Snap-on Earnings: We Expect Slower Growth in 2024 but Remain Positive on Long-Term Demand

The market sent Snap-on’s shares down approximately 8% in intraday trading, following fourth-quarter earnings. We think investors are worried about growth prospects for the tools business in 2024. We agree the near term will be challenging, but we think Snap-on can still post positive sales growth in 2024. Longer term, we think Snap-on will benefit from solid auto repair demand. These factors together led us to raise our fair value estimate by 2% to $225 (from $221 previously).