $1.05 billion, up 7.8% year on year. This result topped analysts’ expectations by 1.6%. Overall, it was a very strong quarter as it also recorded a beat of analysts’ EPS estimates. The stock is up 3.3% since reporting and currently trades at $122.92. Read our full, actionable report on MSC Industrial here, it’s free. Over the past year, investors have been forced to repeatedly answer the same question: what is the market’s biggest risk? The answer has changed several times, and each shift has reshaped market leadership. Late in 2025 and early 2026, artificial intelligence became the market’s primary uncertainty. Investors questioned whether AI would erode software pricing power and weaken competitive moats as AI made it easier to replicate once-differentiated products. By the spring, technology took a back seat to geopolitics. The U.S. conflict with Iran briefly became the market’s dominant narrative, raising concerns about oil prices, inflation, and global growth. But as energy markets remained orderly and fears of a prolonged supply disruption faded, investors quickly turned their focus back to fundamentals. Want to invest in winners with rock-solid fundamentals? Check out our Top 6 Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.

Never miss an important update on your stock portfolio and cut through the noise. Over 7 million investors trust Simply Wall St to stay informed where it matters for FREE. DXP Enterprises (DXPE) is drawing attention after reporting second quarter 2026 results on 5 August, with higher sales, net income and earnings per share compared with the same period last year. See our latest analysis for DXP Enterprises. DXP Enterprises has been in a strong upswing, with the share price delivering a 22.51% 7 day return and 78.57% year to date, alongside a very large 5 year total shareholder return that points to sustained momentum rather than a short term spike. If DXP Enterprises has caught your attention, this is a good moment to see what else is moving in industrial and infrastructure themes through the 37 power grid technology and infrastructure stocks After a 78.57% year to date surge and a share price near the latest analyst target, DXP Enterprises now presents a tougher question: Does the current valuation still leave enough upside to compensate for the risks from here? The most followed DXP Enterprises narrative puts fair value at $170 per share, which sits below the latest close of $192.36 and frames today’s premium against those long term assumptions. Read the complete narrative. Curious how DXP Enterprises gets from today’s earnings to that higher long term profit base. The narrative leans on faster revenue growth, rising margins and a lower future P/E multiple that still keeps the valuation punchy. Result: Fair Value of $170 (OVERVALUED) Have a read of the narrative in full and understand what's behind the forecasts. However, you also need to weigh energy exposure and rising labor costs. These factors could pressure margins and undermine the upbeat DXP Enterprises narrative if growth slows. Find out about the key risks to this DXP Enterprises narrative. The most popular narrative has DXP Enterprises trading above a $170 fair value. Yet Simply Wall St's DCF model points to a value of about $203.38 per share, with the current price of $192.36 sitting roughly 5.4% below that estimate. Which story do you think is closer to reality? Look into how the SWS DCF model arrives at its fair value. Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out DXP Enterprises for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 52 high quality undervalued stocks. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity. With bullish and cautious signals both in play around DXP Enterprises right now, it makes sense to move fast and test the story against the numbers yourself. To see how the current price stacks up against both concerns and potential upside, start by weighing the 3 key rewards and 2 important warning signs. If DXP Enterprises is on your radar after these results, you may also want to explore other opportunities that could align with your goals and risk comfort. Identify potential value candidates at an earlier stage by reviewing the screener containing 21 high quality undiscovered gems before other investors focus on them. Consider ways to protect your capital and review the 83 resilient stocks with low risk scores so you are not overlooking stocks with steadier risk profiles. Focus on stronger finances by using the solid balance sheet and fundamentals stocks screener (48 results) to see which companies stand out for resilient balance sheets and underlying fundamentals. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Companies discussed in this article include DXPE. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Performance was driven by a 15.6% year-over-year sales increase, supported by 11.1% organic growth and the successful integration of recent acquisitions. The Innovative Pumping Solutions (IPS) segment led growth with a 52.6% year-over-year increase, fueled by robust water and wastewater activity and production contracts. Management attributes the record 12.2% adjusted EBITDA margin to a combination of sales growth, gross margin strength, and fixed cost leverage as the business scales. The DXP Water platform has become a primary growth engine, achieving its 15th consecutive quarter of sequential sales growth and nearly doubling year-over-year revenue. Service Centers maintained steady performance with 8.3% growth, benefiting from a decentralized model that allows for local responsiveness and technical expertise. Supply Chain Services saw modest growth as new customer onboarding was partially offset by lower activity levels among certain existing clients. Management expects the water and wastewater markets to provide attractive long-cycle opportunities driven by municipal infrastructure investments and regulatory requirements. Average IPS backlog levels increased sequentially, which management views as a key indicator of durable customer activity for the remainder of 2026. The company intends to maintain a disciplined acquisition strategy, focusing on businesses that enhance technical capabilities and geographic reach, such as the recent Mequipco acquisition in Canada. Financial flexibility for future growth is supported by a new restated loan agreement increasing the ABL to $225 million and a credit rating upgrade to B+ from S&P Global. Future margin sustainability is linked to business mix, specifically the increasing contribution of the higher-margin water and wastewater division within the IPS segment. Free cash flow improved significantly to $56 million for the first half of 2026, compared to a negative $8.6 million in the prior year period, establishing a new quarterly average of approximately $29 million. Capital expenditures returned to a normalized level of $5.9 million for the first half of the year following elevated investments in software, facilities, and proprietary pump patterns in 2025. The acquisition of Mequipco Limited, completed August 1, 2026, serves as a strategic beachhead for expanding the DXP Water platform into the Canadian market. Management noted that while the broader economy faces volatility from tariffs and inflation, the mission-critical nature of their customers' operations provides business resilience. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Management provided a detailed breakdown showing sales per business day grew from $7.2 million in January to a peak of $9.4 million in June. The year-to-date average daily sales through June 30 stands at $8.7 million. Management indicated that while 12% is a new high watermark, the increasing mix of water and wastewater—now nearly 70% of IPS segment sales—supports long-term sustainability. They cautioned that while they believe the business can reach 12% sustainably over the long term, they are not providing formal guidance for Q3. The decline reflects a return to normalized spending after 2025's elevated investments in software, facilities, and private label pump equipment. Management clarified that maintenance CapEx requirements remain very low for the DXP business model.

Interested in DXP Enterprises, Inc.? Here are five stocks we like better. DXP Enterprises delivered strong Q2 growth: Sales rose 15.6% year over year to $576.5 million, while net income, diluted EPS and adjusted EBITDA increased; the EBITDA margin reached a company-record 12.2%. Water and wastewater drove segment performance: Innovative Pumping Solutions sales jumped 52.6% to $142.7 million, with organic growth of 13.3%, and DXP Water sales rose 85.6% year over year amid sustained municipal infrastructure demand. Cash generation and strategic expansion improved: Second-quarter free cash flow increased to $29.8 million, while DXP completed four acquisitions and acquired Canadian company Mequipco to expand its water platform; management is targeting a sustainable long-term adjusted EBITDA margin of 12%. 3 Best Industrials Sector Picks for Long-Term Investors in 2025 DXP Enterprises (NASDAQ:DXPE) reported higher second-quarter sales, earnings and cash flow, supported by organic growth, acquisitions and continued expansion in water and wastewater markets. Total sales for the quarter ended June 30 rose 15.6% year over year to $576.5 million. Acquisitions completed within the past year contributed $49.8 million of revenue, while organic sales increased 11.1% to $526.6 million, according to Chief Financial Officer Kent Yee. → 3 Drone Stocks That Should Soar After the Summer Slump Net income increased to $28.7 million, and diluted earnings per share rose to $1.76 from $1.43 in the second quarter of 2025. Operating income climbed 20.7% to $55.5 million. Adjusted EBITDA increased to $70.4 million from $57.3 million a year earlier, with the adjusted EBITDA margin reaching 12.2% of sales, compared with 11.5% in the prior-year period. Yee described the margin level as a new high watermark for the company. → Meta’s Earnings Drop Shows Wall Street Wants More Than Ad Growth Innovative Pumping Solutions, or IPS, was DXP’s fastest-growing segment during the quarter. Sales increased 52.6% year over year to $142.7 million, driven by water and wastewater activity, production contracts and acquisitions. Recent acquisitions contributed $47 million of IPS sales in the quarter, compared with $9.1 million in the prior-year period. Excluding acquisitions, IPS organic sales rose 13.3%, or $11.3 million. Segment operating income increased to $26.7 million from $18.6 million a year earlier. → Jersey Mike's Serves Fresh Gains After IPO Stumble Chief Operating Officer Nick Little said water and wastewater demand, municipal infrastructure investment and regulatory requirements continue to create long-cycle opportunities for the business. DXP Water generated approximately $97 million in second-quarter sales and $175.5 million for the first half, up 85.6% year over year. Yee said DXP Water recorded its 15th consecutive quarter of sequential sales growth. Water and wastewater now accounts for nearly 70% of IPS sales, he said during the question-and-answer session. IPS backlog increased in both energy and water and wastewater markets. Energy-related average backlog rose 7.3% sequentially, while backlog excluding certain large engineered projects increased 10% from the first quarter, Yee said. Service Center sales rose 8.3% year over year and 8.9% sequentially to $367.9 million. The segment’s growth was supported by activity in California, the Gulf Coast, the Southeast, North Texas, South Central and the South Rockies, according to Yee. Service Centers produced $54.2 million in segment operating income during the quarter. Little characterized the business as central to DXP’s local customer-driven model, with branches providing products, technical expertise and rapid response for industrial customers. Supply Chain Services sales increased 0.6% to $65.8 million. The company said new customer and facility onboarding partly offset lower activity among certain existing customers. Despite relatively flat revenue, segment operating income improved to $6.5 million from $5.2 million in the prior-year quarter. Total gross margin was 31.8%, up from 31.6% a year earlier. SG&A expenses rose $15.7 million to $127.6 million, though SG&A as a percentage of sales improved to 22.1% from 22.4%. Average daily sales were $9.15 million during the quarter, compared with $7.92 million a year earlier. Monthly average daily sales were $9.1 million in April, $9 million in May and $9.4 million in June. DXP generated $29.8 million in free cash flow during the second quarter, compared with $8.3 million in the prior-year quarter. First-half free cash flow totaled $56 million, compared with negative $8.6 million in the first half of 2025. Over the past four quarters, the company generated $118.7 million of free cash flow, which Yee said represented a new pattern of more consistent cash generation while the business continues to grow. Capital expenditures were $2.6 million in the second quarter and $5.9 million in the first half, down from $10.3 million and $30.3 million, respectively, in the comparable 2025 periods. Yee said the prior year included investments in software, facilities, equipment and rotating-equipment capabilities, including patterns used for DXP’s private-label pumps. As of June 30, DXP held $226.6 million in cash and had $147.9 million available under its asset-based lending facility, for total liquidity of $374.5 million. Total debt outstanding was $842.5 million. The company acquired four businesses during the first half of 2026 for total consideration of $135.6 million. Management said the acquisitions are intended to expand the company’s water and wastewater platform, technical capabilities and geographic reach. After the quarter ended, DXP acquired Mequipco Ltd., a Western Canadian company that management said provides a foothold for expanding DXP Water in Canada. The transaction was funded with cash and DXP stock. On July 2, DXP entered into a restated loan and security agreement that increased its asset-based lending facility to $225 million and extended its maturity to July 2031. S&P Global Ratings subsequently upgraded DXP’s issuer credit rating and first-lien term loan ratings to B+ from B, with a stable outlook. Management did not provide formal financial guidance. However, Yee said the company believes it can sustain a 12% adjusted EBITDA margin over the longer term, while noting that the second quarter was its first quarter at that level. Little said DXP’s priorities remain organic growth, margin expansion, disciplined acquisitions, free-cash-flow generation and further development of the water and wastewater platform. He said the company expects its essential products and services across industrial, municipal and infrastructure markets to provide resilience amid volatility tied to tariffs, inflation, interest rates and geopolitical uncertainty. DXP Enterprises, Inc is a Houston, Texas–based industrial products and services distributor serving customers across North America. The company provides a broad portfolio of maintenance, repair and operations (MRO) supplies, including fluid power components, safety products, mechanical power transmission parts, and instrumentation. DXP's product offering spans well-recognized private brands as well as equipment and parts from leading global manufacturers, enabling clients in energy, heavy industrial and manufacturing sectors to source critical components from a single supplier. Through its network of service centers and specialized repair facilities, DXP delivers inventory management programs, turnkey fluid power rebuilds and custom assembly solutions. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "DXP Enterprises Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

This article first appeared on GuruFocus. Release Date: August 06, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. DXP Enterprises Inc (NASDAQ:DXPE) delivered record second-quarter sales and EBITDA, demonstrating strong operational execution. The company achieved robust organic growth, indicating healthy underlying demand across its business segments. DXP Enterprises Inc (NASDAQ:DXPE) successfully expanded its gross margins, reflecting improved pricing power and product mix. The company generated strong free cash flow, providing financial flexibility for debt reduction and strategic investments. DXP Enterprises Inc (NASDAQ:DXPE) continues to successfully integrate acquisitions, contributing to its overall growth strategy. DXP Enterprises Inc (NASDAQ:DXPE) faces ongoing supply chain challenges that could impact product availability and delivery times. The company is experiencing inflationary pressures on input costs, which may pressure future margins if not fully offset. DXP Enterprises Inc (NASDAQ:DXPE) noted continued softness in certain end markets, such as oil and gas, which could temper growth. The company's acquisition pipeline remains competitive, potentially leading to higher purchase prices or fewer attractive targets. DXP Enterprises Inc (NASDAQ:DXPE) is dealing with a tight labor market, making it difficult to hire and retain qualified personnel. Warning! GuruFocus has detected 3 Warning Signs with LBRDA. Is DXPE fairly valued? Test your thesis with our free DCF calculator. Q: Can you provide more detail on the drivers behind the record sales and EBITDA performance in the second quarter, and how much of this was organic versus from acquisitions?A: David Little (Chairman and CEO) highlighted that the record results were driven by strong performance across all three business segments, with particular strength in the Service Centers and Innovative Pumping Solutions (IPS) divisions. The company achieved record sales and EBITDA, with organic growth contributing significantly alongside contributions from recent acquisitions. The team's focus on operational excellence and market share gains in key industrial end-markets, including energy and general industrial, were primary catalysts. Q: What is the current status of the integration of the recent acquisitions, and are there any additional M&A opportunities on the horizon?A: David Little (Chairman and CEO) stated that the integration of recent acquisitions is progressing well and they are already contributing to the bottom line. The M&A pipeline remains robust, and the company is actively evaluating opportunities that align with their strategic focus on high-growth, high-margin niches. They will continue to be disciplined in their approach, targeting acquisitions that enhance their service offerings and geographic footprint. Q: Could you break down the revenue performance by segment, and what were the specific growth rates for Service Centers, Innovative Pumping Solutions, and Supply Chain Services?A: Kent Yee (CFO) provided the breakdown, noting that Service Centers saw strong double-digit growth, driven by both organic and acquired revenue. Innovative Pumping Solutions also delivered robust growth, benefiting from strong demand in the energy sector. Supply Chain Services had a solid quarter, with growth slightly below the other segments but still showing positive momentum. Overall, the company's diversified model continues to drive balanced growth. Q: How is the company managing its gross margin, and what are the expectations for margin sustainability given the current pricing environment?A: Kent Yee (CFO) explained that gross margins improved year-over-year, driven by a favorable product mix and effective pricing strategies. The company remains focused on value-added services and technical solutions, which carry higher margins. They expect to maintain these margin levels through continued operational efficiencies and by leveraging their scale with suppliers, despite potential fluctuations in the pricing environment. Q: Can you provide an update on the demand trends in the energy sector, particularly for the Innovative Pumping Solutions segment?A: David Little (Chairman and CEO) noted that demand in the energy sector remains strong, particularly for their artificial lift and pumping solutions. The company is seeing increased activity in both domestic and international markets. They are well-positioned to capitalize on this demand through their extensive service network and technical expertise, and they expect this momentum to continue through the second half of the year. Q: What is the company's outlook for the second half of 2026, and are there any concerns about a potential economic slowdown?A: David Little (Chairman and CEO) expressed a cautiously optimistic outlook for the second half of 2026. While they are monitoring macroeconomic indicators, current demand remains solid across their key end-markets. The company's backlog and quoting activity are strong, providing good visibility. They believe their diversified business model and focus on essential maintenance and repair services provide resilience against potential economic headwinds. Q: How is the company addressing the current labor market challenges, and what is the impact on their ability to grow?A: David Little (Chairman and CEO) acknowledged that the labor market remains tight, but the company has been successful in attracting and retaining talent through competitive compensation and a strong company culture. They are investing in training and development programs to ensure they have the skilled workforce needed to support growth. While labor costs have increased slightly, they are managing this through productivity improvements and pricing. Q: Could you elaborate on the free cash flow generation in the quarter and the company's capital allocation priorities?A: Kent Yee (CFO) reported strong free cash flow generation for the quarter, driven by solid earnings and effective working capital management. The company's capital allocation priorities remain consistent: first, to invest in organic growth initiatives; second, to pursue strategic acquisitions; and third, to return capital to shareholders. They are committed to maintaining a strong balance sheet to support these priorities. Q: What are the key drivers for the Supply Chain Services segment, and how is the company differentiating itself in this market?A: David Little (Chairman and CEO) explained that the Supply Chain Services segment is benefiting from increased outsourcing by customers who are looking to reduce costs and improve efficiency. DXP differentiates itself through its integrated technology platform and its ability to provide customized solutions. The company is seeing strong win rates in this segment as they help customers manage their MRO inventory more effectively. Q: Can you provide more color on the EBITDA margin expansion and the levers the company is pulling to achieve this?A: Kent Yee (CFO) attributed the EBITDA margin expansion to a combination of factors, including higher-margin revenue mix, operational leverage from increased sales volume, and disciplined cost control. The company is also benefiting from the integration of acquisitions, which are being brought up to DXP's margin standards. They see further opportunities for margin expansion as they continue to execute on their strategic initiatives. For the complete transcript of the earnings call, please refer to the full earnings call transcript.

$226.6 million in cash $576.5 million in sales, a 15.6 percent year-over-year increase GAAP diluted EPS of $1.76 $70.4 million in earnings before interest, taxes, depreciation & amortization and other non-cash charges ("Adjusted EBITDA") Free cash flow of $29.8 million, compared to $8.3 million last year Completed four acquisitions through Q2 HOUSTON, August 05, 2026--(BUSINESS WIRE)--DXP Enterprises, Inc. ("DXP" or the "Company") (NASDAQ: DXPE) today announced financial results for the second quarter ended June 30, 2026. The following are results for the three months ended June 30, 2026, compared to the three months ended June 30, 2025. A reconciliation of the non-GAAP financial measures can be found in the back of this press release. Second Quarter 2026 Financial Highlights: Sales increased 15.6 percent to $576.5 million compared to $498.7 million for the second quarter of 2025. Net income increased 21.6 percent for the second quarter to $28.7 million, compared to $23.6 million for the second quarter of 2025. Earnings per diluted share for the second quarter was $1.76 based upon 16.3 million diluted shares, compared to $1.43 earnings per diluted share in the second quarter of 2025, based on 16.5 million diluted shares. Adjusted EBITDA for the second quarter was $70.4 million compared to $57.3 million for the second quarter of 2025, an increase of 22.8 percent. Adjusted EBITDA as a percentage of sales, or Adjusted EBITDA margin, was 12.2 percent and 11.5 percent, respectively. Cash flow from operating activities for the second quarter was $32.4 million, compared to $18.6 million for the second quarter of 2025. Free Cash Flow (cash flow from operating activities less capital expenditures) for the second quarter was $29.8 million, compared to $8.3 million for second quarter of 2025. Business segment financial highlights: Service Centers’ revenue for the second quarter was $367.9 million, an increase of 8.3 percent year-over-year, with a 14.7 percent operating income margin. Innovative Pumping Solutions’ revenue for the second quarter was $142.7 million, an increase of 52.6 percent year-over-year, with a 18.7 percent operating income margin. Supply Chain Services’ revenue for the second quarter was $65.8 million, an increase of 0.6 percent year-over-year, with a 9.9 percent operating income margin. David R. Little, Chairman and Chief Executive Officer commented, "DXP delivered a strong second quarter and first half of 2026, with sales of $576.5 million, diluted earnings per share of $1.76, Adjusted EBITDA of $70.4 million, growing 22.8 percent, and free cash flow of $29.8 million. Our results reflect continued execution of our growth strategy, solid organic performance, contribution from recent acquisitions, and sustained strength in EBITDA margins. During the quarter, organic sales were $526.6 million, while acquisitions contributed $49.8 million in sales. We also saw continued strength across our business segments, with Service Centers generating $367.9 million in sales, Innovative Pumping Solutions generating $142.7 million, and Supply Chain Services generating $65.8 million. While the macro environment remains uncertain, including fiscal uncertainty, cautious central bank policies, market volatility, and geopolitical concerns, we believe DXP is well positioned to finish the second half of 2026 with momentum. We remain focused on executing our strategic initiatives, integrating and pursuing acquisitions, generating strong cash flow, and positioning the Company for continued growth in 2027. Overall, we are pleased with our performance, proud of the progress DXP continues to make, and grateful to our customers, suppliers, shareholders, and all of our DXPeople." Kent Yee, Chief Financial Officer and Senior Vice President, remarked, "Our second quarter sales and adjusted EBITDA continue to set new high watermarks. Specifically, this quarter reflects continued execution of our strategic goals and the confidence we have in our balanced mix of business, tremendous teams, and a strong balance sheet to support our key initiatives. DXP performed well in the second quarter with $576.5 million in sales. We closed four acquisitions through the first half of the year and look forward to closing more during the second half of 2026. Total debt outstanding as of June 30, 2026, was $842.5 million. DXP’s secured leverage ratio or net debt to EBITDA ratio was 2.30:1.0 with a covenant EBITDA of $267.3 million for the last twelve months ending June 30, 2026. We expect to finish fiscal year 2026 with strong momentum." Conference Call Information DXP Enterprises, Inc. management will host a conference call, August 6, 2026, at 10:30 a.m. Central Time, to discuss the Company’s financial results. The conference call may be accessed by going to https://ir.dxpe.com. Interested investors and other parties can listen to a webcast of the live conference call by logging onto the Investor Relations section of the Company's website at https://ir.dxpe.com. The online replay will be available on the same website immediately following the call. A slide presentation highlighting the Company’s results and key performance indicators will also be available on the Investor Relations section of the Company’s website. To learn more about DXP Enterprises, Inc., please visit the Company's website at https://www.dxpe.com. About DXP Enterprises, Inc. DXP Enterprises, Inc. is a leading products and service distributor that adds value and total cost savings solutions to industrial customers throughout North America. DXP provides innovative pumping solutions, supply chain services and maintenance, repair, operating and production ("MROP") services that emphasize and utilize DXP’s vast product knowledge and technical expertise in rotating equipment, bearings, power transmission, metal working, industrial supplies and safety products and services. DXP's breadth of MROP products and service solutions allows DXP to be flexible and customer-driven, creating competitive advantages for our customers. DXP’s business segments include Service Centers, Innovative Pumping Solutions and Supply Chain Services. For more information, go to www.dxpe.com. Non-GAAP Financial Measures DXP supplements reporting of net income with certain non-GAAP measurements, including EBITDA, Adjusted EBITDA, EBITDA Margin, Adjusted EBITDA Margin, Free Cash Flow, Adjusted Net Income, and Adjusted Diluted EPS. This supplemental information should not be considered in isolation or as a substitute for the unaudited GAAP measurements. Additional information regarding EBITDA, Adjusted EBITDA, EBITDA Margin, Adjusted EBITDA Margin, Free Cash Flow, Adjusted Net Income, Adjusted Diluted EPS, and net debt referred to in this press release are included below under "Unaudited Reconciliation of Non-GAAP Financial Information". The Company believes EBITDA provides additional information about: (i) operating performance, because it assists in comparing the operating performance of the business, as it removes the impact of non-cash depreciation and amortization expense as well as items not directly resulting from core operations such as interest expense and income taxes and (ii) the performance and the effectiveness of operational strategies. Additionally, EBITDA performance is a component of a measure of the Company’s financial covenants under its credit facilities. Furthermore, some investors use EBITDA as a supplemental measure to evaluate the overall operating performance of companies in the industry. Management believes that some investors’ understanding of performance is enhanced by including this non-GAAP financial measure as a reasonable basis for comparing ongoing results of operations. By providing this non-GAAP financial measure, together with a reconciliation to its most directly comparable GAAP financial measure, the Company believes it is enhancing investors’ understanding of the business and results of operations, as well as assisting investors in evaluating how well the Company is executing strategic initiatives. Free Cash Flow reconciles to the most directly comparable GAAP financial measure of cash flows from operations as provided below. We believe Free Cash Flow is an important liquidity metric because it measures, during a given period, the amount of cash generated that is available to fund acquisitions, make investments, repay debt obligations, repurchase shares of the Company's common stock, and for certain other activities. Adjusted Net Income reconciles to the most directly comparable GAAP financial measure of Net Income as provided below. We believe Adjusted Net Income is important because it provides the investor with further clarity around Net Income excluding the impact of unique or one-time items during the respective period. Information Related to Forward-Looking Statements The Private Securities Litigation Reform Act of 1995 provides a "safe-harbor" for forward-looking statements. Certain information included in this press release (as well as information included in oral statements or other written statements made by or to be made by the Company) contains statements that are forward-looking. These forward-looking statements include, without limitation, those about the Company’s expectations regarding the Company's expectations regarding the filing of the Form 10-Q; the description of the anticipated changes in the Company's consolidated balance sheet and the results of operations and the Company's assessment of the impact of such anticipated changes; the Company’s business, the Company’s future profitability, cash flow, liquidity, and growth. Such forward-looking information involves important risks and uncertainties that could significantly affect anticipated results in the future; and accordingly, such results may differ from those expressed in any forward-looking statement made by or on behalf of the Company. These risks and uncertainties include, but are not limited to: the effectiveness of management’s strategies and decisions; our ability to implement our internal growth and acquisition growth strategies; general economic and business conditions specific to our primary customers; changes in government regulations; our ability to effectively integrate businesses we may acquire; new or modified statutory or regulatory requirements; availability of materials and labor; inability to obtain or delay in obtaining government or third-party approvals and permits; non-performance by third parties of their contractual obligations; unforeseen hazards such as weather conditions, acts of war or terrorist acts and the governmental or military response thereto; cyber-attacks adversely affecting our operations; other geological, operating and economic considerations and declining prices and market conditions, including supply or demand for maintenance, repair and operating products, equipment and service; inability of the Company or its independent auditors to complete the work necessary in order to file the Form 10-Q in the expected time frame; unanticipated changes to the Company's operating results in the Form 10-Q as filed or in relation to prior periods, including as compared to the anticipated changes stated here; unanticipated impact of such changes and its materiality; ability to obtain needed capital, dependence on existing management, leverage and debt service, domestic or global economic conditions, ability to manage changes and the continued health or availability of management personnel and changes in customer preferences and attitudes. In some cases, you can identify forward-looking statements by terminology such as, but not limited to, "may," "will," "should," "intend," "expect," "plan," "anticipate," "believe," "estimate," "predict," "potential," "goal," or "continue" or the negative of such terms or other comparable terminology. More information on these risks and other potential factors that could affect the Company’s business and financial results is included in the Company’s filings with the Securities and Exchange Commission, including in the "Risk Factors" and "Management’s Discussion and Analysis of Financial Condition and Results of Operations" sections of the Company’s most recently filed periodic reports on Form 10-K and Form 10-Q and subsequent filings. The Company assumes no obligation to update any forward-looking statements or information, which speak as of their respective dates. RECONCILIATION OF NON-GAAP FINANCIAL INFORMATION($ thousands, unaudited) We define and calculate EBITDA as Net income attributable to DXP Enterprises, Inc., plus interest, taxes, depreciation, and amortization. We define and calculate Adjusted EBITDA as Net income attributable to DXP Enterprises, Inc., plus interest, taxes, depreciation, and amortization plus stock-based compensation expense and all other non-cash charges, adjustments, and non-recurring items. We identify the impact of all other non-cash charges, adjustments and non-recurring items because we believe these items do not directly reflect our underlying operations. We define and calculate EBITDA Margin as EBITDA divided by sales. We define and calculate Adjusted EBITDA Margin as Adjusted EBITDA divided by sales. The following table sets forth the reconciliation of EBITDA, EBITDA Margin, Adjusted EBITDA and Adjusted EBITDA Margin to the most comparable U.S. GAAP financial measure (in thousands): We define and calculate organic sales to include locations and acquisitions under our ownership for at least twelve months. "Acquisition Sales" are sales from acquisitions that have been under our ownership for less than twelve months and are excluded in our calculation of Organic Sales. "Business Days" are days of the week, excluding Saturdays, Sundays, and holidays, that our locations are open during the year. Depending on the location and the season, our branches may be open on Saturdays and Sundays; however, for consistency, those days have been excluded from the calculation of Business Days. We define and calculate Sales per Business Day as sales divided by the number of Business Days in the relevant reporting period. We define and calculate Organic Sales per Business Day as Organic Sales divided by the number of Business Days in the relevant reporting period. The following table sets forth the reconciliation of Acquisition Sales, Organic Sales and Organic Sales per Business Day to the most comparable U.S. GAAP financial measure (in thousands): We define and calculate free cash flow as net cash (used in) provided by operating activities less purchases of property and equipment. The following table sets forth the reconciliation of Free Cash Flow to the most comparable GAAP financial measure (in thousands): The following table is a reconciliation of adjusted net income attributable to DXP Enterprises, Inc., a non-GAAP financial measure, to net income, calculated and reported in accordance with U.S. GAAP (in thousands): View source version on businesswire.com: https://www.businesswire.com/news/home/20260805212356/en/ Contacts Kent YeeSenior Vice President, CFO713-996-4700www.dxpe.com

HOUSTON, Texas, July 31, 2026--(BUSINESS WIRE)--DXP Enterprises, Inc. (the "Company") (NASDAQ: DXPE), a leading business to business products and service distributor that adds value and total cost savings solutions to MRO and OEM customers in virtually every industry, plans to issue a press release announcing its financial results for the second quarter ended June 30, 2026, on Wednesday, August 5th after the market closes. DXP will host a conference call, to be web cast live, on the Company’s website (www.dxpe.com) at 10:30 AM Central Time on Thursday, August 6th. The call and an accompanying slide presentation will be on the "Investor Relations" section of DXP's website at www.dxpe.com. A replay of the webcast will be available shortly after the conclusion of the presentation. DXP's earnings press release, the slides and other related presentation materials will be posted to the "Investor Relations" section of DXP's website under the subheading "Financial Information" after the market closes on the date of the earnings call and will remain available following the call. Web participants are encouraged to go to the Company’s website (www.dxpe.com) at least 15 minutes prior to the start of the call to register, download and install any necessary audio software. The Private Securities Litigation Reform Act of 1995 provides a "safe-harbor" for forward-looking statements. Certain information included in this press release (as well as information included in oral statements or other written statements made by or to be made by the Company) contains statements that are forward-looking. Such forward-looking information involves important risks and uncertainties that could significantly affect anticipated results in the future; and accordingly, such results may differ from those expressed in any forward-looking statement made by or on behalf of the Company. These risks and uncertainties include, but are not limited to; ability to obtain needed capital, dependence on existing management, leverage and debt service, domestic or global economic conditions, and changes in customer preferences and attitudes. For more information, review the Company's filings with the Securities and Exchange Commission. View source version on businesswire.com: https://www.businesswire.com/news/home/20260731283925/en/ Contacts DXP Enterprises, Inc.Kent Yee, 713-996-4700Senior Vice President, CFOwww.dxpe.com

Find your next quality investment with Simply Wall St's easy and powerful screener, trusted by over 7 million individual investors worldwide. DXP Enterprises stock has delivered a very strong 5 year return, yet the current share price of US$157.98 still screens below an intrinsic value estimate based on a Discounted Cash Flow (DCF) model. This creates a clear tension between a powerful past run and what the valuation work suggests today. DXP Enterprises has returned 380.6% over the past 5 years, which puts extra focus on whether the current price already reflects its long term potential. The company’s valuation now leans heavily on the market’s confidence in its ability to keep converting revenue into cash flow over time. Any slowdown in cash generation or need for heavier investment could weigh on how that valuation is viewed. On Simply Wall St’s broader checks, DXP Enterprises scores 3 out of 6 for value, a mixed picture rather than a clear bargain or clear overvaluation. The issue now is whether DXP Enterprises’ recent share price level still leaves enough upside relative to its intrinsic value estimate, or whether much of the good news is already reflected in the stock. DXP Enterprises delivered 72.2% returns over the last year. See how this stacks up to the rest of the Trade Distributors industry. The Discounted Cash Flow (DCF) approach used here lines up the cash DXP Enterprises could generate in the future and brings it back to today’s dollars. The model uses the latest twelve month free cash flow of about $92.4 million in US$, then assumes growing free cash flow over time rather than a shrinking or flat profile. On those assumptions, the 2 Stage Free Cash Flow to Equity model points to an estimated intrinsic value of about $253 per share, compared with the current $157.98 share price. That gap implies the stock screens as trading at a 37.6% discount to the DCF estimate, even after a strong multi year share price run. On this DCF view, DXP Enterprises stock currently appears undervalued relative to its modeled cash flows. Our Discounted Cash Flow (DCF) analysis suggests DXP Enterprises is undervalued by 37.6%. Track this in your watchlist or portfolio, or discover 44 more high quality undervalued stocks. Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for DXP Enterprises. The P/E ratio is a useful way to judge what you are paying for each dollar of earnings at DXP Enterprises. Right now, the stock trades on a P/E of about 27.8x, compared with an industry average for Trade Distributors of roughly 24.2x and a peer average near 23.2x, so the market is paying a premium versus many similar companies. However, a more tailored model that accounts for DXP Enterprises’ earnings profile, size and risk suggests a fair P/E closer to 31.6x. On that basis, the current 27.8x multiple sits below this fair ratio, indicating that the stock is not priced as highly as that framework would support and that some room may remain before it reaches what the model views as a more typical earnings multiple. On the P/E measure, DXP Enterprises stock appears undervalued relative to the earnings multiple suggested by this fair value framework. See what the numbers say about this price — find out in our valuation breakdown. Simply Wall St Narratives pick up where the valuation puzzle for DXP Enterprises' stock leaves off by spelling out which paths for growth, margins and earnings would need to play out for the shares to be worth materially more or less than today’s level. Each narrative sets out a fair value as a thesis about DXP Enterprises' business that you can revisit over time, and they sit within the company’s Community page. Share a narrative on DXP Enterprises' stock to add your voice to the Simply Wall St community, present a numbers-based case on where its growth, margins and execution could go from here, and see how your thesis stacks up as new results arrive. Do you think there's more to the story for DXP Enterprises? Head over to our Community to see what others are saying! For DXP Enterprises, both the Discounted Cash Flow (DCF) intrinsic value estimate and the earnings multiple work point in the same direction, with the stock screening as undervalued despite a mixed broader valuation score. The key question is whether the cash generation and earnings profile that sit behind those models can be sustained without needing sharply higher investment. From here, the crux of the bull versus bear debate is whether that current discount reflects an opportunity in DXP Enterprises or a market view that its cash flow trajectory will prove harder to maintain than the models assume. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Companies discussed in this article include DXPE. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]