GRACO INC (GGG) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:GGG - US3841091040 - Common Stock
87.65 USD
+0.89 (+1.03%)
87.65 USD
0 (0%)
Overall GGG gets a fundamental rating of 7 out of 10. We evaluated GGG against 132 industry peers in the Machinery industry. GGG gets an excellent profitability rating and is at the same time showing great financial health properties. GGG has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
- In the past year GGG was profitable.
- In the past year GGG had a positive cash flow from operations.
- Of the past 5 years GGG 4 years were profitable.
- Of the past 5 years GGG 4 years had a positive operating cash flow.
1.2 Ratios
- GGG has a better Return On Assets (15.41%) than 94.70% of its industry peers.
- With an excellent Return On Equity value of 19.09%, GGG belongs to the best of the industry, outperforming 84.09% of the companies in the same industry.
- Looking at the Return On Invested Capital, with a value of 17.91%, GGG belongs to the top of the industry, outperforming 93.18% of the companies in the same industry.
- Measured over the past 3 years, the Average Return On Invested Capital for GGG is significantly above the industry average of 10.24%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 15.41% | ||
| ROE | 19.09% | ||
| ROIC | 17.91% |
ROA(3y)17.66%
ROA(5y)17.52%
ROE(3y)22.12%
ROE(5y)23.57%
ROIC(3y)21.05%
ROIC(5y)21.26%
1.3 Margins
- GGG has a better Profit Margin (22.72%) than 97.73% of its industry peers.
- GGG's Profit Margin has improved in the last couple of years.
- Looking at the Operating Margin, with a value of 27.61%, GGG belongs to the top of the industry, outperforming 99.24% of the companies in the same industry.
- GGG's Operating Margin has been stable in the last couple of years.
- Looking at the Gross Margin, with a value of 52.68%, GGG belongs to the top of the industry, outperforming 94.70% of the companies in the same industry.
- GGG's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 27.61% | ||
| PM (TTM) | 22.72% | ||
| GM | 52.68% |
OM growth 3Y0.31%
OM growth 5Y0.9%
PM growth 3Y1.29%
PM growth 5Y1.94%
GM growth 3Y0.7%
GM growth 5Y0.33%
2. Health
2.1 Basic Checks
- With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), GGG is creating value.
- GGG has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
2.2 Solvency
- An Altman-Z score of 16.13 indicates that GGG is not in any danger for bankruptcy at the moment.
- GGG has a Altman-Z score of 16.13. This is amongst the best in the industry. GGG outperforms 96.21% of its industry peers.
- GGG has a debt to FCF ratio of 0.06. This is a very positive value and a sign of high solvency as it would only need 0.06 years to pay back of all of its debts.
- The Debt to FCF ratio of GGG (0.06) is better than 92.42% of its industry peers.
- GGG has a Debt/Equity ratio of 0.01. This is a healthy value indicating a solid balance between debt and equity.
- GGG's Debt to Equity ratio of 0.01 is amongst the best of the industry. GGG outperforms 84.09% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.01 | ||
| Debt/FCF | 0.06 | ||
| Altman-Z | 16.13 |
ROIC/WACC1.86
WACC9.63%
2.3 Liquidity
- GGG has a Current Ratio of 3.18. This indicates that GGG is financially healthy and has no problem in meeting its short term obligations.
- GGG has a Current ratio of 3.18. This is in the better half of the industry: GGG outperforms 78.79% of its industry peers.
- A Quick Ratio of 2.27 indicates that GGG has no problem at all paying its short term obligations.
- Looking at the Quick ratio, with a value of 2.27, GGG belongs to the top of the industry, outperforming 81.82% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 3.18 | ||
| Quick Ratio | 2.27 |
3. Growth
3.1 Past
- GGG shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 6.88%.
- The Earnings Per Share has been growing by 8.63% on average over the past years. This is quite good.
EPS 1Y (TTM)6.88%
EPS 3Y3.77%
EPS 5Y8.63%
EPS Q2Q%20.31%
Revenue 1Y (TTM)N/A
Revenue growth 3YN/A
Revenue growth 5YN/A
Sales Q2Q%8.12%
3.2 Future
- GGG is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 12.87% yearly.
- Based on estimates for the next years, GGG will show a quite strong growth in Revenue. The Revenue will grow by 10.66% on average per year.
EPS Next Y8.9%
EPS Next 2Y9.55%
EPS Next 3Y13.76%
EPS Next 5Y12.87%
Revenue Next Year4.74%
Revenue Next 2Y5.42%
Revenue Next 3Y10.16%
Revenue Next 5Y10.66%
3.3 Evolution
- The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- Based on the Price/Earnings ratio of 29.71, the valuation of GGG can be described as expensive.
- Compared to the rest of the industry, the Price/Earnings ratio of GGG is on the same level as its industry peers.
- GGG's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 28.87.
- With a Price/Forward Earnings ratio of 27.28, GGG can be considered very expensive at the moment.
- GGG's Price/Forward Earnings ratio is in line with the industry average.
- GGG's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 25.96.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 29.71 | ||
| Fwd PE | 27.28 |
4.2 Price Multiples
- GGG's Enterprise Value to EBITDA is on the same level as the industry average.
- Compared to the rest of the industry, the Price/Free Cash Flow ratio of GGG indicates a somewhat cheap valuation: GGG is cheaper than 62.88% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 23.25 | ||
| EV/EBITDA | 19.51 |
4.3 Compensation for Growth
- The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates GGG does not grow enough to justify the current Price/Earnings ratio.
- GGG has an outstanding profitability rating, which may justify a higher PE ratio.
- A more expensive valuation may be justified as GGG's earnings are expected to grow with 13.76% in the coming years.
PEG (NY)3.34
PEG (5Y)3.44
EPS Next 2Y9.55%
EPS Next 3Y13.76%
5. Dividend
5.1 Amount
- GGG has a Yearly Dividend Yield of 1.36%. Purely for dividend investing, there may be better candidates out there.
- GGG's Dividend Yield is a higher than the industry average which is at 1.01.
- GGG's Dividend Yield is slightly below the S&P500 average, which is at 1.82.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.36% |
5.2 History
- On average, the dividend of GGG grows each year by 9.78%, which is quite nice.
- GGG has been paying a dividend for at least 10 years, so it has a reliable track record.
- The dividend of GGG decreased recently.
Dividend Growth(5Y)9.78%
Div Incr Years1
Div Non Decr Years1
5.3 Sustainability
- GGG pays out 36.31% of its income as dividend. This is a sustainable payout ratio.
- The dividend of GGG is growing, but earnings are growing more, so the dividend growth is sustainable.
DP36.31%
EPS Next 2Y9.55%
EPS Next 3Y13.76%
GRACO INC / GGG FAQ
Can you provide the ChartMill fundamental rating for GRACO INC?
ChartMill assigns a fundamental rating of 7 / 10 to GGG.
What is the valuation status for GGG stock?
ChartMill assigns a valuation rating of 4 / 10 to GRACO INC (GGG). This can be considered as Fairly Valued.
How profitable is GRACO INC (GGG) stock?
GRACO INC (GGG) has a profitability rating of 8 / 10.
Can you provide the financial health for GGG stock?
The financial health rating of GRACO INC (GGG) is 9 / 10.
Can you provide the expected EPS growth for GGG stock?
The Earnings per Share (EPS) of GRACO INC (GGG) is expected to grow by 8.9% in the next year.