SiteOne misses Q3 revenue estimates, lifts buyback by $500 million

SiteOne Landscape Supply, Inc. (SITE) said in an 8-K filing that third-quarter 2026 net sales rose 3% to $1.29 billion from a year earlier, while Organic Daily Sales fell 1%. Revenue missed the $1.33 billion consensus estimate compiled by Finnhub.

The company describes itself as the largest and only nationwide full product line wholesale distributor of landscape supplies in the United States, with an established presence in Canada. Its customers are mainly residential and commercial landscape professionals.

Here's how the company did:

• Net sales: $1,291.1 million vs. $1,258.2 million a year earlier
• Diluted EPS: $1.46 vs. $1.31 a year earlier
• Gross profit: $458.5 million vs. $437.2 million a year earlier
• Adjusted EBITDA: $138.3 million vs. $127.5 million a year earlier

The release also said the company's board approved a $500 million increase to its share repurchase program after the quarter ended.

Margins and costs

Gross margin improved 80 basis points to 35.5%, driven mainly by price realization, including fuel surcharges, and the company's commercial initiatives.

Organic Daily Sales fell 1% as lower sales volume and a delay in fall applications from hot and dry weather more than offset higher price inflation. Acquisitions contributed $39.7 million, or 3%, to net sales growth.

Selling, general and administrative expenses rose to $368.7 million from $357.4 million. As a percentage of net sales, they increased 20 basis points to 28.6%, due mainly to higher fuel and healthcare costs and lower sales volume.

Adjusted EBITDA margin improved 60 basis points to 10.7%. "We delivered a solid third quarter performance with 8% growth in Adjusted EBITDA and 60 basis points of Adjusted EBITDA margin expansion," said Chairman and CEO Doug Black, "despite the continued softness in underlying market demand and a delayed fall season due to hot and dry weather in key markets."

The company said it completed one acquisition during the quarter, Patterson Nursery Sales.

Share repurchases

The board approved a $500.0 million increase to the existing share repurchase program. The company said the updated authorization totals about $538.3 million, including about $38.3 million left under the previous $400.0 million authorization.

The new authorization has no expiration date. The company repurchased $62.2 million of shares during the quarter.

"Given our strong balance sheet, cash flow generation, and confidence in the long-term value we can create at SiteOne, we believe the $500 million increase in our share repurchase authorization enhances our ability to create value for shareholders," Black continued.

2026 outlook

The company now expects full-year Organic Daily Sales to be flat to down 1%. That is down from the flat to up 1% range it gave in its July 29 results release.

Organic Daily Sales growth was approximately 2% in October, which the company expects to yield flat to up 1% for the four-month period of July through October.

The company expects Adjusted EBITDA for fiscal 2026 to be in the range of $425 million to $440 million. The outlook does not include unannounced acquisitions, and the company said it does not have sufficient data to provide a reconciliation for it.

The company plans to reduce its workforce and consolidate or close branches in the fourth quarter, with a charge to Adjusted EBITDA of approximately $6 million to $8 million. It still expects Adjusted EBITDA margin to expand slightly in 2026.

The extra week in December, in the fiscal fourth quarter, is expected to reduce full-year Organic Daily Sales growth by approximately 80 basis points and Adjusted EBITDA by $4 million to $5 million.

Balance sheet

Net debt was $522.6 million at Sept. 27, compared with $422.5 million a year earlier. Net debt to Adjusted EBITDA for the last twelve months was 1.2 times, from 1.0 times.

Cash and cash equivalents were $88.4 million, and available capacity under the ABL Facility was $478.0 million.

According to its SEC filings, net income swung from a profit of $59.1 million in the third quarter of 2025 to a loss of $7.8 million in the fourth quarter of 2025.