CNM Stock Forecast & Price Target

Core & Main reported a gross margin of 26.8%, reflecting a 40 basis points increase from the previous year, indicating the company’s ability to improve profitability. The company also achieved a net sales growth of 6.6% year-over-year, driven by a volume gain of 5% and contributions from acquisitions, which underscores its strong market positioning. Furthermore, management anticipates an improvement in SG&A expenses as a percentage of revenues in the latter half of the fiscal year, suggesting operational efficiencies that could enhance overall financial performance.

Core & Main has adjusted its 2025 adjusted EBITDA guidance downward to a range of $920 million to $940 million, falling short of the market consensus of $980 million, primarily due to softer residential demand and increased operating expenses. Additionally, the company has reported weak residential volumes for August, which aligns with the revised projections and reflects broader industry trends as peer companies have also lowered their expectations for calendar Q2 2025. This combination of reduced guidance and declining volumes raises concerns about the company's growth prospects and financial performance in the near term.