The Winona, Minnesota company reported first-quarter earnings of 37 cents per share on revenue of $1.417 billion. Analysts polled by FactSet were expecting earnings of 37 cents per share on revenue of $1.42 billion.
Shares were down 2.4% to $49.48 in pre-market trading Tuesday.
The company said that pressures related to product cost inflation are rising and that it anticipates taking pricing actions in the second quarter to mitigate these effects.
Net sales rose by nearly 4% year-over-year, with growth due largely to higher unit sales, most notably with safety and janitorial products.
The company reported that its gross profit as a percentage of net sales declined 120 basis points to 45.4% in the first quarter of 2021 from 46.6% in the first quarter of 2020.
This decline came after it had to write down the value of its popular 3-ply masks that remain in inventory, reducing gross profit.
On Monday evening, the company declared a dividend of 28 cents per share to be paid in cash on May 25 to shareholders of record at the close of business on April 26.
Fastenal began paying annual dividends in 1991 and semi-annual dividends in 2003 before expanding to quarterly dividends in 2011. The company says it intends to continue paying quarterly dividends, though that could change based on its financial condition in the future.