FAST
Fastenal Company
Industrials · Industrial Distribution · United States · Stock
Score Breakdown
Scored for Safe Long-Term Investing profile
Sub-scores are 0–20 each; Model Score is weighted by your selected investment goal. How it works →
Why Ranked Here
- Strong profitability and financial health scores anchor the composite, reflecting best-in-class margins, return on assets, and a near-zero debt load [profitability.net_margin_pct, profitability.roa_pct, financial_health.debt_to_equity].
- Mid-range growth and momentum scores reflect a business that is performing well but not accelerating, consistent with a mature industrial distributor [growth.revenue.yoy, momentum.revenue_quarterly].
- A low dividend score due to the high payout ratio and declining per-share trend weighed on the total, preventing a higher composite result [dividend.payout_ratio, dividend.dps_trend].
Why Not Higher
- The dividend factor scored poorly due to a 79.8% payout ratio and a multi-year decline in dividends per share, which meaningfully reduced the composite score [dividend.payout_ratio, dividend.dps_trend].
- The Supply Chain Reshoring theme assignment did not contribute any score under the current model methodology, leaving potential thematic upside unrecognized [theme.assigned].
Data Confidence
10 / 10
Very High — full data coverage
Why This Score
Grounded in figures from this company's SEC EDGAR filings — not a restatement of the score itself.
Revenue grew from FY2024's $7,546,000,000 to FY2025's $8,200,500,000, a gain of 8.7%. Net income rose 9.4% over the same period, and diluted EPS increased 9.0% from FY2024 to FY2025.
The model awarded a mid-range score, reflecting solid but not exceptional growth rates across revenue, earnings, and per-share metrics — consistent with a mature, steady compounder rather than a high-growth business.
In FY2025, Fastenal posted a net margin of 15.3%, an operating margin of 20.2%, and a return on assets of 24.9%.
These figures indicate highly efficient operations and strong asset utilization, which the model rewarded with a near-top profitability score — particularly the 24.9% return on assets, which signals exceptional capital efficiency.
Fastenal carried a debt-to-equity ratio of just 0.03 in FY2025, against total assets of $5,052,900,000.
An extremely low debt-to-equity ratio signals that the company operates with virtually no financial leverage, which the model recognized as a strong indicator of balance sheet resilience and low insolvency risk.
Over the last four quarters, revenue moved from $2,080,300,000 in 2025Q2 to $2,133,300,000 in 2025Q3, dipped to $2,027,500,000 in 2025Q4, then rebounded to $2,201,700,000 in 2026Q1. Operating income followed a similar pattern — $436,100,000, $441,500,000, $384,200,000, and $447,600,000 — with net income tracking at $330,300,000, $335,500,000, $293,900,000, and $339,800,000 across the same quarters.
The quarterly data shows a mid-year dip in 2025Q4 followed by a strong recovery to new recent highs in 2026Q1 across revenue, operating income, and net income, a pattern the model interpreted as positive momentum overall.
Fastenal's dividend payout ratio in FY2025 was 79.8%, and dividends per share have trended from $1.24 in FY2022 down to $0.78 in FY2024 before a partial recovery to $0.875 in FY2025.
The high payout ratio limits retained earnings available for reinvestment, and the declining per-share dividend trend from FY2022 through FY2024 likely weighed on the model's assessment, resulting in a low dividend score despite the company actively paying dividends.
Fastenal is assigned to the Supply Chain Reshoring macro theme.
Although the company is linked to the Supply Chain Reshoring theme — a macro trend that could benefit industrial distributors — this assignment did not translate into a score under the model's current methodology.
Research Summary
AI-generated analysis reflects data and conditions as of the report date shown above. Verify any specific figures through primary sources before acting on this analysis.
Fastenal is a mature industrial distributor demonstrating steady, reliable performance: revenue grew 8.7% to $8.2 billion in FY2025, with net income rising 9.4% [growth.revenue.yoy, growth.net_income.yoy]. The company's profitability profile is exceptional, with a 20.2% operating margin, 15.3% net margin, and a standout 24.9% return on assets [profitability.operating_margin_pct, profitability.net_margin_pct, profitability.roa_pct]. Its balance sheet is nearly debt-free, with a debt-to-equity ratio of just 0.03 [financial_health.debt_to_equity]. The dividend picture is mixed — the payout ratio of 79.8% and a declining per-share trend from FY2022 to FY2024 temper the overall score [dividend.payout_ratio, dividend.dps_trend].
Plain English
Fastenal is a well-run industrial supply company that grows steadily, makes strong profits, and carries almost no debt — but it pays out most of its earnings as dividends, leaving less room to reinvest and grow faster [growth.revenue.yoy, profitability.roa_pct, financial_health.debt_to_equity, dividend.payout_ratio].
Bull Case vs. Bear Case
Bull Case
- Exceptional capital efficiency: a 24.9% return on assets in FY2025 signals that Fastenal generates substantial profit from its asset base, a hallmark of high-quality businesses [profitability.roa_pct].
- Rock-solid balance sheet with a debt-to-equity ratio of just 0.03 against $5.05 billion in total assets, providing significant financial resilience and flexibility [financial_health.debt_to_equity, financial_health.total_assets].
- Positive quarterly momentum: after a dip in 2025Q4, revenue, operating income, and net income all rebounded to recent highs in 2026Q1, suggesting underlying business strength [momentum.revenue_quarterly, momentum.operating_income_quarterly, momentum.net_income_quarterly].
Bear Case
- Growth rates of roughly 8-9% across revenue, net income, and EPS are solid but not exceptional, consistent with a mature compounder rather than a high-growth opportunity [growth.revenue.yoy, growth.net_income.yoy, growth.eps_diluted.yoy].
- A dividend payout ratio of 79.8% leaves limited retained earnings for reinvestment, potentially constraining future growth capacity [dividend.payout_ratio].
- Dividends per share declined from $1.24 in FY2022 to $0.78 in FY2024 before only partially recovering to $0.875 in FY2025, raising questions about dividend sustainability and trajectory [dividend.dps_trend].
What Could Change the Picture
Bullish Triggers
- If the Supply Chain Reshoring macro trend accelerates, Fastenal as an industrial distributor could see demand meaningfully above its current steady-state growth rate [theme.assigned, growth.revenue.yoy].
- Sustained improvement in quarterly results beyond the 2026Q1 rebound — particularly if operating margins expand further — would reinforce the bull case for this already highly profitable business [momentum.operating_income_quarterly, profitability.operating_margin_pct].
Bearish Triggers
- A reversal of the 2026Q1 recovery — with revenue or net income falling back toward or below 2025Q4 levels — would signal that the dip was a trend rather than a temporary fluctuation [momentum.revenue_quarterly, momentum.net_income_quarterly].
- Further deterioration in dividends per share or a payout ratio that climbs even higher would signal increasing strain on the company's capital allocation flexibility [dividend.dps_trend, dividend.payout_ratio].
Risk Profile
Very Low RiskFastenal's risk profile is assessed as Very Low, supported by an extremely low debt-to-equity ratio of 0.03 and total assets of $5.05 billion with minimal leverage [financial_health.debt_to_equity, financial_health.total_assets]. Quarterly results show a temporary dip in 2025Q4 followed by a strong recovery in 2026Q1, suggesting the business is resilient to short-term fluctuations [momentum.revenue_quarterly, momentum.net_income_quarterly].
Key Catalysts to Watch
The Supply Chain Reshoring macro trend represents a potential demand catalyst for Fastenal as an industrial distributor, though this has not yet been reflected in the model's scoring [theme.assigned].
This report is for educational and research purposes only. It does not constitute financial, investment, legal, or tax advice — always conduct your own due diligence before making investment decisions.