CNM Stock Forecast & Price Target

Core & Main has demonstrated a solid financial performance, achieving a gross margin of 26.8%, which reflects a 40 basis point increase compared to the previous year, indicating operational efficiency and effective cost management. The company reported a year-over-year net sales growth of 6.6%, driven by a volume gain of 5% along with contributions from acquisitions, showcasing strong demand across its end markets. Furthermore, management anticipates an improvement in selling, general, and administrative (SG&A) expenses as a percentage of revenues in the latter half of the fiscal year, suggesting potential for enhanced profitability moving forward.

Core & Main faces a negative outlook primarily due to management's revised guidance, which lowered the 2025 Adjusted EBITDA range to $920 million-$940 million, compared to the previous Street estimate of $980 million. This downgrade is attributed to weaker-than-expected residential demand observed in August, which aligns with broader peer trends. Additionally, rising operating expenses further exacerbate the company's financial challenges, leading to a more cautious outlook for its performance in the upcoming periods.