GRACO INC (GGG) Stock Fundamental Analysis
NYSE:GGG - New York Stock Exchange, Inc. - US3841091040 - Common Stock - Currency: USD
Overall GGG gets a fundamental rating of 7 out of 10. We evaluated GGG against 128 industry peers in the Machinery industry. Both the health and profitability get an excellent rating, making GGG a very profitable company, without any liquidiy or solvency issues. While showing a medium growth rate, GGG is valued expensive at the moment. These ratings could make GGG a good candidate for quality investing.
1. Profitability
1.1 Basic Checks
GGG had positive earnings in the past year.
GGG had a positive operating cash flow in the past year.
In the past 5 years GGG has always been profitable.
GGG had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
The Return On Assets of GGG (16.22%) is better than 94.53% of its industry peers.
Looking at the Return On Equity, with a value of 19.69%, GGG belongs to the top of the industry, outperforming 82.81% of the companies in the same industry.
Looking at the Return On Invested Capital, with a value of 18.12%, GGG belongs to the top of the industry, outperforming 92.19% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for GGG is significantly above the industry average of 10.69%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 16.22% | ||
| ROE | 19.69% | ||
| ROIC | 18.12% |
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
The Profit Margin of GGG (22.70%) is better than 97.66% of its industry peers.
In the last couple of years the Profit Margin of GGG has grown nicely.
Looking at the Operating Margin, with a value of 27.04%, GGG belongs to the top of the industry, outperforming 98.44% of the companies in the same industry.
In the last couple of years the Operating Margin of GGG has remained more or less at the same level.
GGG's Gross Margin of 52.76% is amongst the best of the industry. GGG outperforms 93.75% of its industry peers.
In the last couple of years the Gross Margin of GGG has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 27.04% | ||
| PM (TTM) | 22.7% | ||
| GM | 52.76% |
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
The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so GGG is creating value.
The number of shares outstanding for GGG has been increased compared to 1 year ago.
GGG has more shares outstanding than it did 5 years ago.
The debt/assets ratio for GGG has been reduced compared to a year ago.
2.2 Solvency
GGG has an Altman-Z score of 18.55. This indicates that GGG is financially healthy and has little risk of bankruptcy at the moment.
With an excellent Altman-Z score value of 18.55, GGG belongs to the best of the industry, outperforming 97.66% of the companies in the same industry.
GGG has a debt to FCF ratio of 0.05. This is a very positive value and a sign of high solvency as it would only need 0.05 years to pay back of all of its debts.
GGG's Debt to FCF ratio of 0.05 is amongst the best of the industry. GGG outperforms 91.41% 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 has a better Debt to Equity ratio (0.01) than 81.25% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.01 | ||
| Debt/FCF | 0.05 | ||
| Altman-Z | 18.55 |
ROIC/WACC1.82
WACC9.96%
2.3 Liquidity
GGG has a Current Ratio of 3.61. This indicates that GGG is financially healthy and has no problem in meeting its short term obligations.
Looking at the Current ratio, with a value of 3.61, GGG belongs to the top of the industry, outperforming 83.59% of the companies in the same industry.
A Quick Ratio of 2.53 indicates that GGG has no problem at all paying its short term obligations.
The Quick ratio of GGG (2.53) is better than 82.81% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 3.61 | ||
| Quick Ratio | 2.53 |
3. Growth
3.1 Past
GGG shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -5.07%.
Measured over the past 5 years, GGG shows a small growth in Earnings Per Share. The EPS has been growing by 7.75% on average per year.
GGG shows a decrease in Revenue. In the last year, the revenue decreased by -0.40%.
Measured over the past years, GGG shows a small growth in Revenue. The Revenue has been growing by 5.13% on average per year.
EPS 1Y (TTM)-5.07%
EPS 3Y4.34%
EPS 5Y7.75%
EPS Q2Q%7.69%
Revenue 1Y (TTM)-0.4%
Revenue growth 3Y2.07%
Revenue growth 5Y5.13%
Sales Q2Q%7.33%
3.2 Future
Based on estimates for the next years, GGG will show a quite strong growth in Earnings Per Share. The EPS will grow by 11.74% on average per year.
The Revenue is expected to grow by 9.48% on average over the next years. This is quite good.
EPS Next Y8.57%
EPS Next 2Y8.18%
EPS Next 3Y9.26%
EPS Next 5Y11.74%
Revenue Next Year6.02%
Revenue Next 2Y5.03%
Revenue Next 3Y5.67%
Revenue Next 5Y9.48%
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 accelerating.
The Revenue 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
The Price/Earnings ratio is 30.42, which means the current valuation is very expensive for GGG.
Based on the Price/Earnings ratio, GGG is valued a bit more expensive than 63.28% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 26.55. GGG is around the same levels.
A Price/Forward Earnings ratio of 26.46 indicates a quite expensive valuation of GGG.
Compared to the rest of the industry, the Price/Forward Earnings ratio of GGG indicates a slightly more expensive valuation: GGG is more expensive than 64.84% of the companies listed in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 22.40. GGG is around the same levels.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 30.42 | ||
| Fwd PE | 26.46 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, GGG is valued a bit more expensive than the industry average as 64.84% of the companies are valued more cheaply.
GGG's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 26.07 | ||
| EV/EBITDA | 20.44 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
GGG has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)3.55
PEG (5Y)3.92
EPS Next 2Y8.18%
EPS Next 3Y9.26%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.31%, GGG has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 1.91, GGG pays a bit more dividend than its industry peers.
With a Dividend Yield of 1.31, GGG pays less dividend than the S&P500 average, which is at 2.39.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.31% |
5.2 History
The dividend of GGG is nicely growing with an annual growth rate of 9.78%!
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
36.03% of the earnings are spent on dividend by GGG. This is a low number and sustainable payout ratio.
The dividend of GGG is growing, but earnings are growing more, so the dividend growth is sustainable.
DP36.03%
EPS Next 2Y8.18%
EPS Next 3Y9.26%
85.48
-0.04 (-0.05%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)
Earnings (Next)
Inst Owners90.65%
Inst Owner Change-0.79%
Ins Owners0.85%
Ins Owner Change3.02%
Market Cap14.29B
Analysts70
Price Target90.95 (6.4%)
Short Float %1.9%
Short Ratio3.36
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.31% |
Yearly Dividend1.02
Dividend Growth(5Y)9.78%
DP36.03%
Div Incr Years1
Div Non Decr Years1
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-7.66%
Min EPS beat(2)-17.34%
Max EPS beat(2)2.02%
EPS beat(4)1
Avg EPS beat(4)-5.98%
Min EPS beat(4)-17.34%
Max EPS beat(4)2.02%
EPS beat(8)3
Avg EPS beat(8)-5.21%
EPS beat(12)7
Avg EPS beat(12)-1.35%
EPS beat(16)9
Avg EPS beat(16)-1.98%
Revenue beat(2)0
Avg Revenue beat(2)-1.63%
Min Revenue beat(2)-2.37%
Max Revenue beat(2)-0.89%
Revenue beat(4)0
Avg Revenue beat(4)-2.64%
Min Revenue beat(4)-4.57%
Max Revenue beat(4)-0.89%
Revenue beat(8)0
Avg Revenue beat(8)-3.5%
Revenue beat(12)3
Avg Revenue beat(12)-1.54%
Revenue beat(16)5
Avg Revenue beat(16)-1.06%
PT rev (1m)-1.11%
PT rev (3m)-4.42%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-1.25%
EPS NY rev (1m)-1.54%
EPS NY rev (3m)-1.86%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)1.46%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.09%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 30.42 | ||
| Fwd PE | 26.46 | ||
| P/S | 6.65 | ||
| P/FCF | 26.07 | ||
| P/OCF | 22.74 | ||
| P/B | 5.77 | ||
| P/tB | 8.16 | ||
| EV/EBITDA | 20.44 |
EPS(TTM)2.81
EY3.29%
EPS(NY)3.23
Fwd EY3.78%
FCF(TTM)3.28
FCFY3.84%
OCF(TTM)3.76
OCFY4.4%
SpS12.86
BVpS14.83
TBVpS10.47
PEG (NY)3.55
PEG (5Y)3.92
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 16.22% | ||
| ROE | 19.69% | ||
| ROCE | 22.11% | ||
| ROIC | 18.12% | ||
| ROICexc | 22.71% | ||
| ROICexgc | 34.57% | ||
| OM | 27.04% | ||
| PM (TTM) | 22.7% | ||
| GM | 52.76% | ||
| FCFM | 25.5% |
ROA(3y)17.66%
ROA(5y)17.52%
ROE(3y)22.12%
ROE(5y)23.57%
ROIC(3y)21.05%
ROIC(5y)21.26%
ROICexc(3y)26.67%
ROICexc(5y)27.9%
ROICexgc(3y)38.29%
ROICexgc(5y)42.21%
ROCE(3y)25.69%
ROCE(5y)26.03%
ROICexcg growth 3Y-12.63%
ROICexcg growth 5Y-6.63%
ROICexc growth 3Y-11.33%
ROICexc growth 5Y-5.14%
OM growth 3Y0.31%
OM growth 5Y0.9%
PM growth 3Y1.29%
PM growth 5Y1.94%
GM growth 3Y0.7%
GM growth 5Y0.33%
F-Score5
Asset Turnover0.71
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.01 | ||
| Debt/FCF | 0.05 | ||
| Debt/EBITDA | 0.04 | ||
| Cap/Depr | 87.17% | ||
| Cap/Sales | 3.73% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 93.33% | ||
| Profit Quality | 112.31% | ||
| Current Ratio | 3.61 | ||
| Quick Ratio | 2.53 | ||
| Altman-Z | 18.55 |
F-Score5
WACC9.96%
ROIC/WACC1.82
Cap/Depr(3y)225.5%
Cap/Depr(5y)206.15%
Cap/Sales(3y)7.62%
Cap/Sales(5y)6.78%
Profit Quality(3y)78.75%
Profit Quality(5y)81.48%
High Growth Momentum
Growth
EPS 1Y (TTM)-5.07%
EPS 3Y4.34%
EPS 5Y7.75%
EPS Q2Q%7.69%
EPS Next Y8.57%
EPS Next 2Y8.18%
EPS Next 3Y9.26%
EPS Next 5Y11.74%
Revenue 1Y (TTM)-0.4%
Revenue growth 3Y2.07%
Revenue growth 5Y5.13%
Sales Q2Q%7.33%
Revenue Next Year6.02%
Revenue Next 2Y5.03%
Revenue Next 3Y5.67%
Revenue Next 5Y9.48%
EBIT growth 1Y-7.91%
EBIT growth 3Y2.38%
EBIT growth 5Y6.08%
EBIT Next Year17.03%
EBIT Next 3Y10.94%
EBIT Next 5Y13.22%
FCF growth 1Y124.15%
FCF growth 3Y16.79%
FCF growth 5Y12.12%
OCF growth 1Y43.78%
OCF growth 3Y10.81%
OCF growth 5Y8.23%