Wajax Corporation (TSX:WJX) shares fell roughly 11% on Thursday after the industrial distributor reported second-quarter revenue that missed expectations, even as margins, cash flow and leverage all improved.
Revenue came in at C$515.7 million for the quarter ended June 30, down from C$547.1 million a year earlier. The decline was driven primarily by lower equipment volumes, including the absence of a large mining shovel delivery that had boosted the comparable 2025 quarter. Product support revenue rose 6.9% and engineered repair services (ERS) revenue increased 2.9% year over year, partially offsetting the equipment shortfall.
The stock traded down C$0.60 to C$34.26 on volume of 135,733 shares, about double the 67,335-share average. The sell-off pushed the shares below the consensus analyst price target of C$34.20, which carries a "Hold" rating from the five firms covering the name.
Beneath the top-line miss, the operational picture was notably stronger. Gross profit margin expanded 180 basis points to 20.9%, reflecting margin improvement initiatives and a favorable sales mix. Adjusted basic earnings per share rose to C$0.84 from C$0.77, and adjusted EBITDA margin climbed 70 basis points to 8.9%. Selling and administrative expenses were essentially flat excluding a C$0.6 million unrealized loss on total return swaps.