WW GRAINGER INC (GWW) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:GWW - US3848021040 - Common Stock
1029.82 USD
-3.51 (-0.34%)
1029.82 USD
0 (0%)
GWW gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 50 industry peers in the Trading Companies & Distributors industry. Both the health and profitability get an excellent rating, making GWW a very profitable company, without any liquidiy or solvency issues. GWW is valied quite expensively at the moment, while it does show a decent growth rate.
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.
In the past 5 years GWW has always been profitable.
GWW had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
Looking at the Return On Assets, with a value of 19.55%, GWW belongs to the top of the industry, outperforming 98.00% of the companies in the same industry.
The Return On Equity of GWW (48.58%) is better than 94.00% of its industry peers.
Looking at the Return On Invested Capital, with a value of 27.94%, GWW belongs to the top 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 9.63%.
| 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 78.00% 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.
In the last couple of years the Operating Margin of GWW has grown nicely.
GWW's Gross Margin of 39.09% is fine compared to the rest of the industry. GWW outperforms 74.00% 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
The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so GWW is creating value.
The number of shares outstanding for GWW has been reduced compared to 1 year ago.
GWW has less shares outstanding than it did 5 years ago.
The debt/assets ratio for GWW is higher compared to a year ago.
2.2 Solvency
GWW has an Altman-Z score of 11.29. This indicates that GWW is financially healthy and has little risk of bankruptcy at the moment.
The Altman-Z score of GWW (11.29) is better than 98.00% of its industry peers.
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's Debt to FCF ratio of 1.92 is amongst the best of the industry. GWW outperforms 82.00% of its industry peers.
GWW has a Debt/Equity ratio of 0.66. This is a neutral value indicating GWW is somewhat dependend on debt financing.
The Debt to Equity ratio of GWW (0.66) is comparable to the rest of the industry.
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 | 11.29 |
ROIC/WACC2.88
WACC9.69%
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 better Current ratio (2.72) than 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.
Looking at the Quick ratio, with a value of 1.59, GWW is in the better half of the industry, outperforming 62.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.72 | ||
| Quick Ratio | 1.59 |
3. Growth
3.1 Past
GWW shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 5.77%.
GWW shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 17.64% yearly.
GWW shows a small growth in Revenue. In the last year, the Revenue has grown by 4.83%.
The Revenue has been growing by 8.37% on average over the past years. This is quite good.
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
GWW is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 9.39% yearly.
GWW is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 6.65% yearly.
EPS Next Y2.39%
EPS Next 2Y6.56%
EPS Next 3Y8.03%
EPS Next 5Y9.39%
Revenue Next Year4.32%
Revenue Next 2Y4.69%
Revenue Next 3Y5.3%
Revenue Next 5Y6.65%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
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 25.91, the valuation of GWW can be described as expensive.
Compared to the rest of the industry, the Price/Earnings ratio of GWW is on the same level as its industry peers.
Compared to an average S&P500 Price/Earnings ratio of 27.19, GWW is valued at the same level.
GWW is valuated rather expensively with a Price/Forward Earnings ratio of 23.28.
Compared to the rest of the industry, the Price/Forward Earnings ratio of GWW is on the same level as its industry peers.
GWW is valuated at similar levels of the S&P average when we compare the Price/Forward Earnings ratio to 23.88, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.91 | ||
| Fwd PE | 23.28 |
4.2 Price Multiples
64.00% of the companies in the same industry are cheaper than GWW, based on the Enterprise Value to EBITDA ratio.
GWW's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. GWW is cheaper than 62.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 39.75 | ||
| EV/EBITDA | 18.56 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates GWW does not grow enough to justify the current Price/Earnings ratio.
The excellent profitability rating of GWW may justify a higher PE ratio.
PEG (NY)10.84
PEG (5Y)1.47
EPS Next 2Y6.56%
EPS Next 3Y8.03%
5. Dividend
5.1 Amount
GWW has a yearly dividend return of 0.87%, which is pretty low.
Compared to an average industry Dividend Yield of 1.01, GWW pays a bit more dividend than its industry peers.
Compared to an average S&P500 Dividend Yield of 1.94, GWW's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.87% |
5.2 History
The dividend of GWW is nicely growing with an annual growth rate of 7.57%!
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 2Y6.56%
EPS Next 3Y8.03%
1029.82
-3.51 (-0.34%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryTrading Companies & Distributors
Earnings (Last)
Earnings (Next)
Inst Owners73.69%
Inst Owner Change0%
Ins Owners6.15%
Ins Owner Change-0.05%
Market Cap48.97B
Revenue(TTM)17.75B
Net Income(TTM)1.73B
Analysts57.14
Price Target1056.24 (2.57%)
Short Float %2.81%
Short Ratio4.22
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.87% |
Yearly Dividend8.62
Dividend Growth(5Y)7.57%
DP26.47%
Div Incr Years34
Div Non Decr Years34
Ex-DateN/A
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)-0.81%
PT rev (3m)0.77%
EPS NQ rev (1m)0.27%
EPS NQ rev (3m)-1.78%
EPS NY rev (1m)0.06%
EPS NY rev (3m)0%
Revenue NQ rev (1m)0.07%
Revenue NQ rev (3m)-2.33%
Revenue NY rev (1m)0.01%
Revenue NY rev (3m)-0.55%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.91 | ||
| Fwd PE | 23.28 | ||
| P/S | 2.76 | ||
| P/FCF | 39.75 | ||
| P/OCF | 23.91 | ||
| P/B | 13.75 | ||
| P/tB | 16.68 | ||
| EV/EBITDA | 18.56 |
EPS(TTM)39.75
EY3.86%
EPS(NY)44.24
Fwd EY4.3%
FCF(TTM)25.91
FCFY2.52%
OCF(TTM)43.07
OCFY4.18%
SpS373.29
BVpS74.89
TBVpS61.75
PEG (NY)10.84
PEG (5Y)1.47
Graham Number258.8
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 | 11.29 |
F-Score6
WACC9.69%
ROIC/WACC2.88
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 Y2.39%
EPS Next 2Y6.56%
EPS Next 3Y8.03%
EPS Next 5Y9.39%
Revenue 1Y (TTM)4.83%
Revenue growth 3Y9.65%
Revenue growth 5Y8.37%
Sales Q2Q%6.13%
Revenue Next Year4.32%
Revenue Next 2Y4.69%
Revenue Next 3Y5.3%
Revenue Next 5Y6.65%
EBIT growth 1Y-4.19%
EBIT growth 3Y19.7%
EBIT growth 5Y13.83%
EBIT Next Year11.28%
EBIT Next 3Y9.02%
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.
What is the valuation status for GWW stock?
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.
How financially healthy is WW GRAINGER INC?
The financial health rating of WW GRAINGER INC (GWW) is 8 / 10.
Can you provide the expected EPS growth for GWW stock?
The Earnings per Share (EPS) of WW GRAINGER INC (GWW) is expected to grow by 2.39% in the next year.