Core Insights - Core & Main (CNM) has reached a significant support level and crossed above the 200-day moving average, indicating a long-term bullish trend [1] - CNM shares have increased by 11.6% over the past four weeks, reflecting positive market momentum [2] - The company currently holds a Zacks Rank 3 (Hold), suggesting potential for continued growth [2] Earnings Estimates - There have been three upward revisions in earnings estimates for CNM for the current fiscal year, with no downward revisions, indicating positive sentiment among analysts [3] - The consensus earnings estimate for CNM has also increased, further supporting the bullish outlook [3] Technical Indicators - The 200-day simple moving average is a key technical indicator that helps establish long-term market trends and serves as a support or resistance level [2] - The recent price movements and technical indicators suggest that CNM may be positioned for further gains in the near future [3]

Group 1 - The individual investor focuses on managing personal capital accumulated over the years, utilizing a diverse range of investment strategies including fundamental, technical, and momentum investing [1] - The investor aims to leverage the strengths of various investment approaches to refine their investment process [1] - The purpose of writing on Seeking Alpha is to track the performance of investment ideas and connect with like-minded investors [1]

Group 1 - Core & Main (NYSE: CNM) experienced a significant positive impact on its shareholders on December 3rd, indicating strong market performance [1] - The company is involved in the distribution of a vast array of products, with hundreds of thousands of SKUs available [1] Group 2 - Crude Value Insights provides an investment service focused on the oil and natural gas sector, emphasizing cash flow and the potential for value and growth [1] - Subscribers to Crude Value Insights benefit from a model account featuring over 50 stocks, detailed cash flow analyses of exploration and production firms, and live discussions about the sector [2]

Core Insights - Core & Main exceeded third-quarter earnings and revenue forecasts, benefiting from acquisitions [1] - The company set records for quarterly revenue and adjusted EBITDA [1] - CEO Steve LeClair highlighted the impact of five acquisitions on expanding geographic presence and product lines [1] Financial Performance - Core & Main reported third-quarter earnings per share (EPS) of $0.69, with revenue increasing 11.5% year-over-year to a record $2.04 billion [1] - Adjusted EBITDA reached an all-time high of $277 million, surpassing consensus estimates [1] - Sales gains were primarily driven by acquisitions and higher end-market volumes [1] Outlook and Guidance - Core & Main raised its fiscal 2024 guidance, projecting net sales between $7.35 billion and $7.45 billion, and adjusted EBITDA between $915 million and $935 million [2] - This is an increase from previous estimates of $7.30 billion to $7.40 billion in sales and $900 million to $930 million in adjusted EBITDA [2] - The company's shares have risen approximately 38% this year [2]

Financial Data and Key Metrics Changes - Core & Main reported record quarterly sales of over $2 billion and adjusted EBITDA of $277 million, achieving nearly 12% sales growth in Q3 2024 [7][38] - Net sales grew approximately 12% in Q3 to $2.04 billion, with acquisitions contributing about 9% of sales growth and organic volumes up mid-single digits [38][39] - Gross margins for the quarter were 26.6%, down from 27% in the prior year, but improved sequentially by 20 basis points from the second quarter [40][41] - Net income decreased to $140 million from $158 million in the prior year, primarily due to higher SG&A and interest expenses [43] - Adjusted EBITDA increased approximately 7% to $277 million, with adjusted EBITDA margins decreasing 60 basis points year-over-year to 13.6% [44] Business Line Data and Key Metrics Changes - The residential end market showed modest growth, with expectations for stronger construction activity if mortgage rates decline [14] - Municipal demand, representing over 40% of the business, demonstrated steady growth historically due to the need to replace aged water infrastructure [16] - Meter sales grew by 24% during the quarter, highlighting the success of product expansion initiatives [19] Market Data and Key Metrics Changes - The U.S. faces a growing disparity between water supply and demand, necessitating significant investments in water infrastructure [9][12] - The Infrastructure Investment & Jobs Act is expected to provide critical funding for water system improvements, with bipartisan support anticipated [12] - Municipal repair and replacement activity remains resilient, with an increase in new project starts observed [15] Company Strategy and Development Direction - Core & Main aims to leverage its extensive product and service portfolio to meet the growing demand for infrastructure upgrades [13] - The company plans to continue its disciplined approach to M&A, having completed five acquisitions during and after the quarter [23][28] - The focus remains on organic growth through geographic expansion and enhancing the private label portfolio [32][33] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the stability of end markets and the positive trajectory of municipal projects funded by the Infrastructure Investment & Jobs Act [60][61] - The company raised its full-year estimates for net sales and adjusted EBITDA, expecting net sales to range from $7.35 billion to $7.45 billion [49] - Management anticipates continued organic growth of 2 to 4 points above market growth through execution of expansion initiatives [51] Other Important Information - The company generated robust operating cash flow of $260 million during the quarter, reflecting over 90% conversion from adjusted EBITDA [46] - Core & Main maintains a strong pipeline of acquisition opportunities and expects to remain acquisitive moving forward [53] - Approximately $379 million remains under the existing share repurchase authorization, with $100 million deployed for share repurchases in Q3 [48][24] Q&A Session Summary Question: Insights on municipal end market expectations - Management noted stable and modest growth in the municipal end market, with IIJA funds becoming more prominent and projects moving from planning to execution [60][61] Question: Breakdown of guidance raise - The guidance raise was primarily driven by recent acquisitions, a better-than-expected quarter, and optimism about end markets [68] Question: Factors affecting growth and margin enhancement for 2025 - Management expects a more typical year for 2025, with slightly positive end market volumes and a commitment to margin enhancement [75] Question: Impact of labor conditions and tariffs - Management indicated minimal impact from labor changes and noted that less than 15% of products are imported, viewing tariffs as neutral to positive [79] Question: Drivers of upside in Q3 performance - The quarter exceeded expectations due to improved construction cycles and the release of deferred projects from Q2 [88] Question: Pricing environment outlook for 2025 - Management anticipates a neutral pricing environment for 2025, with no significant contributors expected to impact pricing [90] Question: Contribution of water treatment initiatives to growth - Management highlighted long-term investments in water treatment capabilities, expecting continued growth in this area [104] Question: Ranking of factors behind gross margin improvement - Strategic sourcing and optimization were the primary drivers of gross margin improvement, with private label contributing as well [111] Question: Allocation of IIJA funding - Approximately one-third of the $55 billion IIJA funding for water has been allocated, with expectations for continued momentum in project bidding [125] Question: Opportunities from recent acquisitions - Recent acquisitions in utility servicing and damage prevention equipment are expected to complement existing offerings and add value for municipal customers [128]

Fiscal 2024 Third Quarter Results DECEMBER 3, 2024 CAUTIONARY STATEMENTS Cautionary Note Regarding Forward-Looking Statements This presentation and accompanying discussion may include "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include, without limitation, all statements other than statements of historical or current facts relating to our intentions, beliefs, assumptions or current expectations concerning, among other th ...

Core & Main (CNM) came out with quarterly earnings of $0.69 per share, beating the Zacks Consensus Estimate of $0.65 per share. This compares to earnings of $0.65 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 6.15%. A quarter ago, it was expected that this distributor of water and fire protection products would post earnings of $0.73 per share when it actually produced earnings of $0.61, delivering a surprise of -16.44%.Over ...

Financial Performance - Net sales for the three months ended October 27, 2024, were $2,038 million, an increase from $1,827 million in the same period last year, representing a growth of 11.5%[17] - Gross profit for the nine months ended October 27, 2024, was $1,529 million, compared to $1,434 million for the same period last year, reflecting a year-over-year increase of 6.6%[17] - Operating income for the three months ended October 27, 2024, was $223 million, slightly up from $217 million in the prior year, indicating a growth of 2.8%[17] - Net income attributable to Core & Main, Inc. for the three months ended October 27, 2024, was $133 million, compared to $112 million for the same period last year, marking a 18.8% increase[17] - The total comprehensive income attributable to Core & Main, Inc. for the three months ended October 27, 2024, was $124 million, up from $109 million in the prior year, indicating a growth of 13.8%[19] - Net income for the period ending October 27, 2024, is reported at $140 million, reflecting an increase from previous periods[22] - Net income for the three months ended October 29, 2023, was $156 million, with a total of $368 million for the nine months ended October 27, 2024[58] - Net income available to Class A common stock for the nine months ended October 27, 2024, was $347 million, with a net income per share of $1.81[82] Assets and Liabilities - Total assets as of October 27, 2024, were $6,215 million, up from $5,069 million as of January 28, 2024, representing a growth of 22.6%[14] - Total liabilities increased to $4,465 million as of October 27, 2024, from $3,545 million as of January 28, 2024, reflecting a rise of 25.9%[14] - The company’s long-term debt increased to $2,384 million as of October 27, 2024, from $1,863 million as of January 28, 2024, reflecting a rise of 27.8%[14] - As of October 27, 2024, total stockholders' equity stands at $1,750 million, with common shares totaling 190,189,434[22] - The carrying amount of goodwill as of October 27, 2024, was $1.884 billion, an increase from $1.561 billion as of January 28, 2024[60] - The company's intangible assets included customer relationships valued at $1.768 billion as of October 27, 2024, with accumulated amortization of $829 million[61] Cash Flow and Capital Management - Cash and cash equivalents stood at $10 million as of October 27, 2024, compared to $1 million as of January 28, 2024, showing a significant increase[14] - Cash flows from operating activities for the nine months ended October 29, 2023, provided $775 million, a decrease from $386 million in the current period[28] - The company repurchased and retired equity interests amounting to $100 million, reflecting a strategic move to manage capital structure[22] - The company repurchased 2,890,483 shares of Class A common stock for a total of $121 million during the nine months ended October 27, 2024[32] - The company’s total consideration paid for repurchase transactions during fiscal 2023 amounted to $1,078 million[37] Acquisitions and Growth - The company completed acquisitions during the nine months ended October 27, 2024, with an aggregate transaction value of $748 million, compared to $161 million for the same period in 2023[47] - Total assets acquired in Fiscal 2024 amounted to $876 million, significantly higher than $199 million in Fiscal 2023[53] - Net assets acquired in Fiscal 2024 were $753 million, compared to $159 million in Fiscal 2023[53] - The total consideration for acquisitions in Fiscal 2024, net of cash, was $722 million, up from $151 million in Fiscal 2023[53] - Goodwill from Fiscal 2024 acquisitions was $322 million, while goodwill from Fiscal 2023 acquisitions was $17 million[60] Revenue Breakdown - The company reported revenue from pipes, valves, and fittings products of $1,386 million for the three months ended October 27, 2024, up from $1,222 million in the same period of 2023, indicating a growth of 13.4%[45] - The company’s revenue from storm drainage products increased to $327 million for the three months ended October 27, 2024, compared to $290 million in the same period of 2023, reflecting a growth of 12.8%[45] - The company’s revenue from fire protection products decreased to $145 million for the three months ended October 27, 2024, down from $170 million in the same period of 2023, a decline of 14.7%[45] - The company’s revenue from meter products increased to $180 million for the three months ended October 27, 2024, compared to $145 million in the same period of 2023, representing a growth of 24.1%[45] Debt and Interest Rates - The company's total debt as of October 27, 2024, was $2.430 billion, reflecting various long-term debt obligations[63] - Core & Main LP amended the $1,500 million 2028 Senior Term Loan, reducing the effective applicable margin from 2.60% to 2.00%[64] - The weighted average interest rate for the 2028 Senior Term Loan was 6.86% as of October 27, 2024, with a fair value of $1,449 million[64] - An additional $750 million 2031 Senior Term Loan was entered into, maturing on February 9, 2031, with a weighted average interest rate of 7.11%[64] - Each one percentage point change in interest rates would result in an approximately $22 million change in annual interest expense under the Senior Term Loan Credit Facility[161] Tax and Regulatory Matters - Core & Main LP's effective tax rate increased to 25.1% for the three months ended October 27, 2024, compared to 19.8% for the same period in 2023[71] - The company recorded payables under Tax Receivable Agreements of $721 million as of October 27, 2024, with expected payments of $19 million in the next 12 months[72] Operational Highlights - The company has approximately 350 branches across 49 states, providing specialized distribution services[30] - The Company’s largest customer accounted for less than 1% of net sales, indicating a diverse customer base[162] - The company aims to recover increases in product costs by passing them on to customers, which may affect gross profit margins[164]

News Release FOR IMMEDIATE RELEASE Core & Main Announces Record Fiscal 2024 Third Quarter Results ST. LOUIS, Dec. 3, 2024—Core & Main Inc. (NYSE: CNM), a leading specialty distributor dedicated to advancing reliable infrastructure with local service, nationwide, today announced financial results for the third quarter ended October 27, 2024. Fiscal 2024 Third Quarter Results (Compared with Fiscal 2023 Third Quarter) • Net sales increased 11.5% to $2,038 million • Gross profit increased 9.9% to $543 million; ...

Core & Main, Inc. CNM will release earnings results for the third quarter, before the opening bell on Tuesday, Dec. 3.Analysts expect Core & Main to report quarterly earnings at 66 cents per share. That's up from 52 cents per share a year ago. The Saint Louis, Missouri-based company projects to report quarterly revenue of $1.99 billion, compared to $1.83 billion a year earlier, according to data from Benzinga Pro.On Nov. 7, Core & Main said it has closed its previously announced acquisition of substantially ...