Analyst Note| Dawit Woldemariam |
Wide-moat Fastenal reported solid fourth-quarter results to end fiscal year 2021. We raised our fair value estimate to $43 from $39 previously, largely due to Morningstar’s updated assumption that a rise in the U.S. corporate tax rate will not occur. Longer-term, we expect Fastenal’s tax rate to be approximately 24%. We also updated our top line expectations, reflecting our view that management will take additional pricing action in the first half of 2022 to offset rising cost inflation.