WW GRAINGER INC (GWW) Stock Fundamental Analysis
USA - NYSE:GWW - US3848021040 - Common Stock
923.47 USD
-2.74 (-0.3%)
923.47 USD
0 (0%)
We assign a fundamental rating of 6 out of 10 to GWW. GWW was compared to 50 industry peers in the Trading Companies & Distributors industry. GWW has outstanding health and profitabily ratings, belonging to the best of the industry. This is a solid base for any company. While showing a medium growth rate, GWW is valued expensive at the moment.
1. Profitability
1.1 Basic Checks
GWW had positive earnings in the past year.
In the past year GWW had a positive cash flow from operations.
GWW had positive earnings in each of the past 5 years.
Each year in the past 5 years GWW had a positive operating cash flow.
1.2 Ratios
The Return On Assets of GWW (19.55%) is better than 98.00% of its industry peers.
GWW's Return On Equity of 48.58% is amongst the best of the industry. GWW outperforms 94.00% of its industry peers.
With an excellent Return On Invested Capital value of 27.94%, GWW belongs to the best of the industry, outperforming 98.00% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for GWW is significantly above the industry average of 9.31%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 19.55% | ||
| ROE | 48.58% | ||
| ROIC | 27.94% |
ROA(3y)21.49%
ROA(5y)18.26%
ROE(3y)59.66%
ROE(5y)54.53%
ROIC(3y)30.88%
ROIC(5y)27.39%
1.3 Margins
Looking at the Profit Margin, with a value of 9.75%, GWW is in the better half of the industry, outperforming 80.00% of the companies in the same industry.
In the last couple of years the Profit Margin of GWW has grown nicely.
With a decent Operating Margin value of 14.05%, GWW is doing good in the industry, outperforming 76.00% of the companies in the same industry.
GWW's Operating Margin has improved in the last couple of years.
GWW has a Gross Margin of 39.09%. This is in the better half of the industry: GWW outperforms 72.00% of its industry peers.
In the last couple of years the Gross Margin of GWW has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 14.05% | ||
| PM (TTM) | 9.75% | ||
| GM | 39.09% |
OM growth 3Y9.16%
OM growth 5Y5.04%
PM growth 3Y11.56%
PM growth 5Y8.51%
GM growth 3Y2.79%
GM growth 5Y0.56%
2. Health
2.1 Basic Checks
GWW has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
Compared to 1 year ago, GWW has less shares outstanding
GWW has less shares outstanding than it did 5 years ago.
GWW has a worse debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 10.73 indicates that GWW is not in any danger for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 10.73, GWW belongs to the top of the industry, outperforming 96.00% of the companies in the same industry.
GWW has a debt to FCF ratio of 1.92. This is a very positive value and a sign of high solvency as it would only need 1.92 years to pay back of all of its debts.
GWW has a better Debt to FCF ratio (1.92) than 82.00% of its industry peers.
A Debt/Equity ratio of 0.66 indicates that GWW is somewhat dependend on debt financing.
GWW's Debt to Equity ratio of 0.66 is in line compared to the rest of the industry. GWW outperforms 48.00% of its industry peers.
Although GWW does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.66 | ||
| Debt/FCF | 1.92 | ||
| Altman-Z | 10.73 |
ROIC/WACC3.29
WACC8.48%
2.3 Liquidity
A Current Ratio of 2.72 indicates that GWW has no problem at all paying its short term obligations.
GWW has a Current ratio of 2.72. This is in the better half of the industry: GWW outperforms 72.00% of its industry peers.
GWW has a Quick Ratio of 1.59. This is a normal value and indicates that GWW is financially healthy and should not expect problems in meeting its short term obligations.
The Quick ratio of GWW (1.59) is better than 64.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.72 | ||
| Quick Ratio | 1.59 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 5.77% over the past year.
Measured over the past years, GWW shows a quite strong growth in Earnings Per Share. The EPS has been growing by 17.64% on average per year.
GWW shows a small growth in Revenue. In the last year, the Revenue has grown by 4.83%.
GWW shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 8.37% yearly.
EPS 1Y (TTM)5.77%
EPS 3Y25.23%
EPS 5Y17.64%
EPS Q2Q%3.44%
Revenue 1Y (TTM)4.83%
Revenue growth 3Y9.65%
Revenue growth 5Y8.37%
Sales Q2Q%6.13%
3.2 Future
The Earnings Per Share is expected to grow by 9.39% on average over the next years. This is quite good.
The Revenue is expected to grow by 6.65% on average over the next years.
EPS Next Y2.38%
EPS Next 2Y6.5%
EPS Next 3Y7.73%
EPS Next 5Y9.39%
Revenue Next Year4.7%
Revenue Next 2Y5.37%
Revenue Next 3Y5.64%
Revenue Next 5Y6.65%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 23.23, the valuation of GWW can be described as rather expensive.
GWW's Price/Earnings is on the same level as the industry average.
When comparing the Price/Earnings ratio of GWW to the average of the S&P500 Index (25.56), we can say GWW is valued inline with the index average.
Based on the Price/Forward Earnings ratio of 20.90, the valuation of GWW can be described as rather expensive.
The rest of the industry has a similar Price/Forward Earnings ratio as GWW.
GWW's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 34.62.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.23 | ||
| Fwd PE | 20.9 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of GWW indicates a slightly more expensive valuation: GWW is more expensive than 60.00% of the companies listed in the same industry.
GWW's Price/Free Cash Flow ratio is in line with the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 35.85 | ||
| EV/EBITDA | 16.75 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
GWW has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)9.78
PEG (5Y)1.32
EPS Next 2Y6.5%
EPS Next 3Y7.73%
5. Dividend
5.1 Amount
GWW has a yearly dividend return of 0.97%, which is pretty low.
Compared to an average industry Dividend Yield of 2.04, GWW pays a bit more dividend than its industry peers.
Compared to an average S&P500 Dividend Yield of 2.44, GWW's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.97% |
5.2 History
On average, the dividend of GWW grows each year by 7.57%, which is quite nice.
GWW has paid a dividend for at least 10 years, which is a reliable track record.
GWW has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)7.57%
Div Incr Years34
Div Non Decr Years34
5.3 Sustainability
26.47% of the earnings are spent on dividend by GWW. This is a low number and sustainable payout ratio.
GWW's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP26.47%
EPS Next 2Y6.5%
EPS Next 3Y7.73%
923.47
-2.74 (-0.3%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryTrading Companies & Distributors
Earnings (Last)
Earnings (Next)
Inst Owners74.36%
Inst Owner Change-2.94%
Ins Owners6.11%
Ins Owner Change-2.19%
Market Cap44.17B
Revenue(TTM)17.75B
Net Income(TTM)1.73B
Analysts57.14
Price Target1050.23 (13.73%)
Short Float %2.33%
Short Ratio3.65
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.97% |
Yearly Dividend8.62
Dividend Growth(5Y)7.57%
DP26.47%
Div Incr Years34
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-0.15%
Min EPS beat(2)-1.9%
Max EPS beat(2)1.6%
EPS beat(4)2
Avg EPS beat(4)0.31%
Min EPS beat(4)-1.9%
Max EPS beat(4)2.89%
EPS beat(8)4
Avg EPS beat(8)0.19%
EPS beat(12)8
Avg EPS beat(12)1.61%
EPS beat(16)12
Avg EPS beat(16)3.53%
Revenue beat(2)0
Avg Revenue beat(2)-0.55%
Min Revenue beat(2)-0.68%
Max Revenue beat(2)-0.42%
Revenue beat(4)0
Avg Revenue beat(4)-0.89%
Min Revenue beat(4)-1.24%
Max Revenue beat(4)-0.42%
Revenue beat(8)0
Avg Revenue beat(8)-1.27%
Revenue beat(12)0
Avg Revenue beat(12)-1.14%
Revenue beat(16)4
Avg Revenue beat(16)-0.33%
PT rev (1m)0.19%
PT rev (3m)-0.3%
EPS NQ rev (1m)-2.81%
EPS NQ rev (3m)-2.14%
EPS NY rev (1m)-0.02%
EPS NY rev (3m)-2.45%
Revenue NQ rev (1m)-2.44%
Revenue NQ rev (3m)-2.33%
Revenue NY rev (1m)-0.19%
Revenue NY rev (3m)0.32%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.23 | ||
| Fwd PE | 20.9 | ||
| P/S | 2.49 | ||
| P/FCF | 35.85 | ||
| P/OCF | 21.57 | ||
| P/B | 12.4 | ||
| P/tB | 15.04 | ||
| EV/EBITDA | 16.75 |
EPS(TTM)39.75
EY4.3%
EPS(NY)44.19
Fwd EY4.79%
FCF(TTM)25.76
FCFY2.79%
OCF(TTM)42.82
OCFY4.64%
SpS371.11
BVpS74.45
TBVpS61.38
PEG (NY)9.78
PEG (5Y)1.32
Graham Number258.05
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 19.55% | ||
| ROE | 48.58% | ||
| ROCE | 36.5% | ||
| ROIC | 27.94% | ||
| ROICexc | 30.31% | ||
| ROICexgc | 33.65% | ||
| OM | 14.05% | ||
| PM (TTM) | 9.75% | ||
| GM | 39.09% | ||
| FCFM | 6.94% |
ROA(3y)21.49%
ROA(5y)18.26%
ROE(3y)59.66%
ROE(5y)54.53%
ROIC(3y)30.88%
ROIC(5y)27.39%
ROICexc(3y)34.68%
ROICexc(5y)30.48%
ROICexgc(3y)38.97%
ROICexgc(5y)34.58%
ROCE(3y)40.34%
ROCE(5y)35.78%
ROICexgc growth 3Y13.79%
ROICexgc growth 5Y5.15%
ROICexc growth 3Y14.65%
ROICexc growth 5Y6.97%
OM growth 3Y9.16%
OM growth 5Y5.04%
PM growth 3Y11.56%
PM growth 5Y8.51%
GM growth 3Y2.79%
GM growth 5Y0.56%
F-Score6
Asset Turnover2.01
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.66 | ||
| Debt/FCF | 1.92 | ||
| Debt/EBITDA | 0.86 | ||
| Cap/Depr | 323.81% | ||
| Cap/Sales | 4.6% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 74.58% | ||
| Profit Quality | 71.21% | ||
| Current Ratio | 2.72 | ||
| Quick Ratio | 1.59 | ||
| Altman-Z | 10.73 |
F-Score6
WACC8.48%
ROIC/WACC3.29
Cap/Depr(3y)184.73%
Cap/Depr(5y)160.05%
Cap/Sales(3y)2.51%
Cap/Sales(5y)2.23%
Profit Quality(3y)79.52%
Profit Quality(5y)87.44%
High Growth Momentum
Growth
EPS 1Y (TTM)5.77%
EPS 3Y25.23%
EPS 5Y17.64%
EPS Q2Q%3.44%
EPS Next Y2.38%
EPS Next 2Y6.5%
EPS Next 3Y7.73%
EPS Next 5Y9.39%
Revenue 1Y (TTM)4.83%
Revenue growth 3Y9.65%
Revenue growth 5Y8.37%
Sales Q2Q%6.13%
Revenue Next Year4.7%
Revenue Next 2Y5.37%
Revenue Next 3Y5.64%
Revenue Next 5Y6.65%
EBIT growth 1Y-4.19%
EBIT growth 3Y19.7%
EBIT growth 5Y13.83%
EBIT Next Year11.06%
EBIT Next 3Y9.38%
EBIT Next 5Y8.46%
FCF growth 1Y-13.3%
FCF growth 3Y32.04%
FCF growth 5Y13.84%
OCF growth 1Y14.61%
OCF growth 3Y31.09%
OCF growth 5Y15.17%
WW GRAINGER INC / GWW FAQ
Can you provide the ChartMill fundamental rating for WW GRAINGER INC?
ChartMill assigns a fundamental rating of 6 / 10 to GWW.
Can you provide the valuation status for WW GRAINGER INC?
ChartMill assigns a valuation rating of 3 / 10 to WW GRAINGER INC (GWW). This can be considered as Overvalued.
What is the profitability of GWW stock?
WW GRAINGER INC (GWW) has a profitability rating of 8 / 10.
Can you provide the PE and PB ratios for GWW stock?
The Price/Earnings (PE) ratio for WW GRAINGER INC (GWW) is 23.23 and the Price/Book (PB) ratio is 12.4.
Is the dividend of WW GRAINGER INC sustainable?
The dividend rating of WW GRAINGER INC (GWW) is 6 / 10 and the dividend payout ratio is 26.47%.