As the craze of earnings season draws to a close, here’s a look back at some of the most exciting (and some less so) results from Q3. Today, we are looking at industrial distributors stocks, starting with GATX (NYSE: GATX).

Supply chain and inventory management are themes that grew in focus after COVID wreaked havoc on the global movement of raw materials and components. Distributors that boast a reliable selection of products–everything from hardhats and fasteners for jet engines to ceiling systems–and quickly deliver goods to customers can benefit from this theme. While e-commerce hasn’t disrupted industrial distribution as much as consumer retail, it is still a real threat, forcing investment in omnichannel capabilities to better interact with customers. Additionally, distributors are at the whim of economic cycles that impact the capital spending and construction projects that can juice demand.

The 24 industrial distributors stocks we track reported a mixed Q3. As a group, revenues beat analysts’ consensus estimates by 1.1% while next quarter’s revenue guidance was in line.

While some industrial distributors stocks have fared somewhat better than others, they have collectively declined. On average, share prices are down 3.1% since the latest earnings results.

GATX (NYSE: GATX)

Originally founded to ship beer, GATX (NYSE: GATX) provides leasing and management services for railcars and other transportation assets globally.

GATX reported revenues of $439.3 million, up 8.4% year on year. This print exceeded analysts’ expectations by 0.8%. Despite the top-line beat, it was still a softer quarter for the company with a significant miss of analysts’ EBITDA and EPS estimates.

The market was likely pricing in the results, and the stock is flat since reporting. It currently trades at $172.81.

Is now the time to buy GATX? Access our full analysis of the earnings results here, it’s free for active Edge members.

Best Q3: Richardson Electronics (NASDAQ: RELL)

Founded in 1947, Richardson Electronics (NASDAQ: RELL) is a distributor of power grid and microwave tubes as well as consumables related to those products.

Richardson Electronics reported revenues of $54.61 million, up 1.6% year on year, outperforming analysts’ expectations by 6%. The business had an incredible quarter with a beat of analysts’ EPS and EBITDA estimates.

Richardson Electronics delivered the biggest analyst estimates beat among its peers. The market seems content with the results as the stock is up 1.6% since reporting. It currently trades at $10.79.

Is now the time to buy Richardson Electronics? Access our full analysis of the earnings results here, it’s free for active Edge members.

Weakest Q3: Alta (NYSE: ALTG)

Founded in 1984, Alta Equipment Group (NYSE: ALTG) is a provider of industrial and construction equipment and services across the Midwest and Northeast United States.

Alta reported revenues of $422.6 million, down 5.8% year on year, falling short of analysts’ expectations by 8.4%. It was a disappointing quarter as it posted a significant miss of analysts’ revenue and adjusted operating income estimates.

Alta delivered the weakest performance against analyst estimates and slowest revenue growth in the group. As expected, the stock is down 17.2% since the results and currently trades at $4.86.

Read our full analysis of Alta’s results here.

Custom Truck One Source (NYSE: CTOS)

Inspired by a family gas station, Custom Truck One Source (NYSE: CTOS) is a distributor of trucks and heavy equipment.

Custom Truck One Source reported revenues of $482.1 million, up 7.8% year on year. This print lagged analysts' expectations by 1.5%. Zooming out, it was actually a strong quarter as it recorded a beat of analysts’ EPS estimates and an impressive beat of analysts’ adjusted operating income estimates.

Custom Truck One Source scored the highest full-year guidance raise among its peers. The stock is down 11.6% since reporting and currently trades at $5.96.

Read our full, actionable report on Custom Truck One Source here, it’s free for active Edge members.

DNOW (NYSE: DNOW)

Spun off from National Oilwell Varco, DNOW (NYSE: DNOW) provides distribution and supply chain solutions for the energy and industrial end markets.

DNOW reported revenues of $634 million, up 4.6% year on year. This result was in line with analysts’ expectations. Overall, it was a strong quarter as it also logged a beat of analysts’ EPS estimates and an impressive beat of analysts’ EBITDA estimates.

The stock is down 6.1% since reporting and currently trades at $13.71.

Read our full, actionable report on DNOW here, it’s free for active Edge members.

Market Update

Thanks to the Fed’s rate hikes in 2022 and 2023, inflation has been on a steady path downward, easing back toward that 2% sweet spot. Fortunately (miraculously to some), all this tightening didn’t send the economy tumbling into a recession, so here we are, cautiously celebrating a soft landing. The cherry on top? Recent rate cuts (half a point in September 2024, a quarter in November) have propped up markets, especially after Trump’s November win lit a fire under major indices and sent them to all-time highs. However, there’s still plenty to ponder — tariffs, corporate tax cuts, and what 2025 might hold for the economy.

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