Analyst Kevin Steinke of Barrington maintained a Buy rating on Distribution Solutions Group (DSGR – Research Report), boosting the price target to $40.00.
Kevin Steinke’s rating is based on a combination of factors indicating positive momentum and strategic growth despite recent challenges. The Distribution Solutions Group (DSGR) demonstrated a 19.5% increase in year-over-year revenue for Q1/24, signaling strength in their acquisitions, particularly the notable contribution from Hisco. While organic growth experienced a decline due to softer demand in some markets like electronics and renewable energy, management’s optimistic perspective on long-term growth and strategic focus on large accounts are promising signs of future recovery and expansion.
Moreover, the company’s proactive measures to bolster sales infrastructure and its capacity to serve local markets more efficiently suggest an adaptive and forward-thinking approach. Although the TestEquity segment faced an organic decline due to market conditions and interest rate impacts, there is an expectation that the bottom has been reached with a potential rebound on the horizon. Steinke’s analysis also notes that the Gexpro Services segment, despite experiencing setbacks in technology and renewable energy markets, has shown signs of sequential growth, adding to the rationale behind the Buy rating and the increased price target to $40.
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Distribution Solutions Group (DSGR) Company Description:
Lawson Products, Inc. engages in distribution of maintenance and repair products to the industrial, commercial, institutional and government market. It operates through Lawson and Bolt segments. The Lawson segment focuses in the large network of sales representatives to visit the customer at the customers’ location and produce sales orders for product that is then shipped to the customer, and also provides vendor managed inventory (VMI) services. The Bolt segment sells product to customers when the customers visit one of Bolt’s 14 branch locations and the product is delivered to the customers at the point of sale. The company was founded by Sidney L. Port in 1952 and is headquartered in Chicago, IL.
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