DXP Enterprises, Inc. (DXPE), an industrial products distributor servicing primarily the oil and gas and food and beverage industries, announced second quarter results this afternoon that topped analysts’ estimates while setting quarterly records on both the top and bottom lines. Revenues surged 120% year over year to $187.8 million vs. consensus of $172.9 million. Net income rose 86.5% to $6.37 million, or 93 cents per share, compared to analysts’ estimates of 86 cents per share.

David R. Little, Chairman and Chief Executive Officer said, “We continue to execute our three-pronged growth strategy of organic growth, operational efficiencies and acquisitions. Our performance of organic growth of 31% and earnings per share growth of 66% illustrates that our execution is gaining market share and creating value for our shareholders. With our ability to enhance profits and grow the companies we acquire plus the opportunities we have for growth through Super Centers, Innovative Pumping Solutions and Supply Chain Solutions our outlook remains strong.”

DXP has shown great skill in identifying and integrating acquisition targets. The industrial supply sector is a highly fragmented market, with the five largest companies accounting for less than 20% of total sales. DXP has consolidated 17 acquisitions in the space since 1996, typically for four to six times EBITDA. Their largest acquisition, Precision Industries, closed on September 10, 2007 for $106 million and diversified the company’s client base, which had been heavily levered to oil and gas, to include more food and beverage exposure.

Shares of DXPE closed at $45.88 today and have traded in a 52-week range of $29.59 – $53.25. With 6.3 million shares outstanding, DXPE has a market cap of $290 million and a trailing 12-month P/E of 14.2. Shares are bid 9% higher after hours at $50.05 on light volume.

Let us hear your thoughts below: