Core & Main, Inc. (CNM) shares tumbled 7.30% in pre-market trading on Tuesday, despite the company reporting better-than-expected first-quarter results for fiscal 2025. The sharp decline has left investors puzzled, given the company's solid performance and reaffirmed full-year outlook.

The water infrastructure company reported earnings per share of $0.52, surpassing the analyst consensus estimate of $0.50 by 4%. This represents a 6.12% increase from the $0.49 per share reported in the same period last year. Core & Main's quarterly sales reached $1.91 billion, beating the analyst consensus estimate of $1.85 billion by 3.27% and marking a 9.76% year-over-year increase. Net income for the quarter stood at $105 million, slightly above the estimated $104.8 million.

Despite these positive results, the market's negative reaction suggests investors may be focusing on other factors. One potential concern could be the adjusted EBITDA of $224 million, which fell just short of the $225.2 million estimate. Additionally, while the company reaffirmed its full-year outlook for fiscal 2025, with net sales expected to range between $7.60 billion and $7.80 billion, this guidance aligns with current market expectations and may not have provided the upside some investors were hoping for. The disconnect between Core & Main's financial performance and its stock movement highlights the complex factors that can influence market sentiment, even in the face of seemingly positive results.