SITE

Get insights on thousands of stocks from the global community of over 7 million individual investors at Simply Wall St. SiteOne Landscape Supply (SITE) put acquisitions and capital returns in focus in its late July earnings update, pairing new deals and an expanded pipeline with progress on its multi year share repurchase program. See our latest analysis for SiteOne Landscape Supply. The latest acquisition updates and earnings strength came alongside a sharp move in SiteOne Landscape Supply's share price. The stock delivered a 1-day share price return of 5.42% and a 7-day share price return of 9.97% after the July earnings. This comes even though the year-to-date share price return is down 16.95% and the 1-year total shareholder return is down 21.5%. This points to short-term momentum building against a weaker multi-year total shareholder return profile, including a 5-year total shareholder return decline of 47.98% from the current share price of $103.86. If you are weighing SiteOne Landscape Supply against other ideas in your watchlist, this is a handy moment to broaden your search with the 20 top founder-led companies The recent bounce in SiteOne Landscape Supply raises a simple question. Are investors reacting to improving earnings and buybacks, or is sentiment just snapping back after a steep multi year slide in the stock price? At a last close of $103.86 versus a narrative fair value of $160.73, SiteOne Landscape Supply is framed as materially mispriced, with that gap resting on detailed long term earnings and margin assumptions. Read the complete narrative. Want to see what underpins that fair value gap? The story is based on steady revenue compounding, rising profit margins, and a richer earnings multiple several years out. Curious which specific projections drive that outcome? The full narrative lays out the step by step path behind those numbers. Result: Fair Value of $160.73 (UNDERVALUED) Have a read of the narrative in full and understand what's behind the forecasts. However, SiteOne Landscape Supply still faces key risks, including dependence on acquisitions for growth and exposure to cyclical construction and repair markets that could pressure margins and earnings. Find out about the key risks to this SiteOne Landscape Supply narrative. The narrative fair value of $160.73 presents SiteOne Landscape Supply as meaningfully undervalued. The SWS DCF model is more restrained. It puts fair value at $119.49, which is still above the current $103.86 share price but suggests a smaller margin of error. Which perspective do you think better matches your expectations for the business over time? Look into how the SWS DCF model arrives at its fair value. With sentiment on SiteOne Landscape Supply split between recent share price weakness and a richer long term narrative, this is a useful moment to move quickly and review the details yourself. To see why some investors are optimistic about the company, start by checking the 4 key rewards If SiteOne Landscape Supply is already on your radar, do not stop there. Use this moment to line up a few more high quality ideas on your watchlist. Target more quality for every dollar you invest by scanning companies that currently screen as attractively priced using the 51 high quality undervalued stocks. Build a portfolio that works harder for your income goals by reviewing the 8 dividend fortresses and focusing on resilient yield potential. Protect your capital during tougher markets by focusing on companies with stronger finances through the 79 resilient stocks with low risk scores. 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 SITE. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]

Image source: The Motley Fool. Wed, July 29, 2026 at 8:00 a.m. ET Chairman and Chief Executive Officer - Doug Black Chief Financial Officer - Eric Elema SVP, Strategy and Development - Daniel Laughlin Operator: Greetings, and welcome to the SiteOne Landscape Supply Second Quarter 2026 Earnings Call. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce Eric Elema, Chief Financial Officer. Thank you. You may begin. Eric Elema: Thank you, and good morning, everyone. We issued our second quarter 2026 earnings press release this morning and posted a slide presentation to the Investor Relations portion of our website at investors.siteone.com. I am joined today by Doug Black, our Chairman and Chief Executive Officer; and Daniel Laughlin, SVP, Strategy and Development. Before we begin, I'd like to remind everyone that today's press release, slide presentation and the statements made during this call include forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are subject to risks and uncertainties that could cause actual results to differ materially from our expectations and projections. Such risks and uncertainties include the factors set forth in the earnings release and in our filings with the Securities and Exchange Commission. Additionally, during today's call, we will discuss non-GAAP measures which we believe can be useful in evaluating our performance. A reconciliation of these measures can be found in our earnings release and in the slide presentation. I would now like to turn the call over to Doug Black. Doug Black: Thank you, Eric. Good morning, and thank you for joining us today. We delivered a solid second quarter performance with 5% growth in net sales and adjusted EBITDA, 8% growth in net income and strong cash flow despite softer end markets. Our teams executed well throughout the quarter, driving our commercial and operational initiatives while continuing to manage our SG&A spending tightly. We also took advantage of our strong cash flow and recent share price weakness and returned over $100 million to shareholders through our share repurchase program while maintaining a strong balance sheet to invest in our business and pursue attractive acquisition opportunities. While market conditions remain challenging, we continue to focus on serving our customers, gaining market share, expanding our EBITDA margin and strengthening the business to drive future performance and growth. Our acquisitions are performing well, and we have an active pipeline of opportunities, which we expect will result in more acquisitions during the remainder of the year. Overall, we remain confident in the long-term opportunity ahead of us and believe our strategy, competitive position and execution capabilities will continue to differentiate SiteOne in the market. I will start today's call with a brief overview of our unique market position and our strategy, followed by highlights from the second quarter. Eric will then walk you through our second quarter financial results in more detail and provide an update on our balance sheet and liquidity position. Daniel will discuss our acquisition strategy, and then I will come back to address our outlook and guidance for 2026 before taking your questions. As shown on Slide 4 of the earnings presentation, we have a strong footprint of more than 680 branches and five distribution centers across 45 U.S. states and five Canadian provinces. We are the clear industry leader, approximately 3x the size of our nearest competitor, yet we estimate that we only have about a 13% share of the very fragmented $36 billion wholesale landscaping products distribution market. Note that the $36 billion total addressable market is a significant increase from the previous $25 billion estimate as it includes important adjacent product categories that we have entered over the past 5 years. Accordingly, our long-term opportunity to grow and gain market share remains significant. We have a balanced mix of business with 66% focused on maintenance, repair and upgrade, 20% focused on new residential construction and 14% on new commercial and recreational construction. As the only nationwide full product line wholesale distributor in the market, we also have an excellent balance across our product lines as well as geographically. Our strategy to fill in our product lines across the U.S. and Canada, both organically and through acquisition, further strengthens this balance over time. Overall, our end market mix broad product portfolio and geographic coverage offers us multiple avenues to grow and create value for our customers and suppliers while providing important resiliency in softer markets, like the market we are in today. Turning to Slide 5. Our strategy remains straightforward and unchanged. Leverage the strengths of both a large nationwide organization and our very experienced and highly entrepreneurial local teams. Our goal is to fully utilize our scale, resources and capabilities in support of local execution to deliver superior value to our customers and suppliers in every market that we serve. We do this through our focused commercial and operational initiatives which not only build a long-term competitive advantage for all our stakeholders but also help us overcome the near-term headwinds. These initiatives are complemented by our acquisition strategy, which fills in our product portfolio, moves us into new geographic markets and adds terrific new talent to SiteOne. Taken all together, we expect our strategy to create superior value for our shareholders through organic growth, acquisition growth and EBITDA margin expansion. At our Investor Day in June, we described our strategy and initiatives in detail and outline our financial targets through 2030. The current challenging end markets, the execution of our strategy, we believe, allows us to outperform the market organically while leveraging acquisition growth and EBITDA margin expansion to deliver solid financial progress. We expect our progress to accelerate as end markets return to normal growth. Accordingly, we remain highly focused on executing our commercial and operational initiatives, strengthening the business and continuously improving areas that are within our control. On Slide 6, you can see our strong track record over the last 10 years with consistent organic and acquisition growth. As mentioned, we expect to continue driving organic and acquisition growth while recovering and expanding our EBITDA margin significantly over the coming years. Our ability to deliver EBITDA margin expansion in both soft and healthy market conditions, is expected to yield attractive EBITDA growth and improve return on invested capital in the coming years. Finally, with our strong cash flow, we can support our strategy and return capital to shareholders through our share repurchase program. Overall, we are well positioned to create solid value for our shareholders in 2026 and significant value over the longer term. We have completed 108 acquisitions across all product lines since the start of 2014, adding approximately $2.2 billion in trailing 12-month sales to SiteOne which demonstrates the strength and durability of our acquisition strategy. Our pipeline of potential deals remains robust, and we expect to continue adding and integrating more companies in 2026 to support our growth. Given the fragmented nature of our industry and our current market share, we believe that we can add over $2 billion of acquired trailing 12 months revenue to SiteOne over the next 10 years. Slide 7 shows the long runway that we have ahead in filling in our product portfolio, which we aim to do primarily through acquisition, especially in the nursery, hardscapes and landscape supplies categories. We are well connected with the best companies in our industry and expect to continue filling in these markets systematically over the next decade. I will now discuss some of our second quarter performance highlights as shown on Slide 8. Net sales increased 5% to $1.53 billion during the quarter with 1% organic daily sales growth and 3% sales growth added through acquisitions. We believe that new residential landscaping demand is down high single digits, and demand in repair and upgrade is down mid-single digits this year, reflecting the decline in new home completions and ongoing macroeconomic uncertainty. Additionally, we believe that end market demand for maintenance products has been negatively impacted in the short term by the recent significant price increases as customers adjust to meet fixed budgets. Accordingly, even though we believe that we are outperforming the market through our commercial initiatives, we were unable to fully offset end market declines, resulting in a 2% decline and sales volume during the quarter. Pricing increased by 3% year-over-year during the quarter, yielding the 1% organic daily sales growth. Gross profit increased 6% to approximately $565 million, and gross margin improved 50 basis points to 36.9%. The improvement reflects increased price realization, along with execution of our commercial initiatives, including continued strong growth in private brands and with small customers, and excellent management of fuel surcharges in response to higher delivery expense. SG&A as a percentage of net sales increased 30 basis points during the quarter as our operational initiatives and tight management of spending were more than offset by higher fuel cost, increased health care expenses and ongoing cost inflation. Given the market weakness, we are taking additional actions during the remainder of the year, which we expect will achieve approximately flat SG&A as a percentage of net sales for the year. Adjusted EBITDA increased 5% to $237.2 million, and adjusted EBITDA margin was maintained at 15.5%. Year-to-date, we have improved adjusted EBITDA margin by 20 basis points, and we expect to continue expanding adjusted EBITDA margin in the second half and for the full year 2026 despite the softer markets. In terms of initiatives, we continue to make solid progress during the quarter despite the lower end market demand, executing specific actions to improve our customer experience, drive organic sales growth, expand gross margin and manage SG&A. For organic growth and gross margin expansion, we achieved good organic daily sales growth with our small customers and grew our Pro-Trade Solstice and portfolio of private brand products collectively by 40% during the quarter. A percentage of branches with bilingual capability is nearly 70% despite adding 12 Reinders branches without this capability, continue to execute our Hispanic marketing strategy to drive growth in this important customer segment. We increased our digital sales on siteone.com by over 50% year-to-date versus the prior year period, while also increasing our regular active users by approximately 40%. We believe we are gaining market share with the customers who are engaged with us digitally as we achieved strong positive total sales growth with these customers during the quarter. siteone.com helps customers to be more efficient, helps us to increase market share while making our associates more productive, a true win-win-win. On the SG&A front, we continued to lower our net delivery expense during the second quarter as a result of increased efficiency along with improved pricing. As mentioned, our teams have done a good job of working with our customers to pass through fuel surcharges to mitigate the significant near-term increases in fuel costs. We expect to reduce net delivery expense in 2026 and for the next several years as we execute our local market delivery strategy and best practices. We also continue to achieve improved profitability with our underperforming branches or focused branches during the quarter, though they were also negatively affected by low organic daily sales growth. We expect to drive steady improvement with these branches in 2026, which should accelerate with more normal end market demand in the coming years. In total, our ability to execute our commercial and operational initiatives, we believe enables us to outperform the market and deliver EBITDA margin expansion despite lower end market demand. Furthermore, we expect these initiatives to help us drive organic growth and expand our adjusted EBITDA margin over the next several years towards our 2030 targets. On the acquisition front, we have added two companies to our family so far in 2026 with approximately $110 million in trailing 12-month sales, including Reinders, a strong market leader in the Midwest for irrigation, agronomics and lighting products. We have an active pipeline of additional companies, and we expect to close more acquisitions during the remainder of the year. An experienced acquisition team, broad and deep relationships with the best companies, a strong balance sheet and an exceptional reputation as the acquirer of choice. We remain well positioned to grow consistently through acquisition for many years in the very fragmented wholesale landscape supply distribution market. Now Eric will walk you through the quarter in more detail. Eric? Eric Elema: Thanks, Doug. I'll begin on Slide 9 with some highlights of our second quarter results. Net sales increased 5% to approximately $1.53 billion during the quarter compared to approximately $1.46 billion for the prior year period. Organic daily sales increased 1%, driven by price inflation in response to rising costs and the benefit of our commercial initiatives, partially offset by softer end markets. Acquisition sales, which include sales attributable to acquisitions completed in 2025 and 2026, contributed approximately $49 million or 3% to net sales growth during the quarter. From a demand perspective, as Doug mentioned, we continue to experience challenging conditions in our end markets. Organic volume declined approximately 2% during the quarter due to weakness in the new residential construction and repair and upgrade end markets. Pricing contributed approximately 3% during the quarter which was generally in line with our expectations coming out of the first quarter. The year-over-year price increases reflect supply dynamics and higher transportation costs. In addition, we benefited from the tariff-related price increases that were implemented in 2025. Pricing was positive for most of our product categories and more than offset the deflationary impacts of grass seed and PVC pipe where prices were down by 9% and 4%, respectively, for the quarter. For the full year, we expect pricing to contribute approximately 3% to our results. While pricing was solid in the second quarter, there remains a high degree of uncertainty for the rest of the year given the ongoing disruption in the Middle East and related volatility in commodities. In addition, we lapped the 2025 tariff-related price increases for the remainder of the year. Consequently, we believe pricing is more likely to track near 3% in the second half of the year, rather than accelerate meaningfully from current levels. From a regional perspective, performance varied significantly by market. The Central region continues to be our strongest performer achieving double-digit organic growth for the second quarter following the same result for the first quarter. However, the Sunbelt remained challenged, particularly California, Arizona and Texas, where organic sales were down due to weaker demand in the new residential construction and repair and upgrade end markets. Texas also experienced a meaningful amount of rain during the second quarter. Although weather did not have a broad negative impact on our overall sales performance for the quarter. Organic daily sales for agronomic products which include fertilizer and control products, ice melt and equipment, increased 5% for the second quarter due to price inflation resulting from rising product costs. Agronomic volume growth was 1% for the quarter against a difficult comparison to the prior year period. We believe the higher prices for certain agronomic products like fertilizer have also reduced short-term volume as our customers deal with fixed maintenance budgets. Organic daily sales for landscaping products, which include irrigation, nursery, hardscapes, outdoor lighting and landscape accessories, were flat in the second quarter compared to the prior year period reflecting weakness in new residential construction in softer repair and upgrade activity. Gross profit increased 6% to approximately $565 million and gross margin improved 50 basis points to 36.9% during the quarter. The improvement was driven by price realization and execution of our commercial initiatives including continued private brand and small customer growth. Pro-Trade Private brand sales increased nearly 50% in the quarter compared to the same period last year. And small customer growth also remained strong both of which supported gross margin performance. These benefits were partially offset by the dilutive effect of freight and distribution costs resulting from higher fuel prices, the addition of our fifth distribution center this year that wasn't operational in the prior year period and continued deflation in certain commodity products. Selling, general and administrative expenses increased to approximately $371 million for the second quarter from $349 million for the same period last year. SG&A as a percentage of net sales increased approximately 30 basis points to 24.2%, driven primarily by the modest organic daily sales growth during the quarter. Acquisitions accounted for approximately half of the total year-over-year increase in SG&A for the second quarter. SG&A in the base business on an adjusted basis increased approximately 3.5% compared to the prior year period. The increase in base business SG&A was due primarily to higher health care expenses and fuel cost inflation. Effective tax rate was 25.7% for the second quarter compared to 25.4% for the prior year period, primarily due to higher state income tax expense. No excess tax benefits were recognized in the second quarter or the prior year period. We continue to expect the effective tax rate for fiscal 2026 will be between 25% and 26% excluding discrete items such as excess tax benefits. Net income attributable to SiteOne increased 8% to $139.3 million compared to $129.0 million in the prior year period. The improvement primarily reflects gross margin expansion, partially offset by higher SG&A expenses and continued market-related volume pressure. Our weighted average diluted share count was approximately 44.4 million during the second quarter compared to approximately $45.1 million for the same period last year. In the second quarter, we repurchased approximately 797,000 shares for approximately $94 million at an average price of $117.63 per share. This was our largest share repurchase quarter since we initiated the plan in October 2022. Post quarter end, we repurchased an additional 101,000 shares for approximately $10 million, bringing year-to-date repurchases through July to 1.053 million shares for approximately $124 million. Adjusted EBITDA increased 5% to $237.2 million compared to $226.7 million in the prior year period. Adjusted EBITDA margin of 15.5% was consistent with the prior year period. Adjusted EBITDA includes $1.3 million attributable to noncontrolling interest. During the quarter, we acquired the remaining 25% interest in Devil Mountain Wholesale Nursery and now own 100% of the business. Now I'll provide a brief update on our balance sheet and cash flow statement, as shown on Slide 10. Working capital at the end of the quarter was approximately $1.10 billion compared to $1.06 billion at the end of the same period last year. Cash provided by operating activities increased approximately $17 million to $153 million, due primarily to higher net income and a positive contribution from working capital changes. We made cash investments of approximately $15 million for the second quarter compared to approximately $17 million for the same period last year. Capital expenditures for the quarter were approximately $18 million compared to approximately $14 million for the same period last year due to increased investments in our branch locations and branch equipment. Net debt at quarter end was approximately $556 million compared to approximately $532 million for the prior year period. Net debt to trailing 12-month adjusted EBITDA was 1.3x which is within our range of 1x to 2x and unchanged compared to the same time last year. Available liquidity at the end of the quarter totaled approximately $530 million, consisting of $87 million of cash on hand and approximately $443 million of available borrowing capacity under our ABL Facility. During the quarter, we amended our ABL Facility to, among other things, extend the maturity date to April 2031, further strengthening our financial position. As a reminder, our priority from a balance sheet and liquidity perspective is to maintain our financial strength and flexibility so that we can execute our growth strategy in all market environments. I will now turn the call over to Daniel for an update on our acquisition strategy. Daniel Laughlin: Thanks, Eric. As shown on Slide 11, we did not complete an acquisition during the second quarter, However, our acquisition pipeline remains active and healthy. We continue to engage with a large number of high-quality businesses across the landscape supply industry and remain encouraged by both the quality and quantity of opportunities we are seeing. Our focus remains on building long-term value through disciplined acquisitions that strengthen our product offering, expand our capabilities and enhance our local market positions. As a reminder, we completed two acquisitions earlier this year that together represented approximately $110 million of trailing 12-month sales. These acquisitions further strengthened our position in attractive local markets while adding talented teams and new capabilities to the SiteOne platform. The integration of these businesses is on track and we are pleased with their performance and strategic fit. We continue to drive steady acquisition growth with a focus on building strong relationships with potential targets that lead to negotiated deals when they are ready to sell. Many of our most successful acquisitions have resulted from relationships that we have developed over many years. In many cases, we are meeting with owners long before they're actively considering a transaction. Our reputation is the acquirer of choice, our commitment to preserving local relationships and cultures and our track record of successful acquisitions continue to differentiate SiteOne in the market. Overall, we remain confident in the long-term acquisition opportunity in front of us. Our pipeline is active, our relationships remain strong, and our competitive advantages as a buyer continue to resonate with prospective sellers. We believe SiteOne remains uniquely positioned by a strong role in consolidating our industry for many years to come. I will now turn the call back to Doug. Doug Black: Thanks, Daniel. I'll wrap up on Slide 13. We believe that the ongoing energy volatility, higher interest rates, weak consumer confidence and increased macroeconomic uncertainty are collectively having a negative effect on the already weak new residential construction end market and the typically more resilient repair and upgrade end market. These trends are more than offsetting modest growth in maintenance and flat new commercial construction. Pricing continues to be positive, and we believe that pricing will contribute approximately 3% to net sales growth for the full year. Overall, with the benefit of our commercial initiatives, we expect organic daily sales growth for the year to be flat to up 1%. In terms of end markets, we are experiencing weakness in new residential construction demand, which comprises 20% of our sales, and we expect this market to be down high single digits for the full year 2026. New commercial construction demand, which represents 14% of our sales, has been solid so far, and we believe it will remain flat in 2026. Bidding activity from our project services teams continues to be slightly positive compared to the prior year, which is a good indicator of continued demand. We believe the repair and upgrade market, which represents 30% of our sales, was down in 2025 but seemed to have stabilized during the second half of last year. However, with the increased macroeconomic uncertainty, volatile energy costs, high interest rates and continued weak consumer confidence we believe that repair and upgrade market has taken another step down this year. While the long-term fundamentals for this end market are strong, we believe that repair and upgrade demand will be down approximately mid-single digits in 2026. Lastly, in the maintenance end market, which represents 36% of our sales, we achieved excellent sales volume growth in 2025 as our teams gain profitable market share on top of the steady demand growth. We have seen steady demand so far this year, though there seems to be some near-term volume reduction in response to higher fertilizer prices where the customers' maintenance budgets are fixed for the year. Overall, we expect the maintenance end market to grow modestly in 2026. In total, after almost 7 months of activity, we expect end market demand to be down this year with weakness in new residential construction and repair and upgrade more than offsetting modest growth in maintenance. Given this backdrop and with the benefit of our commercial initiatives and 3% growth in pricing, we expect our organic daily sales to be flat to up 1% for the full year 2026. We expect gross margin in 2026 to be higher than 2025, driven by price realization and our commercial initiatives, partially offset by higher freight and logistics costs supporting our growth. Given the lower sales volume, we expect SG&A as a percent of net sales to be approximately flat for the full year with our operational initiatives and actions to reduce SG&A offsetting higher fuel costs and general cost inflation. Overall, we expect solid improvement in our adjusted EBITDA margin. In terms of acquisitions, as Daniel mentioned, we have a good pipeline of high-quality targets, and we expect to add more excellent companies to the SiteOne family during the remainder of the year. Lastly, we have an extra week in 2026. Unfortunately, this extra week occurs in fiscal December during a very slow sales period, which is a traditionally loss-making period for SiteOne. As a result, we expect the extra week will reduce our adjusted EBITDA by $4 million to $5 million. All these factors in mind and including the negative effect of the 53rd week we expect our full year adjusted EBITDA for fiscal 2026 to be in the range of $425 million to $455 million. This range does not factor in any contribution from unannounced acquisitions. In closing, I would like to sincerely thank all our SiteOne associates who continue to amaze me with their passion, commitment, teamwork and selfless service. We have a tremendous team, and it is an honor to be joined with them as we deliver increasing value for all our stakeholders. I would also like to thank our suppliers for supporting us so strongly and our customers for allowing us to be their partner. Operator, please open the line for questions. Operator: [Operator Instructions] First question comes from Ryan Merkel with William Blair. Ryan Merkel: Doug, I wanted to start on the quarter and just the weaker volumes that you saw. It sounds like the biggest issue is new resi in the Sun Belt markets. What kind of negative growth are you seeing in the Sunbelt states for new resi. And then it sounds like R&R took a step down, which product categories are you seeing the biggest impact there? And is that broad-based across the country for the R&R market? Doug Black: Yes. So new residential, yes, we've seen some increased weakness. If you look at last year, starts were down significantly, completions were a little better than starts. And I think what we've seen this year is that starts are down mid-single digits, but completions are down high-single digits. And we're seeing worse than that in the Sunbelt, the California, Arizona, Texas and then better than that up in the Midwest. Overall, it's pretty broad-based, though in terms of residential outside of the kind of the Midwest we're seeing it across the Southeast, et cetera. So yes, so that market is kind of weaker than expected. Remodel is broad-based. Our remodel products, hardscapes and lighting are good barometers of our model. And yes, it is broad-based across the country. Obviously, it's a little worse than some of those Sun Belt areas. But we really think that's just a matter of the Iran war, the volatility in energy we consume, all the factors that typically support remodel really aren't there this year. We feel good about the markets long term, and we think it will snap back. And it has the opportunity to snap back faster, we believe, than residential. But right now, it's taken another step down. It's pretty weak. And we see those in those products. Obviously, we talk to our vendors and our partners. And so we have pretty good confidence that market's just taking another step down, hopefully, it will stabilize at the current levels. Ryan Merkel: Okay. Got it. That's helpful. And then my second question, how are you thinking about volumes in the third quarter? It looks like maybe down 2% is a good starting point. And then comment on pricing, 3% for the year. It implies you're not getting a lot of traction in some of the PVC and fertilizer price increases. Is that the right read? Doug Black: Yes. I think our volume outlook flat to up 1%, factors in the 3%. So that does assume kind of a 2% volume. We think the market is worse than that. We're getting a little bit -- we're gaining some market share to get us to that point. We'll see how it goes, but that's what we have factored in. Eric, you might want to talk specifically about price. Eric Elema: So Yes. We will get a benefit from PVC. We'll see those price increases now play out in the second half. Some of the finished goods too, that we've talked about, price increases are in. They're more in the 3% to 5% range. But again, the offsets to that, that are keeping it around 3% for now is fertilizer wrote up in the second quarter, even a little higher than originally we thought into the double digits, has come back down in the single digits with the pressure on urea and those commodities. So it's kind of uncertain, and we baked in kind of uncertainty coming back from double digits to single digits, so a little bit of pressure there. And then also, as I highlighted, we have fully lapped the tariff-related benefits that went in the second quarter last year. So in the second half of the year and originally how we thought about the year before the Middle East disruption is, there would be some downward pressure or comp on price. So those kind of balance out and get us into 3%. We do acknowledge if commodities were to rise again, that some of that pressure would go away and we could be higher than that 3% outlook. But where we sit today, we think that's a good read for now. Operator: Next question, David Manthey with Baird. David Manthey: First off, on -- just to check the metrics here, price and volume in both the agronomics and landscape products. Could you repeat that for me? I missed it on the monologue. Eric Elema: Right. Price for agronomics with 4% for the quarter and volume was 1%. David Manthey: And then landscape products? Eric Elema: Landscape products were flat and price was 3%. David Manthey: Okay. And then to touch on the fuel dynamics here, could you discuss the fuel impact as it relates to freight in and freight out? And just to clarify, the costs that you incur on fuel from your distribution centers to the branches. Does that fall into COGS, I would assume. And then as it relates to freight out on deliveries, have you been able to recoup that via surcharges? And then finally, on the freight in stuff, do you have a mechanism to recapture that as we move to the back half of the year? I know it's a lot, but it's a complex issue. Eric Elema: Yes. On the delivery side or the freight outside, as we mentioned before, we implemented fuel surcharges right at the end of the first quarter. Those have been in place throughout the second quarter and continue today. We have managed the rise in the fuel cost impact to net neutral, but it is dilutive to SG&A as a percentage of net sales. On the freight in side, we've done -- we're doing a number of things from supply chain management to mitigate that cost. But those costs as they come in on the products are translated into price increases. So we're managing that to pass through. There is a little bit of a dilutive effect that we've called out in the quarter, but we're doing the best to manage that. Doug Black: And David, on the -- just to give a magnitude on the freight out side, that fuel increase adds about 15 basis to SG&A with an offsetting benefit to gross margin. So it's really a transfer between one from the other. And then like Eric said, on the inbound, we capture that naturally through our pricing adjustments. David Manthey: Okay. And then just mechanically on the costs between distribution center and branch, where do those get picked up in the P&L? Eric Elema: Yes. They're in cost of goods. David Manthey: Those are in COGS too. Operator: Next question, Mike Dahl with RBC Capital Markets. Christopher Kalata: Chris on for Mike. Just going back to price, could you guys help flesh out just the grass seed and PVC expectation for the back half, how what that year-over-year change is going to look like? Doug Black: Yes. Grass seed, so those price changes just have gone in effect here in July. So we've been in a number of years of deflation. We are expecting those price increases to translate from the low-single-digit to mid-single-digit range here in the second half of the year. Third quarter is our largest grass seed selling quarter, about 40% of grass seed sales occur in the third quarter. So there will be some benefit in the second half of the year from grass seed. PVC price increases went in during the second quarter. We'll start to see those benefits here in the second half. It is into soft -- softer end market. So while we expect price to kind of hold up against the several years of high deflation, what kind of see how that plays out with price elasticity in the second half of the year. Christopher Kalata: Got it. Okay. And then just on the SG&A and the stepped-up health care inflation you guys saw this quarter. Is that onetime? Or is that kind of something we should be modeling into the back half? Just any comments you can provide on drivers of year-over-year leverage in SG&A on the back half. Eric Elema: Yes. Most of the 30 basis point improvement was made up with fuel inflation and then the higher health care cost. It was -- it's probably a little bit higher in the second quarter than we would expect it to be the rest of the year, but we do expect those to be higher the rest of the year, health care probably a little less than it was in the second quarter, but fuel inflation to continue for now for where it's been. Operator: Next question from Charles Perron with Goldman Sachs. Charles Perron-Piché: First, I just want to go back on the SG&A. You talked about SG&A leverage flat for the full year which represent an improvement versus the first half. I realize the improvement in volumes will be a key driver. But I think you mentioned in your prepared remarks additional actions to drive productivity. I guess, first, did I hear you correctly? And also, how do you think about the potential for additional actions to help you against the weaker market outlook? Doug Black: Yes. So we are taking additional actions. Obviously, with the volumes being weaker, we aim to adjust to that. And we are taking actions in our labor and our other costs to adjust down to the new volumes. As we mentioned, health care, which tends to move around during the quarter, we expect that to be a bit better. Obviously, we'll monitor that. And the fuel cost, we've assumed that it's going to continue on in. But taking all that together, we do aim to get leverage in the second half to kind of end up flat. And we are taking additional actions really responding around the volumes. We hope to be able to drive higher volumes, but we're not assuming that we'll be able to do that at this point in time. Charles Perron-Piché: Got it. Okay. That's helpful color. And second, I just want to flip to a commercial initiative. Can you provide an update on where do you see the biggest opportunities for penetration in the second half and how should you think about your ability to outperform your end market as a result, considering the weaker market outlook, does that change anything in terms of the different preferences or the performance of some of these initiatives? Doug Black: Right. Good question. No, we really -- we feel good about our initiatives on the commercial side. Even with the weak markets, we're continuing to penetrate with siteone.com. And we found that the customers that are digitally engaged with us are growing significantly faster than our average. We're still having good success with our small or medium customers which continues, whether it's a good market or a tough market, our private label brands, the growth there is significant, as we said, Pro-Trade is up over 50% for the year, still driving strong there with Solstice and portfolio and our other private brands. And so that -- and that has the dual benefit of driving share gain but also improving our gross margin. So we're happy on our sales force productivity. We're continuing to drive that. So all our initiatives are in kind of full mode, if you will, and they're going to help us navigate through these softer markets. And obviously, as things normalize, we expect that to continue to accelerate and outperform the market. Daniel Laughlin: Yes. And we improved delivery as well in the first half of the year and a net delivered metric that we track against delivered sales, that achieved leverage in the first half of the year as well. And we're on track with how we kind of outlined our long-term contribution annually. . Operator: Next question, Andrew Carter with Stifel. W. Andrew Carter: I guess first question I wanted to ask, I mean, your year 2 -- into year 2 on kind of these branch optimization, you're talking about SG&A Flex. Do you believe that any of your SG&A reductions are impacting your performance in the market? And then I guess the follow-on to that is if you look at the branches you've closed, what have been the retention. How has retention fared relative to kind of your original assumptions around business you lost, business that you would expect to go to other branches in the area? Doug Black: Yes. No, good question. No, we -- I mean, we are very much focused on growth. We obviously are taking actions with SG&A but we never kind of take actions that sacrifice growth. For our closed branches, we're quite happy with our retention. We've done, I think, a great job there. We are consolidating those into other branches nearby and maintaining those sales. So -- and so our SG&A actions are more about productivity improvement. The focused branch efforts involve growing sales as well as cutting SG&A. So it's not just kind of a one quiver method there. We are one of the best ways to turn around a focus branch is to improve the customer service and drive share gain. So our SG&A management and reductions we're doing that carefully. But when you have lower volume, like we're seeing, you can take prudent actions and not damage our ability to outperform the market. Eric Elema: Yes. Just a data point, we've always targeted at least to retain 80% of the sales through the consolidation with the nearby branch. And we did a study that in the first half, and we're tracking ahead of that threshold. W. Andrew Carter: And then a second question about kind of the additional SG&A actions that you're planning for this year. Do those come back -- do those come back, number one, in a flat market, which you kind of talked to for '27. And do they come back in like a full kind of normalized environment? . Doug Black: Yes. No, good question. Because we're doing them carefully and strategically, when the market comes back, we do get leverage on that. I mean it's not -- we eliminate and then we just add right back. We are eliminating or kind of reducing, reallocating more aggressively with the eye that we're going to improve productivity. And as the market comes back, we'll get good drop down to the bottom line on that growth. Operator: Next question, Matthew Bouley with Barclays. Elaine Ku: Elaine Ku on for Matt Bouley today. So on the full year guide, I just wanted to clarify I guess there is incrementally weaker volume and SG&A outlook maybe from last quarter, can you parse out maybe what might be coming in a little stronger within the gross margin or some commercial initiatives or just maybe on the acquisition front that is leading to unchanged EBITDA guide? Doug Black: Yes, I think like we mentioned, there is a swap out between SG&A and gross margin in terms of fuel. And with price moving nicely in the right direction, there's -- as we have more SG&A downside, let's say, as a percent of sales with the weaker volume, there's probably counterbalancing upside that helps us there. And so we're still very confident in our ability to expand EBITDA margins this year despite the weaker markets. Is there another part of the question? Elaine Ku: Yes. I guess for my second question, just on a different note, like for the Reinders acquisition, any updates around how the integration of that is tracking? And in terms of the biggest or most near-term synergies you might realize what's sort of your outlook on that? And when do you expect to see the synergies fully flowing through? Doug Black: Yes. No. The integration is going well with Reinders. Reinders is a terrific company. It's in the right part of the country for the current market. I mean, the market is actually quite strong in the Midwest, where they are up in Wisconsin and Michigan, Ohio, Illinois. And so from a top line standpoint, they're doing well. We're getting synergies that we've gotten purchasing synergies. We've got -- we're putting in product synergies, we're able to -- our system synergies, they don't have a CRM. We're adopting those things. So integration is on track. We won't have them fully integrated system-wise until early next year. They did quite a bit online themselves. And so we're being careful there to make sure that goes seamlessly. But the team's terrific. We're working well together and feeling really good about Reinders and long-term growth we can achieve together with Reinders going forward. Eric Elema: Yes. And I'd add too on the synergy front, it's a multiyear. So as Doug kind of mentioned, the first year synergies. But after integration, too, we have distribution and logistics synergies that we're going to get nearby to our Wisconsin DC, and then as well as there will be some branch optimization opportunities as well going forward in year 2. Doug Black: Right. You'll see a couple of consolidations there with their branches and our branches. So a good point. We're getting synergies this year, we expect to get synergies really over the next couple of years as we fully join our 2 teams together. Operator: Jeffrey Stevenson, Loop Capital. Jeffrey Stevenson: Has there been any meaningful change in the competitive environment of distribution from independent or large regional competitors with residential domain coming in softer than anticipated this year? Doug Black: Yes, nothing abnormal. I mean, when markets are soft, things get more competitive. I mean that just -- that happens in any market regardless of who you're competing against. So it's a very competitive market right now. Luckily, I mean we know how to compete hard on the, let's say, the large customers in the places that commercial and the places where all the competitors go. And then on the side through adjacent product lines and through going after small customers, et cetera, we're able to successfully gain market share. So I would describe it as a competitive market. As markets soften, they get more competitive. We're seeing that right now, but we know how to manage that, and we're confident we can manage through it to and the other side. Jeffrey Stevenson: Great. And then, Doug, can you provide more color on the near-term maintenance demand pressure you stated in your prepared remarks. Specifically, when did this begin to show up in the market and types of maintenance projects, customers are temporarily delaying due to higher pricing. Doug Black: Yes. I mean that is when you get the price increases up in the double digits, like we saw in the second quarter with fertilizer than your maintenance customers, which are working off of fixed budgets tend to dial back a bit on their volumes. That's a short-term strategy to kind of get through. We've -- as Eric mentioned, fertilizers come down a little bit. So it can quickly come back because they're managing to an annual budget. At the end of the year, they can adjust their budgets accordingly depending on kind of where the prices are at the time. So it's a short-term phenomenon. We feel like it negatively affected us in the second quarter, if prices come down, it could come back and be a tailwind in the third quarter, we'll see. But that tends to happen with fertilizer and combination products that are used every week, every month by these operators to kind of keep in line with their budgets. Operator: Next question, Matt Johnson with UBS. Matthew Johnson: Appreciate the time. I guess, first off, I think so organic daily volume was down, call it, almost 2% in the quarter. I think last quarter, you guys had mentioned it was down in April as well. I guess just given kind of all the noise and macro volatility that we've seen over the last few months, I guess, what did you -- out of demand, or I guess the volume, I should say, progress through May and June and then into July? Doug Black: Yes. No, great question. As you know, in the first quarter, volume was down 4% in the first quarter. Some of that was a push of the spring from the first quarter to the second quarter with weather. In April, we saw negative volumes, but improved from that. So we felt good. Okay, we're seeing the spring come through. In May, actually, the volumes were improved over April. And so we saw a nice trend. June, however, kind of with the other way, lost momentum. And based on the kind of June and July, I think we're seeing where the real market is. I mean with that spring moving from the first quarter to the second quarter, it's hard -- it's kind of hard to tell where the market is. Now that we have a full first half and actually another month that we can see what's going on. Now we're seeing more clearly where the market is and that's -- and we've talked about that, that we feel that the remodel has kind of taken a step down, and we're at a new level. So that's how it progressed. Kind of give us a little bit -- it was hard to tell how much was kind of momentum and how much was just kind of spring coming back through. And as it turned out, that momentum got lost in June and July. . Matthew Johnson: That's great. Appreciate that. Now I guess, changing topics a little bit, but just on greenfield expansion, I think at the Investor Day, you guys had talked about accelerating this opening maybe 5 to 10 new locations per year. But now I mean, clearly, demand -- end market demand has pulled back. You guys have talked about taking some actions on SG&A. I guess, how are you guys thinking about opening new greenfield locations right now? And just, I guess, how are you thinking about branch count more broadly as we move into the back half of '26? Doug Black: Yes. No, good question. As we mentioned, greenfields are going to be a more meaningful part of our strategy going forward. We've typically done 3 or 4 years. We expect to do more 5 to 10 a year. Today, we've done six greenfields combination across the country. Obviously, with the market being down, we're very selective in that sense. Specific markets in greenfields for specific reasons. And so we're very careful there that we're not overdoing it in a market that's down, et cetera. But yes, we are moving ahead on that pace of 5% to 10%, and we expect to maintain that over the next several years. But obviously, careful in a market like this where the markets are down in certain markets we can always delay or decide to move ahead depending on the strategic need. Six so far this year, we may have a couple more through the year, but we're going to be very careful given the environment we're in today. Operator: Next question is Shaun Calnan with Bank of America. Shaun Calnan: I wanted to follow up on the fixed budgets impacting maintenance demand. Are these typically reset at calendar year? Or is it more staggered and dependent on like who the customer itself. And I guess the crux of my question is, does this kind of put a ceiling on the agronomic sales for the remainder of the year? Doug Black: Agronomics is typically steady. And so I don't think different customers have different ways of budgeting and customers may be on an annual, they may be on a 2-year contract. They may be and that may fall in the calendar year or et cetera, it would be hard to answer that specifically. So the phenomenon we tend to see is price increases in 2 to 5 range aren't going to effect. They're planning those in, right? They plan for price increases. When you get commodity like fertilizer that goes up into the double digits, that's when they tend to modify their settings, if you will, to kind of get by. I mean, at the end of the day, they got to keep the lawns green, the grass is green, golf courses have to maintain excellent turf for players, et cetera. But they can move things around. So I wouldn't say it's a ceiling, but it's -- in the short term, if you have double-digit increases, you can't bank on that additive to a 2% volume increase. Eric Elema: Yes. there's two kind of high seasons, spring application and fall application season and we get to the fall, we're back in single digits. The demand impact reduced demand would be less. Doug Black: Yes. So it can move demand around during the year depending on -- they come up, they come down, et cetera. In this case, we think the second quarter was affected. Fertilizer comes back down. Again, that could come back in the third. Shaun Calnan: Okay. Great. And then it sounds like you guys are pretty confident that there will be more M&A this year. Can you talk about the size of those deals, what you think they could be? Are these going to be larger, smaller deals? And then how we should think about how that's going to impact share repurchases from here? Daniel Laughlin: I can take the first part of the question. So we typically don't talk about exact size deals. We are in active discussions with a number of companies, however, and we do expect to close more deals this year. With that, we think the results will fall in line with a more typical year for us in 2026 and beyond. Eric Elema: Yes. And on the share repurchase question, you can see what we've done so far year-to-date. We're not done. We kind of have that line of sight for the next a little under 6 months for the year on M&A. Obviously, growth remains the first priority, but we're going to be opportunistic like we have been. And we still plan to stay in the range. We started the year even a little below that 1x to 2x leverage range. So we expect to be higher than that to close out the year. So we're going to continue to take advantage of where the stock price is and repurchases and continue to return capital to shareholders. Operator: I would like to turn the floor over to Doug Black for closing remarks. Doug Black: Okay. Thank you. So we appreciate everybody's interest today in SiteOne. I want to take an opportunity to thank our suppliers for supporting us and our customers for allowing us to be their partner. I'd like to thank our associates. We have a tremendous team, and they're working hard to foster success for all of our stakeholders and look forward to catching up at the end of the next quarter. Thank you. Operator: This concludes today's teleconference. You may disconnect your lines at this time, and thank you for your participation. Before you buy stock in SiteOne Landscape Supply, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and SiteOne Landscape Supply wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $397,405!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,344,091!* Now, it’s worth noting Stock Advisor’s total average return is 953% — a market-crushing outperformance compared to 214% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors. See the 10 stocks » *Stock Advisor returns as of August 7, 2026. 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 no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. SiteOne (SITE) Q2 2026 Earnings Call Transcript was originally published by The Motley Fool

W.W. Grainger, Inc. GWW has reported second-quarter 2026 earnings of $12.01 per share, up 20.5% year over year. The figure beat the Zacks Consensus Estimate of $11.28 by 6.47%, aided by strong sales growth, and wider gross and operating margins.Quarterly sales increased 10.3% year over year to $5.02 billion and surpassed the consensus estimate of $4.95 billion by 1.35%. Daily sales advanced 10.3%, reflecting solid momentum across both operating segments. We predicted daily sales to increase 8.5%. On a daily, organic constant currency basis, sales increased 13.7%. The comparison adjusts for foreign currency movements and the company’s exit from the U.K. market, including the divested Cromwell business and closed Zoro U.K. operations. W.W. Grainger, Inc. price-consensus-eps-surprise-chart | W.W. Grainger, Inc. Quote The High-Touch Solutions N.A. segment’s daily sales rose 11.9% year over year in the second quarter of 2026, reflecting strong volume growth and a healthy contribution from pricing. Our model predicted year-over-year organic daily sales growth of 7.4%. The Endless Assortment segment’s daily sales grew 13.5% year over year in the quarter, supported by strong performances at MonotaRO and Zoro. Our model predicted organic daily sales growth of 12.2% for the quarter. Gross profit increased 13% year over year to $1.98 billion. The gross margin expanded 100 basis points to 39.5%, supported by improvement in both segments and benefits related to the U.K. market exit.The quarter included $43 million in refunds on IEEPA tariffs for products directly imported by Grainger. These refunds reduced the cost of goods sold and provided a roughly 90-basis-point benefit to the gross margin. The cost of sales came in at $3.04 billion, 8.5% year over year.Selling, general and administrative expenses rose 9.3% to $1.18 billion. Grainger’s operating earnings in the quarter increased 19% year over year to $807 million. The operating margin came in at 16.1% compared with 14.9% in the prior-year quarter. The company had cash and cash equivalents of $589 million as of June 30, 2026, compared with $585 million at the end of 2025. The cash flow from operating activities was $1.18 billion in the first six months of 2026 compared with $1.02 billion in the prior-year period.Long-term debt was $2.41 billion as of June 30, 2026, compared with $2.36 billion as of Dec. 31, 2025. Grainger returned $341 million to shareholders through dividends and share repurchases during the quarter. Grainger raised its 2026 net sales guidance to $19.4-$19.7 billion from $19.2-$19.6 billion. The company expects reported sales growth of 8.4-10% from the prior mentioned 6.7-9.1%.  The adjusted earnings guidance was increased to $45.50-$47.25 per share from $44.25-$46.25. Grainger also raised its operating margin outlook to 15.8-16.2% and the gross margin forecast to 39.3-39.6%. The updated outlook reflects strong first-half execution, improving MRO market demand and better top-line leverage. In the past year, GWW shares have gained 47.4% compared with the industry’s growth of 8%. Image Source: Zacks Investment Research The company currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. MSC Industrial Direct Company, Inc. MSM reported adjusted earnings per share of $1.43 for the third quarter of fiscal 2026, beating the Zacks Consensus Estimate of $1.28 by 11.72%. The bottom line increased 32.4% from the year-ago quarter’s adjusted earnings of $1.08 per share.MSC Industrial’s net sales were $1.05 billion, surpassing the consensus estimate of $1.03 billion by 1.74%. Sales increased 7.8% year over year, driven by stronger average daily sales, price benefits and a return to volume growth. Average daily sales increased 7.8% year over year and came in above the company’s quarterly outlook.SiteOne Landscape Supply, Inc. SITE delivered second-quarter earnings of $3.14 per share, missing the Zacks Consensus Estimate of $3.36. SITE posted earnings of $2.86 in the year-ago quarter.SiteOne Landscape posted sales of $1.53 billion for the quarter ended June 2026, missing the Zacks Consensus Estimate of $1.54 billion. The company posted sales of $1.46 billion in the year-ago quarter. Hudson Technologies, Inc. HDSN is anticipated to release second-quarter 2026 results on Aug. 5.The Zacks Consensus Estimate for Hudson’s earnings per share is pegged at 17 cents for the second quarter, implying a decline of 26% from the year-ago reported figure. The consensus estimate for Hudson Industrial’s total sales is pinned at $73.7 million, indicating a year-over-year increase of 1.1%. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report W.W. Grainger, Inc. (GWW) : Free Stock Analysis Report MSC Industrial Direct Company, Inc. (MSM) : Free Stock Analysis Report Hudson Technologies, Inc. (HDSN) : Free Stock Analysis Report SiteOne Landscape Supply, Inc. (SITE) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

The Selloff In SiteOne Landscape Supply Is Overextended SiteOne Landscape Supply (NYSE:SITE) reported second-quarter 2026 net sales growth of 5% and adjusted EBITDA growth of 5%, as pricing, acquisitions and commercial initiatives helped offset softer demand in key end markets. Net sales rose to approximately $1.53 billion from $1.46 billion a year earlier. Organic daily sales increased 1%, reflecting a 3% pricing contribution that more than offset a roughly 2% decline in organic volume. Acquisitions completed in 2025 and 2026 added about $49 million, or 3%, to quarterly sales growth. → Why SK hynix Could Be the Best AI Chip Stock to Buy Now SiteOne Landscape Supply Company Breaks To New Highs Net income attributable to SiteOne increased 8% to $139.3 million, while adjusted EBITDA rose to $237.2 million from $226.7 million. Adjusted EBITDA margin was unchanged at 15.5%. Chairman and CEO Doug Black said the company delivered solid results despite difficult market conditions, citing weakness in new residential construction and repair and upgrade activity. SiteOne expects new residential landscaping demand, which represents 20% of sales, to decline by high single digits for the full year. Repair and upgrade demand, representing 30% of sales, is expected to fall by mid-single digits. → 3 Value ETFs to Consider as Growth Stocks Lag Behind SiteOne Landscape Supply Grows To New High Black said new residential construction was particularly weak in Sun Belt markets including California, Arizona and Texas, while conditions were stronger in the Midwest. He also described repair and upgrade weakness as broad-based, with hardscapes and lighting serving as indicators of softer remodeling activity. “We believe that the ongoing energy volatility, higher interest rates, weak consumer confidence, and increased macroeconomic uncertainty are collectively having a negative effect” on new residential construction and repair and upgrade markets, Black said. → 5 AI Stocks Are Pulling Back—Which Growth Catalysts Still Look Strongest? Maintenance demand, which accounts for 36% of sales, has remained relatively steady, though the company said higher fertilizer prices temporarily reduced volumes among customers operating under fixed budgets. New commercial construction, representing 14% of sales, is expected to remain flat in 2026, according to management. Gross profit increased 6% to approximately $565 million, and gross margin expanded 50 basis points to 36.9%. The company attributed the improvement to price realization, growth in private-brand products and sales gains among small customers. Pro-Trade private-brand sales increased nearly 50% year over year during the quarter. Black said sales of the company’s Pro-Trade, Solstice and Portfolio private brands collectively grew 40%. SiteOne also reported that digital sales through siteone.com rose more than 50% year to date, while regular active users increased about 40%. Organic daily sales of agronomic products increased 5%, supported by 4% pricing and 1% volume growth. Landscaping product sales were flat organically, with 3% pricing offset by weaker demand in residential construction and repair and upgrade categories. Pricing was positive across most categories, though grass seed and PVC pipe prices declined 9% and 4%, respectively, during the quarter. Chief Financial Officer Eric Elema said grass seed price increases took effect in July and are expected to provide a low- to mid-single-digit pricing benefit in the second half. PVC price increases implemented in the second quarter are also expected to contribute in the back half. Selling, general and administrative expenses rose to approximately $371 million. SG&A as a percentage of sales increased 30 basis points to 24.2%, driven by modest organic growth, healthcare costs and fuel inflation. Acquisitions accounted for about half of the year-over-year increase in SG&A, Elema said. The company said fuel surcharges implemented near the end of the first quarter helped offset higher delivery costs. Black said increased fuel costs added approximately 15 basis points to SG&A as a percentage of sales, with an offsetting benefit to gross margin. SiteOne repurchased approximately 797,000 shares for about $94 million during the second quarter at an average price of $117.63 per share. After the quarter ended, it repurchased another 101,000 shares for approximately $10 million. Through July, year-to-date repurchases totaled 1.053 million shares for about $124 million. The company ended the quarter with net debt of approximately $556 million and net debt to trailing 12-month adjusted EBITDA of 1.3 times. Available liquidity totaled roughly $530 million, including $87 million in cash and $443 million of borrowing capacity under its asset-based lending facility. During the quarter, SiteOne amended the facility and extended its maturity to April 2031. SiteOne completed two acquisitions earlier this year representing approximately $110 million in trailing 12-month sales, including Reinders, a Midwest supplier of irrigation, agronomics and lighting products. The company did not close an acquisition during the second quarter but said its pipeline remains active and it expects additional deals during the remainder of 2026. Management said Reinders’ integration is on track, with initial purchasing, product and system synergies underway. Full systems integration is expected in early 2027, while distribution, logistics and branch optimization opportunities are expected to create benefits over multiple years. SiteOne expects full-year organic daily sales growth to range from flat to up 1%, supported by anticipated pricing growth of about 3%. The company expects gross margin to exceed 2025 levels and SG&A as a percentage of sales to be approximately flat for the full year as cost actions and operational initiatives offset fuel and other inflation. Management expects adjusted EBITDA margin expansion despite the softer volume environment. SiteOne reaffirmed its full-year adjusted EBITDA outlook of $425 million to $455 million, excluding contributions from unannounced acquisitions. The forecast includes an expected $4 million to $5 million negative impact from the extra week in fiscal 2026, which falls during the company’s seasonally slow December period. Black said the company has opened six greenfield locations so far in 2026 and remains on pace to pursue roughly five to 10 annually, while being selective in weaker local markets. He also said SiteOne’s branch consolidation efforts have retained more than its targeted 80% of sales transferred to nearby locations. SiteOne Landscape Supply is a leading distributor of landscape supplies and irrigation equipment in North America. The company serves a broad range of customers, including independent landscapers, lawn and garden retailers, municipalities and other commercial landscape professionals. Its product portfolio spans irrigation and lighting controls, pipes and fittings, fertilizers and soils, lighting fixtures, hardscapes, outdoor lighting systems and related installation accessories. In addition to core product lines, SiteOne offers agronomic services designed to optimize turf and plant health, as well as online tools and training resources to help customers plan, specify and manage projects more efficiently. 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 "SiteOne Landscape Supply Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for July 2026.

SiteOne Landscape (SITE) came out with quarterly earnings of $3.14 per share, missing the Zacks Consensus Estimate of $3.36 per share. This compares to earnings of $2.86 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of -6.55%. A quarter ago, it was expected that this company would post a loss of $0.45 per share when it actually produced a loss of $0.6, delivering a surprise of -33.33%. Over the last four quarters, the company has surpassed consensus EPS estimates two times. SiteOne Landscape, which belongs to the Zacks Industrial Services industry, posted revenues of $1.53 billion for the quarter ended June 2026, missing the Zacks Consensus Estimate by 0.9%. This compares to year-ago revenues of $1.46 billion. The company has topped consensus revenue estimates just once over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. SiteOne Landscape shares have lost about 16.9% since the beginning of the year versus the S&P 500's gain of 8.5%. While SiteOne Landscape has underperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for SiteOne Landscape was unfavorable. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #5 (Strong Sell) for the stock. So, the shares are expected to underperform the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $1.47 on $1.33 billion in revenues for the coming quarter and $4.02 on $4.96 billion in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Industrial Services is currently in the bottom 33% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. One other stock from the same industry, W.W. Grainger (GWW), is yet to report results for the quarter ended June 2026. The results are expected to be released on August 4. This seller of maintenance and other supplies is expected to post quarterly earnings of $11.28 per share in its upcoming report, which represents a year-over-year change of +13.1%. The consensus EPS estimate for the quarter has been revised 0.2% lower over the last 30 days to the current level. W.W. Grainger's revenues are expected to be $4.95 billion, up 8.8% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report SiteOne Landscape Supply, Inc. (SITE) : Free Stock Analysis Report W.W. Grainger, Inc. (GWW) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

This article first appeared on GuruFocus. Release Date: July 29, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. SiteOne Landscape Supply Inc (NYSE:SITE) reported a 5% growth in net sales and adjusted EBITDA for the second quarter of 2026. The company achieved an 8% growth in net income and maintained strong cash flow despite challenging market conditions. SiteOne Landscape Supply Inc (NYSE:SITE) executed a successful share repurchase program, returning over $100 million to shareholders. The company has a robust acquisition pipeline and expects to continue adding and integrating more companies throughout the year. SiteOne Landscape Supply Inc (NYSE:SITE) increased its digital sales on SiteOne.com by over 50% year-to-date, indicating strong engagement with digitally active customers. Market conditions remain challenging, with new residential landscaping demand down high single-digits and repair and upgrade demand down mid single-digits. Sales volume declined by 2% during the quarter, reflecting the impact of softer end markets. SG&A expenses as a percentage of net sales increased by 30 basis points due to higher fuel costs, increased healthcare expenses, and ongoing cost inflation. The company expects the extra week in fiscal December to reduce adjusted EBITDA by $4 to $5 million. SiteOne Landscape Supply Inc (NYSE:SITE) faces ongoing macroeconomic uncertainties, including energy volatility, higher interest rates, and weak consumer confidence, affecting market demand. Warning! GuruFocus has detected 3 Warning Signs with SITE. Is SITE fairly valued? Test your thesis with our free DCF calculator. Q: Doug, regarding the weaker volumes, it seems the biggest issue is new residential construction in the Sun Belt markets. What kind of negative growth are you seeing there, and how is the repair and remodel (R&R) market affected? A: Doug Black, CEO: New residential construction is seeing increased weakness, with starts down mid-single digits and completions down high single digits, particularly in the Sun Belt states like California, Arizona, and Texas. The R&R market is broad-based across the country, with hardscapes and lighting being good indicators of this decline. The Iran war and energy volatility are impacting these markets, but we remain optimistic about long-term recovery. Q: How are you thinking about volumes in the third quarter, and can you comment on pricing, particularly for PVC and fertilizer? A: Doug Black, CEO: We expect volumes to be flat to up 1%, factoring in a 3% price increase, which implies a 2% volume decline. Eric Lema, CFO: We will benefit from PVC price increases in the second half, but fertilizer prices have come down from double digits to single digits, creating some uncertainty. We expect pricing to remain around 3% for the year. Q: Can you clarify the price and volume metrics for agronomics and landscape products? A: Eric Lema, CFO: For agronomics, price increased by 4% and volume by 1% in the quarter. Landscape products saw flat volume with a 3% price increase. Q: How are fuel costs impacting your freight expenses, and are you able to recoup these costs through surcharges? A: Eric Lema, CFO: We implemented fuel surcharges at the end of the first quarter, which have helped manage the rise in fuel costs to a net neutral impact. Freight costs are passed through in product pricing, although there is some dilution effect. Doug Black, CEO: Fuel increases add about 15 basis points to SG&A, offset by a benefit to gross margin. Q: Regarding SG&A leverage, you mentioned additional actions to drive productivity. Can you elaborate on these actions and their potential impact? A: Doug Black, CEO: We are taking actions to adjust labor and other costs in response to weaker volumes. We aim to achieve leverage in the second half to end up flat for the year. These actions are focused on productivity improvements without sacrificing growth. Q: Can you provide an update on your commercial initiatives and their potential to outperform the market given the weaker outlook? A: Doug Black, CEO: We feel good about our initiatives, including digital engagement through SiteOne.com, growth with small and medium customers, and private label brands. These initiatives help us gain market share and improve gross margins, positioning us well to navigate softer markets and accelerate growth as conditions normalize. Q: How is the integration of the Rynders acquisition progressing, and what synergies do you expect? A: Doug Black, CEO: The integration is going well, with Rynders performing strongly in the Midwest. We are realizing purchasing and product synergies and expect full system integration by early next year. Eric Lema, CFO: Synergies will continue over the next couple of years, including distribution and logistics efficiencies. Q: Has there been any change in the competitive environment with softer residential demand? A: Doug Black, CEO: The market is competitive, especially when it's soft, but we are confident in our ability to manage through it. We focus on gaining market share through product lines and targeting small customers, which helps us compete effectively. For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Second Quarter 2026 Highlights (Compared to Second Quarter 2025): Net sales increased 5% to $1,530.7 million Organic Daily Sales increased 1% Gross profit increased 6% to $564.5 million; gross margin expanded 50 basis points to 36.9% SG&A as a percentage of Net sales increased 30 basis points to 24.2% Net income attributable to SiteOne increased 8% to $139.3 million Adjusted EBITDA1 increased 5% to $237.2 million; Adjusted EBITDA margin was 15.5% Cash provided by operating activities increased $16.5 million to $153.2 million Amended ABL Facility and extended maturity to April 2031 Repurchased $93.8 million of shares under the share repurchase authorization Acquired remaining 25% interest in Devil Mountain Wholesale Nursery Post Quarter Highlights Repurchased additional $10.0 million of shares under the share repurchase authorization ROSWELL, Ga., July 29, 2026--(BUSINESS WIRE)--SiteOne Landscape Supply, Inc. (the "Company" or "SiteOne") (NYSE: SITE) announced earnings for its second quarter ended June 28, 2026 ("Second Quarter 2026"). "We delivered a solid second quarter performance with 5% growth in Net sales and Adjusted EBITDA despite softer end markets," said Doug Black, Chairman and CEO of SiteOne. "Our teams executed well throughout the quarter, managing through the market challenges, delivering value to our customers and suppliers, achieving operational improvements, and managing our spending to the reduced demand. Additionally, our acquisitions, led by Reinders, continue to perform well while our pipeline of additional deals remains active. We repurchased nearly $104 million of shares during the quarter and in July, reflecting the strength of our balance sheet, our belief in the business, and our commitment to shareholder returns. While market conditions remain challenging, we are confident in our 2026 outlook and our ability to continue executing our strategy to drive sustainable long-term performance and growth." Second Quarter 2026 Results Net sales for the Second Quarter 2026 increased 5% to $1,530.7 million, compared to $1,461.6 million for the prior year period. Organic Daily Sales increased 1% compared to the prior year period, driven primarily by price inflation in response to rising costs and our commercial initiatives, partially offset by softer demand in the new residential construction and repair and upgrade end markets. Acquisitions contributed $49.2 million, or 3%, to Net sales growth during the quarter. Gross profit increased 6% to $564.5 million for the Second Quarter 2026, compared to $531.4 million for the prior year period. Gross margin improved 50 basis points to 36.9%, driven primarily by higher price realization and continued benefits from commercial initiatives, partially offset by higher freight and distribution costs as well as deflation in certain commodity products. Selling, general and administrative expenses ("SG&A") for the Second Quarter 2026 increased to $370.7 million from $349.1 million for the prior year period. SG&A as a percentage of Net sales increased 30 basis points to 24.2% due primarily to the modest Organic Daily Sales growth and higher fuel cost during the quarter, partially offset by our operational initiatives and continued cost control. Net income attributable to SiteOne for the Second Quarter 2026 increased 8% to $139.3 million compared to $129.0 million for the prior year period, reflecting gross margin expansion, partially offset by lower sales volume and higher SG&A. Adjusted EBITDA1 for the Second Quarter 2026 increased 5% to $237.2 million, compared to $226.7 million for the prior year period. Adjusted EBITDA margin of 15.5% was flat compared to the prior year period. Net debt, calculated as long-term debt (net of issuance costs and discounts) plus finance leases, net of Cash and cash equivalents on our balance sheet as of June 28, 2026, was $555.6 million compared to $531.6 million as of June 29, 2025. Net debt to Adjusted EBITDA1 for the last twelve months was 1.3 times, which was unchanged compared to the prior year period. As of June 28, 2026, Cash and cash equivalents were $87.4 million and available capacity under the ABL Facility was $443.0 million. Outlook "Our end markets continue to be challenging and we estimate new residential construction is down high-single digits with repair and upgrade also down mid-single digits, more than offsetting modest growth in maintenance and flat new commercial construction," Doug Black continued. "Given the ongoing macroeconomic uncertainty, we expect these trends to continue through the full year. Pricing was up 3% in the quarter and we expect this also to continue through the remainder of the year. With the benefit of our commercial initiatives and price inflation, we expect Organic Daily Sales growth to be flat to up 1% for the full year. We expect to also expand our Gross margin through continued price realization and execution of our commercial initiatives. We expect SG&A as a percentage of Net sales to be approximately flat for the full year as our operational initiatives offset the effect of lower sales volume and the negative effect of the extra week in December. Overall, including contributions from acquisitions, we expect to continue expanding our Adjusted EBITDA margin in 2026." In fiscal year 2026, our results include an extra week compared to the prior year period. The extra week occurs in December of our fiscal fourth quarter during a historically slower sales period and, as a result, is expected to reduce Adjusted EBITDA for the year by approximately $4 million to $5 million. With all these factors in mind and including the negative effect of the 53rd week, we continue to expect Adjusted EBITDA for fiscal year 2026 to be in the range of $425 million to $455 million. Our guidance does not include any contributions from unannounced acquisitions. Reconciliation for the forward-looking full year 2026 Adjusted EBITDA outlook is not being provided, as the Company does not currently have sufficient data to accurately estimate the variables and individual adjustments for such reconciliation. Conference Call Information SiteOne management will host a conference call today, July 29, 2026, at 8:00 a.m. Eastern Time, to discuss the Company’s financial results. The conference call can also be accessed by dialing 877-704-4453 (domestic) or 201-389-0920 (international), or by clicking on this link for instant telephone access to the call. A telephonic replay will be available approximately two hours after the call by dialing 844-512-2921, or for international callers, 412-317-6671. The passcode for the replay is 13761526. The replay will be available until 11:59 p.m. (ET) on August 12, 2026. 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 http://investors.siteone.com. The online replay will be available for 30 days 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 SiteOne, please visit the company's website at http://investors.siteone.com. About SiteOne Landscape Supply, Inc. SiteOne Landscape Supply, Inc. (NYSE: SITE), is the largest and only nationwide full product line wholesale distributor of landscape supplies in the United States and has an established presence in Canada. Its customers are primarily residential and commercial landscape professionals who specialize in the design, installation and maintenance of lawns, gardens, golf courses and other outdoor spaces. Forward-Looking Statements This release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may include, but are not limited to, statements relating to our acquisition pipeline, organic and acquisition growth, execution of commercial and operational initiatives, and 2026 outlook. Some of the forward-looking statements can be identified by the use of terms such as "may," "intend," "might," "will," "should," "could," "would," "expect," "believe," "estimate," "anticipate," "predict," "project," "potential," or the negative of these terms, and similar expressions. You should be aware that these forward-looking statements are subject to risks and uncertainties that are beyond our control. Further, any forward-looking statement speaks only as of the date on which it is made, and we undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which it is made or to reflect the occurrence of anticipated or unanticipated events or circumstances. New factors emerge from time to time that may cause our business not to develop as we expect, and it is not possible for us to predict all of them. Factors that may cause actual results to differ materially from those expressed or implied by the forward-looking statements include, but are not limited to, the following: cyclicality in residential and commercial construction markets; general business, economic, and financial market conditions, the level of new home sales and construction activity, geopolitical conflicts, trade disputes, inflationary pressures, capital markets volatility, and declines in consumer confidence; severe weather and climate conditions; seasonality of our business and its impact on demand for our products; volatility in the prices for the products we purchase and the costs required to operate our business; laws and regulations governing our operations; hazardous materials and related materials; laws and government regulations applicable to our business that could negatively impact demand for our products; competitive industry pressures; supply chain disruptions (including as a result of geopolitical conflicts, the imposition of U.S. tariffs or any changes affecting tariffs resulting from the U.S. Supreme Court decision), product or labor shortages, and the loss of key suppliers; inventory management risks; ability to implement our business strategies and achieve our growth objectives; acquisition and integration risks, including increased competition for acquisitions; risks associated with our large labor force and our customers’ labor force, as well as labor market disruptions; public perceptions that our products and services are not environmentally friendly or that our practices are not sustainable; retention of key personnel; construction defect and product liability claims; impairment of goodwill; inefficient or ineffective allocation of capital; credit sale risks; performance of individual branches; cybersecurity incidents involving our systems or third-party systems; failure or malfunctions in our information technology systems; security of personal information about our customers; intellectual property and other proprietary rights; unanticipated changes in our tax provisions, including those resulting from the passage of the One Big Beautiful Bill Act; risks related to our current indebtedness, including with respect to elevated interest rates on our variable indebtedness, and our ability to obtain financing in the future; threats from terrorism, violence, uncertain political conditions, and geopolitical conflicts with Iran as well as the ongoing conflict between Russia and Ukraine and other disruptions in the Middle East; and other risks, as described in Item 1A, "Risk Factors", and elsewhere in our Annual Report on Form 10-K for the fiscal year ended December 28, 2025, as may be updated by subsequent filings under the Securities Exchange Act of 1934, as amended, including Forms 10-Q and 8-K. Non-GAAP Financial Information This release includes certain financial information, not prepared in accordance with U.S. GAAP. Because not all companies calculate non-GAAP financial information identically (or at all), the presentations herein may not be comparable to other similarly titled measures used by other companies. Further, these measures should not be considered substitutes for the information contained in the historical financial information of the Company prepared in accordance with U.S. GAAP that is set forth herein. We present Adjusted EBITDA in order to evaluate the operating performance and efficiency of our business. Adjusted EBITDA represents EBITDA as further adjusted for items permitted under the covenants of our credit facilities. EBITDA represents Net income (loss) plus the sum of income tax expense (benefit), interest expense, net of interest income, and depreciation and amortization. Adjusted EBITDA represents EBITDA as further adjusted for stock-based compensation expense, (gain) loss on sale of assets and termination of finance leases not in the ordinary course of business, financing fees, as well as other fees and expenses related to acquisitions, and other non-recurring (income) loss. Adjusted EBITDA includes Adjusted EBITDA attributable to non-controlling interest. Adjusted EBITDA does not include pre-acquisition acquired Adjusted EBITDA. Adjusted EBITDA is not a measure of our liquidity or financial performance under U.S. GAAP and should not be considered as an alternative to Net income, operating income or any other performance measures derived in accordance with U.S. GAAP, or as an alternative to cash flow from operating activities as a measure of our liquidity. The use of Adjusted EBITDA instead of Net income has limitations as an analytical tool. Because not all companies use identical calculations, our presentation of Adjusted EBITDA may not be comparable to other similarly titled measures of other companies, limiting its usefulness as a comparative measure. Net debt is defined as long-term debt (net of issuance costs and discounts) plus finance leases, net of Cash and cash equivalents on our balance sheet. Leverage Ratio is defined as Net debt to trailing twelve months Adjusted EBITDA. Free Cash Flow is defined as Cash Flow from Operating Activities, less capital expenditures. Base Business is defined as SiteOne operations excluding acquired branches that have not been under our ownership for at least four full fiscal quarters at the start of the fiscal year. We define Organic Daily Sales as Organic Sales divided by the number of Selling Days in the relevant reporting period. We define Organic Sales as Net sales, including Net sales from newly-opened greenfield branches, but excluding Net sales from acquired branches until they have been under our ownership for at least four full fiscal quarters at the start of the fiscal year. Selling Days are the number of business days, excluding Saturdays, Sundays, and holidays, that SiteOne branches are open during the relevant reporting period. View source version on businesswire.com: https://www.businesswire.com/news/home/20260729473784/en/ Contacts Investor Relations Contact: SiteOne Landscape Supply, Inc.Investor [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. Net sales grew 5% despite a 2% decline in organic volume, as management successfully leveraged 3% pricing gains and a 3% contribution from acquisitions. Management attributes volume weakness to high-single-digit declines in new residential construction and mid-single-digit drops in repair and upgrade demand, driven by macroeconomic uncertainty and interest rates. Gross margin improved 50 basis points to 36.9% through price realization, growth in private brands, and increased penetration with small customers. Maintenance demand faced short-term volume pressure as customers with fixed budgets adjusted to significant price increases in fertilizer and agronomic products. The company expanded its total addressable market estimate from $25 billion to $36 billion by including adjacent product categories entered over the last five years. Digital sales on siteone.com increased over 50% year-to-date, with management noting that digitally engaged customers are gaining market share faster than the company average. Full year 2026 adjusted EBITDA is projected between $425 million and $455 million, which includes a $4 million to $5 million negative impact from an extra week in December. Management expects organic daily sales growth to be flat to up 1% for the full year, assuming pricing remains steady at approximately 3%. SG&A as a percentage of net sales is expected to be approximately flat for the year as operational initiatives and labor adjustments offset fuel and health care inflation. The company anticipates continued acquisition activity for the remainder of the year, supported by a robust pipeline and a target of adding $2 billion in acquired revenue over the next decade. Greenfield expansion is expected to accelerate to a pace of 5 to 10 new locations annually, though management remains selective based on specific market conditions. Fuel cost inflation added 15 basis points to SG&A, though this was mitigated by fuel surcharges that shifted the benefit to gross margin, resulting in a net neutral impact. The company completed the acquisition of the remaining 25% interest in Devil Mountain Wholesale Nursery, now owning 100% of the business. A fifth distribution center became operational this year, contributing to higher freight and distribution costs compared to the prior year period. Management executed its largest share repurchase quarter since 2022, returning over $100 million to shareholders in response to recent share price weakness. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Management noted that while the Midwest remains strong, the Sunbelt (California, Arizona, and Texas) is seeing residential demand declines worse than the national average. The repair and upgrade market has taken a 'step down' due to energy volatility and weak consumer confidence, though management believes it can recover faster than new residential. PVC price increases implemented in Q2 are expected to benefit the second half, while grass seed prices are transitioning from deflation to mid-single-digit increases. Fertilizer pricing, which reached double-digit inflation in Q2, is expected to moderate back to single digits in the second half of the year. Management is taking additional actions in labor and other costs to adjust to lower volumes, aiming for SG&A leverage in the second half of the year. Branch consolidations are tracking ahead of the 80% sales retention target, supporting productivity without sacrificing market share.

Agriculture products company SiteOne Landscape Supply (NYSE:SITE) will be announcing earnings results this Wednesday before the bell. Here’s what investors should know. SiteOne missed analysts’ revenue expectations last quarter, reporting revenues of $940.1 million, flat year on year. It was a softer quarter for the company, with a significant miss of analysts’ EPS estimates and a significant miss of analysts’ organic revenue estimates. Is SiteOne a buy or sell going into earnings? Read our full analysis here, it’s free for active Edge members. This quarter, the market is expecting SiteOne’s revenue to grow 5.5% year on year, improving from the 3.4% increase it recorded in the same quarter last year. Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business will stay the course heading into earnings. SiteOne has missed Wall Street’s revenue estimates multiple times over the last two years. Looking at SiteOne’s peers in the industrial distributors segment, some have already reported their Q2 results, giving us a hint as to what we can expect. Richardson Electronics delivered year-on-year revenue growth of 27.6%, beating analysts’ expectations by 19.6%, and United Rentals reported revenues up 11.8%, topping estimates by 4.9%. Richardson Electronics traded up 21.2% following the results while United Rentals was also up 10.1%. Read our full analysis of Richardson Electronics’s results here and United Rentals’s results here. Over the past year, investors have repeatedly shifted their focus from one macro narrative to another (AI disruption and AI capex spending to geopolitics, interest rates, and the broader health of the economy). While some of the industrial distributors stocks have shown solid performance in this choppy environment, the group has generally underperformed, with share prices down 3.3% on average over the last month. SiteOne is down 11.7% during the same time and is heading into earnings with an average analyst price target of $157.08 (compared to the current share price of $101.35). ALSO WORTH WATCHING: Nvidia’s Quiet Partner. Nvidia’s chips cost a hundred grand. The connectors that make them work cost even more. One company makes them all. Every AI server needs specialized infrastructure the chip companies don’t make. High-speed cables. Power connectors. Thermal sensors. This 90-year-old company built a monopoly on it. The AI boom just started. This stock is still flying under the radar. Claim The Stock Ticker Here for FREE.