QXO shares rose 20.5% on Monday to close at $13.94, a move that followed the company's preliminary report for the third quarter of 2026, which showed net sales of approximately $4.90 billion, up 79% year over year, and adjusted EBITDA of approximately $557 million, up 85%. The filing states the period includes Kodiak Building Partners and TopBuild Corp., neither of which was in the prior-year comparison, so the year-over-year gains reflect a materially larger business than existed a year ago. The company has not yet filed full quarter-end results, so the attribution of the share move to these preliminary figures remains provisional.
How unusual this move is for QXO
The session was 5.0x the stock's typical daily move of 4.1% over the past year, exceeding the S&P 500's 2.6% rise and the median 5.3% gain among other covered companies in the industry. Trading volume was 1.8x its 30-day average.
Revenue growth and cash conversion
Free cash flow grew more slowly, up 61.4% over the year to $141.2 million against that 408.3% revenue growth, leaving a free-cash-flow margin of 1.4% of revenue, up 5.2 percentage points from a year earlier. Capital spending rose 459.9% while operating cash flow rose 144.3%, so investment absorbed a growing share of the cash the business generated. The trailing operating margin was −3.4%, up 10.4 percentage points from a year earlier; the trailing net margin was −5.2%.
The value hinges on margins more than growth
In our model, a free-cash-flow margin one point lower would cut the value by 38.2%, against 30.5% for growth five points lower. Growth five percentage points higher would raise the value by 39.0%. The value is more sensitive to margin than to growth.
The next full quarter-end filing will show whether the preliminary Q3 figures hold against a comparison base that now includes Kodiak and TopBuild.