Core & Main (CNM) | News Based Sentiment Analysis

• On September 2, 2025, Core & Main signed a definitive agreement to acquire Canada Waterworks, a three-branch acquisition expected to enhance service capabilities and expand market reach in Canada. Each branch carries roughly $15 million in annual revenue, initially boosting shares by 2%.
• Core & Main reported Q2 2025 earnings on September 9, 2025, with diluted EPS of $0.70, beating the adjusted consensus estimate of $0.87, and a net income increase of 11.9% to $141 million. However, quarterly sales of $2.093 billion missed the $2.12 billion estimate.
• Following the Q2 earnings report on September 9, 2025, the company lowered its full-year 2025 revenue guidance to $7.6 billion to $7.7 billion (previously $7.6 billion to $7.8 billion) and adjusted EBITDA guidance to $920 million to $940 million (previously $950 million to $1 billion), causing shares to fall 17.40% in pre-market trading.
• Several analysts reacted to the revised guidance on September 10th and September 11th, lowering their price targets. Wells Fargo lowered its target to $58.00 from $70.00, while Truist Securities adjusted theirs to $50.00 from $56.00, citing concerns over the updated outlook.
• Insider selling continued to be a theme throughout September, with CEO Mark R. Witkowski selling 100,000 shares on August 18th at $64.08, contributing to a total of 422,956 shares sold by insiders for $26,343,241. However, Officer Carla D. Harper acquired 2,091 shares on September 3, 2025, and was granted 2,091 restricted stock units (RSUs) on September 5, 2025.
• Core & Main expanded its footprint with new locations in Kansas City, Kansas, and Columbus, Wisconsin, opening after the close of the second fiscal quarter on September 9, 2025.
• Institutional investors continued to hold a significant stake in Core & Main, with 94.19% ownership as of September 2025. UniSuper Management Pty Ltd acquired a new stake of 31,508 shares, and Federation des caisses Desjardins du Quebec increased its holdings by 37.6%.

The Investment Story: September was a mixed month for Core & Main, marked by a strategic acquisition and expansion efforts offset by disappointing Q2 results, lowered guidance, and continued insider selling. The residential market weakness is a key concern moving forward.

What It Means for Investors: The lowered guidance and insider sales raise caution flags, suggesting potential headwinds in the near term. While the Canada Waterworks acquisition offers long-term growth potential, investors should carefully monitor the impact of the residential market decline and the company's ability to navigate these challenges.

Looking Ahead: Investors should closely watch the impact of the lowered guidance on future earnings and monitor any further insider activity. The successful integration of Canada Waterworks and the performance of the new locations will also be crucial factors to assess.

The Bottom Line: Core & Main's investment story has become more complex. The company faces near-term challenges, but its long-term growth potential remains intact. A cautious approach, with close attention to key performance indicators, is warranted.