Have you looked into how DNOW (DNOW) performed internationally during the quarter ending March 2025? Considering the widespread global presence of this energy and industrial distribution company, examining the trends in international revenues is essential for assessing its financial resilience and prospects for growth.
In the modern, closely-knit global economic landscape, the capacity of a business to access foreign markets is often a key determinant of its financial well-being and growth path. Investors now place great importance on grasping the extent of a company's dependence on international markets, as it sheds light on the firm's earnings stability, its skill in leveraging various economic cycles and its broad growth potential.
Being present in foreign markets serves as protection against local economic declines and helps benefit from more rapidly expanding economies. Yet, such expansion also introduces challenges related to currency fluctuations, geopolitical uncertainties and varied market behaviors.
While analyzing DNOW's performance for the last quarter, we found some intriguing trends in revenues from its overseas segments that Wall Street analysts commonly model and monitor.
The company's total revenue for the quarter amounted to $599 million, showing rise of 6.4%. We will now explore the breakdown of DNOW's overseas revenue to assess the impact of its international operations.
A Dive into DNOW's International Revenue Trends
Canada generated $62 million in revenues for the company in the last quarter, constituting 10.35% of the total. This represented a surprise of -3.43% compared to the $64.2 million projected by Wall Street analysts. Comparatively, in the previous quarter, Canada accounted for $66 million (11.56%), and in the year-ago quarter, it contributed $66 million (11.72%) to the total revenue.
International accounted for 10.52% of the company's total revenue during the quarter, translating to $63 million. Revenues from this region represented a surprise of +11.31%, with Wall Street analysts collectively expecting $56.6 million. When compared to the preceding quarter and the same quarter in the previous year, International contributed $54 million (9.46%) and $62 million (11.01%) to the total revenue, respectively.
Anticipated Revenues in Overseas Markets
For the current fiscal quarter, it is anticipated by Wall Street analysts that DNOW will report a total revenue of $614.8 million, which reflects a decline of 2.9% from the same quarter in the previous year. The revenue contributions are expected to be 8.2% from Canada ($50.3 million) and 8.7% from International ($53.2 million).
For the full year, the company is expected to generate $2.37 billion in total revenue, up 0.1% from the previous year. Revenues from Canada and International are expected to constitute 9.5% ($225.9 million) and 10.1% ($238.7 million) of the total, respectively.
In Conclusion
DNOW's leaning on foreign markets for its revenue stream presents a mix of chances and challenges. Therefore, a vigilant watch on its international revenue movements can greatly aid in projecting the company's future direction.
In an era of growing international interdependencies and escalating geopolitical disputes, Wall Street analysts are vigilant in tracking these trends for businesses with a global reach, in order to refine their predictions of earnings. It should be noted, however, that a multitude of other elements, such as a company's domestic position, also play a significant role in shaping the earnings forecasts.
We at Zacks strongly focus on the dynamic earnings forecast of companies, given that empirical studies have demonstrated its potent impact on the immediate price movement of stocks. Invariably, there's a positive relationship -- upward earnings predictions often result in an increase in stock prices.
Boasting a remarkable track record that's been externally verified, the Zacks Rank, our unique stock rating system, leverages changes in earnings projections to function as a reliable gauge for predicting short-term stock price movements.
DNOW currently has a Zacks Rank #3 (Hold), indicating that it could perform in line with the broader market in the near term. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>
DNOW's Recent Stock Market Performance
Over the preceding four weeks, the stock's value has diminished by 0.6%, against an upturn of 9.1% in the Zacks S&P 500 composite. In parallel, the Zacks Industrial Products sector, which counts DNOW among its entities, has appreciated by 12.7%. Over the past three months, the company's shares have seen a decline of 11.9% versus the S&P 500's 3.1% decline. The sector overall has witnessed a decline of 2.7% over the same period.
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This article originally published on Zacks Investment Research (zacks.com).
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