Core & Main (NYSE: CNM) trims EBITDA outlook but buys back a record $171 million

What happened

Core & Main, Inc. (NYSE: CNM) trimmed its fiscal 2026 Adjusted EBITDA outlook after preliminary third-quarter results showed 3% sales growth.

The distributor now expects Adjusted EBITDA of $950 million to $960 million for the year, down from $950 million to $980 million. It kept its net sales outlook at $7.8 billion to $7.9 billion.

The company released the update ahead of its appearance at the 2026 Baird Global Industrial Conference. The same release reported three completed acquisitions and a quarterly record for share repurchases.

Key numbers

Metric	Latest	Change	Source
Q3 net sales (preliminary)	$2.12 billion to $2.13 billion	from $2.06 billion, +2.8% to +3.3%	Calculated from SEC 8-K
Q3 net income (preliminary)	$128 million to $140 million	from $143 million, -10.5% to -2.1%	Calculated from SEC 8-K
Q3 Adjusted EBITDA (preliminary, non-GAAP)	$267 million to $275 million	from $274 million, -2.6% to +0.4%	Calculated from SEC 8-K
Fiscal 2026 Adjusted EBITDA outlook	$950 million to $960 million	-$10 million at the midpoint	Calculated from SEC 8-K
Q3 open-market share repurchases	$171 million		SEC 8-K Exhibit 99.1
Combined annual revenue of three acquisitions	Over $250 million		SEC 8-K Exhibit 99.1

Read more: Core & Main (CNM) company research

Third-quarter results

Sales grew but profit did not keep pace. Preliminary net sales for the quarter ended Nov. 1 were $2.12 billion to $2.13 billion, against $2.06 billion a year earlier. OptimistFi calculates growth of 2.8% to 3.3%. The company called the demand environment mixed.

Net income of $128 million to $140 million compares with $143 million a year earlier, a decline of 2.1% to 10.5% by OptimistFi's calculation. Adjusted EBITDA of $267 million to $275 million compares with $274 million, a change from a 2.6% decline to a 0.4% gain.

The company said higher transportation costs and investments in greenfields hurt Adjusted EBITDA. Interest expense rose to $39 million from $30 million. That cuts net income but not Adjusted EBITDA, which excludes it. Acquisition and other expenses added back to reach Adjusted EBITDA were $9 million, up from $3 million.

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Why it matters

The guidance cut is small and falls at the top. The low end held while the high end dropped $20 million. That lowers the midpoint by $10 million to $955 million from $965 million. The net sales outlook did not change.

The company said the outlook reflects stable municipal demand and contributions from completed acquisitions. Softer-than-anticipated residential lot development and light commercial activity partly offset them.

OptimistFi has argued that Core & Main's branch network and purchasing scale turn recurring municipal demand into stable margins and predictable cash. Stable municipal demand fits that view. But OptimistFi calculates Adjusted EBITDA at 12.6% to 12.9% of sales, down from 13.3% a year earlier, so the margin leg of the case is softer this quarter.

The numbers are preliminary and unaudited. PricewaterhouseCoopers LLP has not audited or reviewed them. The company expects final results to land within the ranges but said they could differ materially.

Acquisitions and buybacks

Core & Main completed three acquisitions with more than $250 million in combined annual revenue. In September it bought Southwest Stormwater Solutions, which operates from one location in Phoenix and provides proprietary underground stormwater vault systems.

In October it bought Gajeske, LLC, a Houston-based distributor of fusible HDPE pipe and fittings with eight locations across Texas and Oklahoma. In November it bought KTI Limited and KTI Utility Services, based in Toronto, which offer meter and AMI solutions from seven locations across Ontario and Alberta.

Chief Executive Mark Witkowski tied the deals to acquisitions in storm drainage, fusible HDPE and smart utility solutions. The company also opened a record eight greenfield locations year to date. It listed that investment among the factors that hurt Adjusted EBITDA.

Core & Main repurchased a record $171 million of shares in the open market during the quarter. It was the third straight quarter of record open-market repurchases. Year-to-date repurchases total approximately $428 million, and approximately $240 million remains under the current authorization. That remaining amount is a ceiling on future buybacks, not a commitment.

What's next

Core & Main expects to report full third-quarter fiscal 2026 results on Dec. 8. The test is whether final net income and Adjusted EBITDA land inside the preliminary ranges.

Results near the top of the ranges would ease the margin concern. A result outside them would undercut the preliminary numbers and the updated outlook built on them.

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