Financial Analysis: Fastenal (NASDAQ:FAST) vs. ZKH Group (NYSE:ZKH)

Fastenal (NASDAQ:FAST) and ZKH Group (NYSE:ZKH) are both retail/wholesale companies, but which is the better business? We will compare the two businesses based on the strength of their valuation, institutional ownership, risk, dividends, analyst recommendations, profitability and earnings.

Valuation & Earnings

This table compares Fastenal and ZKH Group’s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Fastenal	$7.35 billion	5.28	$1.16 billion	$2.02	33.54
ZKH Group	$1.23 billion	1.26	-$42.86 million	N/A	N/A

Fastenal has higher revenue and earnings than ZKH Group.

Insider & Institutional Ownership

81.4% of Fastenal shares are held by institutional investors. Comparatively, 9.5% of ZKH Group shares are held by institutional investors. 0.4% of Fastenal shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Analyst Ratings

This is a summary of current recommendations for Fastenal and ZKH Group, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Fastenal	0	4	1	0	2.20
ZKH Group	0	0	1	0	3.00

Fastenal presently has a consensus target price of $67.67, suggesting a potential downside of 0.46%. ZKH Group has a consensus target price of $21.30, suggesting a potential upside of 77.35%. Given ZKH Group’s stronger consensus rating and higher probable upside, analysts clearly believe ZKH Group is more favorable than Fastenal.

Profitability

This table compares Fastenal and ZKH Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Fastenal	15.68%	33.98%	25.49%
ZKH Group	N/A	N/A	N/A

Summary

Fastenal beats ZKH Group on 8 of the 10 factors compared between the two stocks.

About Fastenal

Fastenal Company, together with its subsidiaries, engages in the wholesale distribution of industrial and construction supplies in the United States, Canada, Mexico, North America, and internationally. It offers fasteners, and related industrial and construction supplies under the Fastenal name. The company's fastener products include threaded fasteners, bolts, nuts, screws, studs, and related washers that are used in manufactured products and construction projects, as well as in the maintenance and repair of machines. It also offers miscellaneous supplies and hardware, including pins, machinery keys, concrete anchors, metal framing systems, wire ropes, strut products, rivets, and related accessories. The company serves the manufacturing market comprising original equipment manufacturers; maintenance, repair, and operations customers; non-residential construction market; farmers, truckers, railroads, mining companies, schools, and retail trades; and oil exploration, production, and refinement companies, as well as federal, state, and local governmental entities. Fastenal Company was founded in 1967 and is headquartered in Winona, Minnesota.

About ZKH Group

ZKH Group Limited develops and operates a maintenance, repair, and operating (MRO) products trading and service platform that offers spare parts, chemicals, manufacturing parts, general consumables, and office supplies in the People's Republic of China. The company also provides MRO procurement and management services; digitalized MRO procurement solutions; and logistics and warehousing services. Further, it engages in the production and sale of intelligent warehousing equipment. The company was founded in 1998 and is based in Shanghai, the People's Republic of China.