DSGR Stock Forecast & Price Target

Distribution Solutions Group Inc. has demonstrated a strong financial performance, with Q2/25 adjusted EBITDA rising 7.5% year-over-year to $48.6 million, surpassing both internal estimates and consensus expectations. The company also reported a robust revenue increase of 14.3% year-over-year, reaching $502.4 million, again exceeding projections. Additionally, the positive momentum in revenue from the Lawson segment, coupled with ongoing enhancements in its sales processes, suggests a promising trajectory for future growth.

Distribution Solutions Group Inc. faces a negative outlook primarily due to declining revenues in its key segment, TestEquity, which experienced a slight year-over-year decrease of 1.3% attributed to customer uncertainty regarding economic conditions and tariff policies. Additionally, the Lawson Products segment also reported a 1.0% organic decline in revenue, driven by reduced sales volume in the military market amidst tighter government spending. Moreover, overall pressure on the adjusted EBITDA margin reflects ongoing investments in sales transformation amid softer revenue performance across key segments.