WW GRAINGER INC (GWW) Stock Fundamental Analysis
USA - NYSE:GWW - US3848021040 - Common Stock
952.66 USD
-9.73 (-1.01%)
952.66 USD
0 (0%)
We assign a fundamental rating of 6 out of 10 to GWW. GWW was compared to 51 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.
Each year in the past 5 years GWW has been profitable.
In the past 5 years GWW always reported a positive cash flow from operatings.
1.2 Ratios
GWW has a Return On Assets of 19.55%. This is amongst the best in the industry. GWW outperforms 98.04% of its industry peers.
GWW has a better Return On Equity (43.68%) than 92.16% of its industry peers.
GWW has a Return On Invested Capital of 27.94%. This is amongst the best in the industry. GWW outperforms 96.08% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for GWW is significantly above the industry average of 10.20%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 19.55% | ||
| ROE | 43.68% | ||
| 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
GWW has a better Profit Margin (9.75%) than 80.39% of its industry peers.
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 76.47% 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 72.55% of its industry peers.
GWW's Gross Margin has been stable in the last couple of years.
| 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
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), GWW is creating value.
GWW has less shares outstanding than it did 1 year ago.
Compared to 5 years ago, GWW has less shares outstanding
The debt/assets ratio for GWW is higher compared to a year ago.
2.2 Solvency
The Debt to FCF ratio of GWW is 1.92, which is an excellent value as it means it would take GWW, only 1.92 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of GWW (1.92) is better than 80.39% of its industry peers.
GWW has a Debt/Equity ratio of 0.60. This is a neutral value indicating GWW is somewhat dependend on debt financing.
GWW has a Debt to Equity ratio (0.60) which 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 | 0.6 | ||
| Debt/FCF | 1.92 | ||
| Altman-Z | N/A |
ROIC/WACC2.99
WACC9.33%
2.3 Liquidity
GWW has a Current Ratio of 2.72. This indicates that GWW is financially healthy and has no problem in meeting its short term obligations.
GWW has a Current ratio of 2.72. This is in the better half of the industry: GWW outperforms 70.59% 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.
GWW has a better Quick ratio (1.59) than 66.67% of its industry peers.
| 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%.
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%.
Measured over the past years, GWW shows a quite strong growth in Revenue. The Revenue has been growing by 8.37% on average per year.
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.
Based on estimates for the next years, GWW will show a small growth in Revenue. The Revenue will grow by 6.65% on average per year.
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
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 23.97, GWW is valued on the expensive side.
Compared to the rest of the industry, the Price/Earnings ratio of GWW is on the same level as its industry peers.
GWW's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 26.13.
The Price/Forward Earnings ratio is 21.56, which indicates a rather expensive current valuation of GWW.
GWW's Price/Forward Earnings ratio is in line with the industry average.
GWW is valuated at similar levels of the S&P average when we compare the Price/Forward Earnings ratio to 22.35, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.97 | ||
| Fwd PE | 21.56 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, GWW is valued a bit more expensive than the industry average as 62.75% of the companies are valued more cheaply.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of GWW is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 36.99 | ||
| EV/EBITDA | 17.43 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The excellent profitability rating of GWW may justify a higher PE ratio.
PEG (NY)10.09
PEG (5Y)1.36
EPS Next 2Y6.5%
EPS Next 3Y7.73%
5. Dividend
5.1 Amount
With a yearly dividend of 0.94%, GWW is not a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 1.97, GWW pays a bit more dividend than its industry peers.
With a Dividend Yield of 0.94, GWW pays less dividend than the S&P500 average, which is at 2.39.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.94% |
5.2 History
The dividend of GWW is nicely growing with an annual growth rate of 7.57%!
GWW has been paying a dividend for at least 10 years, so it has 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.
The dividend of GWW is growing, but earnings are growing more, so the dividend growth is sustainable.
DP26.47%
EPS Next 2Y6.5%
EPS Next 3Y7.73%
952.66
-9.73 (-1.01%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryTrading Companies & Distributors
Earnings (Last)
Earnings (Next)
Inst Owners74.36%
Inst Owner Change1.66%
Ins Owners6.11%
Ins Owner Change-0.32%
Market Cap45.57B
Revenue(TTM)17.75B
Net Income(TTM)1.73B
Analysts57.14
Price Target1050.23 (10.24%)
Short Float %2.33%
Short Ratio3.65
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.94% |
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)-4.18%
EPS NQ rev (1m)0.03%
EPS NQ rev (3m)-5.79%
EPS NY rev (1m)0.07%
EPS NY rev (3m)-2.37%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0.45%
Revenue NY rev (1m)0.01%
Revenue NY rev (3m)0.52%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.97 | ||
| Fwd PE | 21.56 | ||
| P/S | 2.57 | ||
| P/FCF | 36.99 | ||
| P/OCF | 22.25 | ||
| P/B | 11.5 | ||
| P/tB | 13.66 | ||
| EV/EBITDA | 17.43 |
EPS(TTM)39.75
EY4.17%
EPS(NY)44.19
Fwd EY4.64%
FCF(TTM)25.76
FCFY2.7%
OCF(TTM)42.82
OCFY4.49%
SpS371.11
BVpS82.81
TBVpS69.75
PEG (NY)10.09
PEG (5Y)1.36
Graham Number272.15
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 19.55% | ||
| ROE | 43.68% | ||
| 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 | 0.6 | ||
| 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 | N/A |
F-Score6
WACC9.33%
ROIC/WACC2.99
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 2 / 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 23.97 and the Price/Book (PB) ratio is 11.5.
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%.