Fastenal Co. (FAST) Slid on Soft US Industrial Manufacturing

Core Insights - Fenimore Asset Management's Q4 2025 investor letter indicates a solid yet volatile stock market, influenced by AI enthusiasm, economic uncertainty, and monetary policy concerns [1] - The firm anticipates mixed market conditions in 2026, with many AI-related stocks appearing expensive while high-quality companies are trading at multi-year lows, presenting potential investment opportunities [1] Performance Summary - The S&P 500 Index rose by 2.66% in Q4 2025, driven by large-cap technology and communication services stocks [1] - Fenimore Small Cap Strategy returned -4.12%, underperforming the Russell 2000 Index, which returned 2.19% [1] - Fenimore Dividend Focus Strategy declined -4.41% compared to the Russell Midcap Index's 0.16% return [1] - Fenimore Value Strategy saw a decline of -1.17% in Q4, also underperforming the Russell Midcap Index [1] Sector Analysis - Underperformance in Fenimore's strategies was attributed to investments in the financial and industrial sectors, which were net neutral [3] - Fastenal Company (NASDAQ:FAST) was a significant detractor in the Fenimore Value Strategy due to weakness in U.S. industrial manufacturing and production cuts by major customers [3] - Fastenal's gross margin compression was linked to a shift towards lower-margin services and higher inventory costs due to tariff concerns [3] Company Spotlight: Fastenal Company - Fastenal Company (NASDAQ:FAST) had a market capitalization of $49.97 billion and closed at $43.53 per share on January 15, 2026 [2] - The stock experienced a one-month return of 2.79% and a 52-week gain of 14.43% [2]