Hardware products and merchandising solutions provider Hillman (NASDAQ:HLMN) fell short of the market's revenue expectations in Q3 2026, but revenue rose 7.7% year on year to $457.5 million. The company's full-year revenue guidance of $1.67 billion at the midpoint came in 0.7% below analysts' consensus estimates. Its non-GAAP profit of $0.22 per share was 6.1% above analysts' consensus estimates.
For more on Hillman, read our full research report .
Hillman (HLMN) Q3 2026 highlights:
-
Revenue$457.5 million vs S&P analysts' consensus estimates of $461.2 million (7.7% year-on-year growth, 0.8% miss)
-
Adjusted EPS$0.22 vs S&P analysts' consensus estimates of $0.21 (6.1% beat)
-
Adjusted EBITDA$90.15 million vs analysts' consensus estimates of $84.5 million (19.7% margin, 6.7% beat)
-
Revenue guidanceThe company lowered its revenue guidance for the full year to $1.67 billion at the midpoint from $1.70 billion, a 1.5% decrease
-
EBITDA guidance$285 million at the midpoint for the full year, above analysts' consensus estimates of $282.6 million
-
Operating margin8.3%, down from 10.8% in the same quarter last year
-
Free cash flow margin11.2%, up from 2.1% in the same quarter last year
-
Market capitalization$1.52 billion
"The third quarter reflects the continued execution of Hillman's Blueprint for Strategic Growth," commented Hillman's CEO, Jon Michael Adinolfi. "We continue to deliver net sales growth and strong free cash flow generation that give us the flexibility to invest into attractive opportunities, like our high-margin Robotics and Digital Solutions segment - which had a great quarter, up 19.2% - and accretive acquisitions, like Kanebridge."
Revenue growth
A company's long-term revenue performance can indicate its overall quality. Any business can generate a good quarter or two, but the best consistently grow over the long haul. Hillman's revenue grew at a sluggish 3% compounded annual growth rate over the last five years, falling short of our benchmark for the industrials sector.
Long-term growth matters the most, but within industrials, a half-decade historical view may miss cycles, industry trends or a company capitalizing on catalysts such as a new contract win or a successful product line. On the positive side, Hillman's annualized revenue growth of 5.4% over the last two years is above its five-year trend.
This quarter, Hillman's revenue grew by 7.7% year on year to $457.5 million, missing Wall Street's consensus estimates.
Looking ahead, sell-side analysts expect revenue to grow 8.9% over the next 12 months, according to S&P, an improvement versus the last two years. This projection is above average for the sector and suggests its newer products and services will catalyze better top-line performance.
Operating margin
Operating margin is an important measure of profitability as it shows the portion of revenue left after accounting for all core expenses, from the cost of goods sold to advertising and wages. It's also useful for comparing profitability across companies with different levels of debt and tax rates because it excludes interest and taxes.
Hillman was profitable over the last five years but held back by its large cost base. Its average operating margin of 5.1% was weak for an industrials business. This result is surprising given its high gross margin baseline.
On the positive side, Hillman's operating margin rose by 4 percentage points over the last five years, as its revenue growth provided operating leverage.
In Q3, Hillman generated an operating margin of 8.3%, down 2.5 percentage points year on year. Its operating margin decreased more than its gross margin, suggesting reduced efficiency as expenses such as marketing, research and development and administrative overhead increased.
Earnings per share
Revenue trends explain a company's historical growth, but the long-term change in earnings per share, or EPS, points to the profitability of that growth – for example, a company could inflate its revenue through excessive spending on advertising and promotions.
Hillman's full-year EPS grew at an unimpressive 6.8% compounded annual growth rate over the last four years, worse than the broader industrials sector.
As with revenue, we analyze EPS over a more recent period because it can provide insight into an emerging theme or development for the business.
Hillman's weak 3.8% annual EPS growth over the last two years aligns with its revenue trend. On the positive side, this indicates its incremental revenue was profitable.
In Q3, Hillman reported adjusted EPS of $0.22, in line with the same quarter last year. This result beat analysts' consensus estimates by 6.1%. Over the next 12 months, Wall Street expects Hillman's full-year EPS to grow 21% from $0.56 to $0.68, according to S&P.
Key takeaways from Hillman's Q3 results
Hillman's quarter was mixed. EBITDA beat analysts' consensus estimates, and full-year EBITDA guidance came in slightly above Wall Street's consensus. Revenue was the softer spot, slightly missing expectations, with full-year revenue guidance also falling slightly short of Wall Street's consensus estimates. Investors were likely hoping for more, and shares tumbled 6.5% to $7.83 immediately after the results.
To evaluate Hillman as an investment, consider the bigger picture of valuation, business quality and the latest earnings. Read our free full research report for more .
