Fastenal Company engages in the wholesale distribution of industrial and construction supplies in the United States, Canada, and internationally. The company offers fasteners, and other industrial and construction supplies primarily under the Fastenal name. The company was founded in 1967 and is based in Winona, Minnesota.
FAST Price Forecast Based on DCF Valuation
DCF Fair Value Target:
The table below illustrates the output of a discounted cash flow forecast using a variety of scenarios for Fastenal Co. To summarize, we found that Fastenal Co ranked in the 33th percentile in terms of potential gain offered. We should note, though, that the most conservative analysis suggests this stock will yield negative results -- and thus may be a potential short opportunity. As for the metrics that stood out in our discounted cash flow analysis of Fastenal Co, consider:
Interest coverage, a measure of earnings relative to interest payments, is 88.22; that's higher than 97.1% of US stocks in the Industrials sector that have positive free cash flow.
The business' balance sheet reveals debt to be 3% of the company's capital (with equity being the remaining amount). Approximately only 9.63% of US stocks with free cash flow have a lower reliance on debt in their capital structure.
FAST's estimated cost of debt, based largely on its market capitalization and its interest coverage ratio, is 2%; for context, that number is higher than 53.5% of tickers in our DCF set.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
Want more companies with a valuation profile/forecast similar to that of Fastenal Co? See EEX, CLCT, CW, ITW, and RRD.
The industrial sector includes companies that produce machinery, equipment, and supplies that are used in construction and manufacturing, as well as providing related services. Well-known companies in this group include Honeywell International Inc. (HON), Lockheed Martin Corp. (LMT), and 3M Co. (MMM). The industrial sector also includes companies that provide air transportation services such as American Airlines Group Inc. (AAL).