Key Stats for DNOW Stock
- Price change for DNOW stock in the last 1 month: 27%
- $DNOW Stock Price as of Aug. 10: $17
- 52-Week High: $17
- $DNOW Stock Price Target: $18
Now Live: Discover how much upside your favorite stocks could have using TIKR’s new Valuation Model (It’s free)>>>
What Happened?
DNOW (DNOW) stock is climbing after the company reported massive Q2 revenue growth and raised its full-year outlook.
Revenue jumped 108.1% year-over-year to $1.31 billion, beating the $1.27 billion analysts expected. Adjusted earnings of $0.12 per share topped the $0.09 consensus estimate by 33%, even though that figure was down 55.6% from a year ago.
The growth came from both sides of the business.
- U.S. revenue reached $1.11 billion, up 110% year-over-year and accounting for 85% of total sales.
- International revenue surged even faster, up 190.4% to $151 million.
- Much of this growth reflects DNOW’s ongoing merger with MRC Global, which is reshaping the company’s scale and reach.
- U.S. midstream revenue crossed $1 billion on an annualized basis for the first time ever, while gas utility and upstream revenue posted their strongest sequential growth since 2022.
- Upstream remained the company’s largest end market at $508 million, followed by gas utilities at $310 million and midstream at $272 million.
- The company also generated a record $133 million in cash from operating activities for the quarter, helping DNOW pay down debt and continue buying back shares.
Net debt leverage improved to 1.7 times EBITDA, and the company ended the quarter with $472 million in total liquidity.
Based on this momentum, DNOW raised its full-year 2026 revenue guidance to $5 billion to $5.1 billion and increased its cash-from-operations forecast to $125 million to $200 million.
Adjusted EBITDA margin is now expected to approach 4.5% for the year.
See analysts’ growth forecasts and price targets for DNOW stock (It’s free) >>>
What the Market Is Telling Us About DNOW Stock
The scale of DNOW’s revenue growth explains why DNOW stock is reacting so strongly.
Beating consensus revenue by over 3% while posting triple-digit year-over-year growth is a rare combination, and it signals that the company’s integration with MRC Global is starting to pay off in a visible way.
There are some costs behind the growth. Gross margin contracted to 18.6% from a year ago, and the company posted a GAAP net loss of $21 million, partly due to a $19 million increase in LIFO reserves and $6 million in transaction-related charges tied to the merger.
Those are largely one-time or accounting-related headwinds rather than signs of a weakening core business.
What seems to matter most to investors is the trajectory.
Cost synergies from the MRC Global integration are now tracking toward a $30 million exit rate by year-end, well above the original $17 million target for 2026.
With record quarterly cash flow, an improving debt profile, and management raising guidance across revenue, margins, and cash generation all at once, the market appears to be rewarding DNOW stock for showing that its merger integration is ahead of schedule rather than behind it.
Estimate a company’s fair value instantly (Free with TIKR) >>>
How Much Upside Does DNOW Stock Have From Here?
With TIKR’s new Valuation Model tool, you can estimate a stock’s potential share price in under a minute.
All it takes is three simple inputs:
- Revenue Growth
- Operating Margins
- Exit P/E Multiple
If you’re not sure what to enter, TIKR automatically fills in each input using analysts’ consensus estimates, giving you a quick, reliable starting point.
From there, TIKR calculates the potential share price and total returns under Bull, Base, and Bear scenarios so you can quickly see whether a stock looks undervalued or overvalued.
See a stock’s true value in under 60 seconds (Free with TIKR) >>>
Looking for New Opportunities?
- See what stocks billionaire investors are buying so you can follow the smart money.
- Analyze stocks in as little as 5 minutes with TIKR’s all-in-one, easy-to-use platform.
- The more rocks you overturn… the more opportunities you’ll uncover. Search 100K+ global stocks, global top investor holdings, and more with TIKR.
Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
