NOW (DNOW) Stock Forecast & Price Target

Dnow is attractive because its CY26 sales guidance was raised to $5.0-$5.1B, EBITDA margin guidance holds near 4.5%, and operating cash flow is now expected at $125-$200M, suggesting improving execution despite ERP disruption. The completed MRC Global acquisition more than doubled annual sales, broadened the mix toward gas utilities and downstream/industrial, and supports management’s view that the combined business can generate roughly $350M of adj. EBITDA in CY27, with longer-term margin potential near 8%. With net debt leverage down to 1.7x in 2Q26, $75M of buybacks executed YTD, and stronger demand plus $30M of annualized synergy savings, the company has a clearer path to earnings, cash flow, and capital deployment upside.

Dnow is viewed negatively because the MRC acquisition’s U.S. ERP rollout is creating a material drag on sales, with 3Q25 missing implied guidance and consensus by roughly $170M and an estimated $100-$150M in lost sales. The disruption may persist into near-to-medium term operations, with roughly 40% of DNOW’s business exposed and an estimated first-year sales hit of about $400M, while weaker upstream activity, project delays, and potential datacenter softness could further pressure demand. Although pro forma trailing 12-month sales were about $5,284M and improved relative to the -21% U.S. rig count decline since 2022, the risk of softer EBITDA near $200M, tariff pass-through limits, and commodity volatility supports a cautious stance.