Insteel Industries 2026 Q1 Earnings Strong Performance as Net Income Surges 602.4%

Insteel Industries (IIIN) reported Q1 2026 earnings on Jan. 15, 2026, with revenue rising 23.3% to $159.92 million and net income soaring 602.4% to $7.59 million. The company guided to $20 million in 2026 capital expenditures for ESM expansion and cost reductions.

Revenue

Revenue growth was driven by a 18.8% increase in average selling prices and a 3.8% rise in shipments. Welded wire reinforcement contributed $108.37 million, while prestressed concrete strand added $51.55 million, reflecting robust demand in infrastructure and commercial construction markets.

Earnings/Net Income

Earnings per share (EPS) surged 550% to $0.39, outpacing the $0.06 in the prior-year quarter. The significant EPS growth indicates strong profitability improvement, supported by wider spreads between selling prices and raw material costs.

Post-Earnings Price Action Review

The strategy of buying IIIN shares after revenue drops and holding for 30 days showed mixed performance over three years, yielding 14.57% versus the S&P 500’s 13.65%. However, the strategy faced a -20.57% drawdown in early 2025 due to a Q3 earnings miss, with volatility higher than the benchmark. Recovery in late 2025 and early 2026 offset this, though the approach remains unsuitable for low-risk investors.

CEO Commentary

CEO H.O. Waltz emphasized resilience in core markets, driven by IIJA funding and infrastructure projects. Challenges include domestic wire rod shortages, prompting offshore imports. The company remains optimistic about 2026 growth in data center construction and cost optimization.

Guidance

Capital expenditures for 2026 are capped at $20 million, with inventory levels expected to moderate in Q2. The tax rate guidance is ~23% for the remainder of the year, with pricing actions in January supporting Q2 margins.

Additional News

Insteel’s Q1 2026 results included a $1.00-per-share special dividend ($19.4 million total) and a $0.03 regular dividend. The company also announced $20 million in capital expenditures for ESM growth and cost reductions. CEO H.O. Waltz highlighted concerns over U.S. steel price premiums versus global markets, noting competitive pressures in import-exposed segments.