Why MSC Industrial Direct (MSM) Is Gaining Today

NEW YORK (TheStreet) -- MSC Industrial Direct (MSM) is climbing on Wednesday after beating earnings expectations in its second quarter.

By midafternoon, shares had added 4.4% to $90.38.

The industrial equipment distributor reported net income of 87 cents a share in the three months to February. Analysts surveyed by Thomson Reuters had anticipated 85 cents a share.

Revenue of $661.5 million was 16.2% higher year over year, but fell short of estimates by $3.11 million.

"The manufacturing environment continues to show improvement. Despite the impact of weather disruptions, we continued to gain share in our core metalworking market and saw accelerated growth rates in our national account and government programs," CEO Erik Gershwind said in a statement.

For its third quarter ending May, the company anticipates sales between $720 million and $732 million and net income of $1.03 to $1.07 a share. Analysts forecast $722.1 million in sales and $1.07 a share net income.

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TheStreet Ratings team rates MSC INDUSTRIAL DIRECT as a Buy with a ratings score of A. TheStreet Ratings Team has this to say about their recommendation:

"We rate MSC INDUSTRIAL DIRECT (MSM) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, expanding profit margins, good cash flow from operations and increase in stock price during the past year. We feel these strengths outweigh the fact that the company has had sub par growth in net income."

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