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W.W. Grainger (GWW)
NYSE:GWW
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WW Grainger
(NYSE:GWW)
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Rating:73Outperform
Price Target:
$1,092.00
▲(7.05% Upside)
WW Grainger's strong financial performance and positive earnings call sentiment are the most significant factors driving the score. The company's effective leverage management and revenue growth are notable strengths. However, the stock's valuation and technical indicators suggest a cautious approach, with modest dividend yield and neutral momentum.
WW Grainger (GWW) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$48.60B
Dividend Yield0.86%
Average Volume (3M)270.69K
Price to Earnings (P/E)28.5
Beta (1Y)0.80
Revenue Growth4.83%
EPS Growth-3.60%
CountryUS
Employees23,500
SectorN/A
Sector StrengthN/A
IndustryIndustrial - Distribution
Share Statistics
EPS (TTM)10.21
Shares Outstanding47,549,335
10 Day Avg. Volume304,276
30 Day Avg. Volume270,693
Financial Highlights & Ratios
PEG Ratio4.14
Price to Book (P/B)15.35
Price to Sales (P/S)3.00
P/FCF Ratio32.83
Enterprise Value/Market Cap0.99
Enterprise Value/Revenue2.72
Enterprise Value/Gross Profit6.95
Enterprise Value/Ebitda17.46
Forecast
1Y Price Target
$1,038.50Price Target Upside1.81% Upside
Rating ConsensusHold
Number of Analyst Covering7
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
WW Grainger Business Overview & Revenue Model
Company DescriptionW.W. Grainger, Inc. distributes maintenance, repair, and operating (MRO) products and services in the United States, Japan, Canada, the United Kingdom, and internationally. The company operates through two segments, High-Touch Solutions N.A. and Endless Assortment. It offers safety and security supplies, material handling and storage equipment, pumps and plumbing equipment, cleaning and maintenance supplies, and metalworking and hand tools. It also offers inventory management and technical support services. The company serves businesses, corporations, government entities, and other institutions through sales and service representatives, and electronic and ecommerce channels. W.W. Grainger, Inc. was founded in 1927 and is headquartered in Lake Forest, Illinois.
How the Company Makes MoneyGrainger generates revenue primarily through the sale of its extensive catalog of industrial and maintenance products to businesses and institutions. The company operates on a transactional revenue model, where customers purchase products directly either through its online platform or physical branches. Key revenue streams include sales to commercial customers, government contracts, and supplies for various industries. Grainger also benefits from long-term relationships with suppliers, which often leads to favorable pricing and exclusive product offerings. Additionally, the company leverages technology to enhance customer experience and operational efficiency, contributing to its growth and profitability.
WW Grainger Earnings Call Summary
Earnings Call Date:Oct 31, 2025
(Q3-2025)
| % Change Since: |
Next Earnings Date:Feb 03, 2026
Earnings Call Sentiment Neutral
Grainger reported strong earnings and revenue growth with significant contributions from the Endless Assortment segment and continued shareholder returns. However, the company faces challenges from LIFO inventory valuation headwinds and the need to exit the U.K. market. The impact of the government shutdown also presents a potential risk to future sales.Q3-2025 Updates
Positive Updates
Strong Revenue and Earnings Growth
Grainger reported sales of nearly $4.7 billion for the quarter, up 6.1% on a reported basis or 5.4% on a daily constant currency basis, with diluted EPS increasing by $0.34 to $10.21, marking a 3.4% increase over the prior year.
Endless Assortment Segment Growth
The segment achieved sales growth of 18.2% on a reported basis or 14.6% on a daily constant currency basis, with MonotaRO and Zoro U.S. contributing significantly. Operating margins increased by 100 basis points to 9.8%.
Operating Cash Flow and Shareholder Returns
Operating cash flow was $597 million, with $399 million returned to shareholders through dividends and share repurchases.
Digital and Technological Advancements
Grainger is focusing on tech and AI to enhance customer experience and drive productivity, leveraging proprietary data for better solutions.
Negative Updates
LIFO Inventory Valuation Headwinds
Continued tariff-related LIFO inventory valuation headwinds impacted gross margins, although they were lighter than expected.
Challenges in the U.K. Market
Grainger announced plans to sell its U.K.-based Cromwell business and exit the U.K. market due to post-Brexit economic dynamics.
Government Shutdown Impact
The anticipated impact from the government shutdown is estimated to reduce sales growth, particularly affecting the public sector.
Company Guidance
During the W.W. Grainger Third Quarter 2025 Earnings Conference Call, the company reported strong financial metrics, with total company sales reaching nearly $4.7 billion, reflecting a 6.1% increase on a reported basis and a 5.4% rise on a daily constant currency basis. The company's gross margins were reported at 38.6%, while operating margins stood at 15.2%. Diluted earnings per share (EPS) increased by $0.34 to $10.21. Operating cash flow for the quarter was $597 million, enabling the company to return $399 million to shareholders through dividends and share repurchases. Despite experiencing tariff-related LIFO inventory valuation headwinds, Grainger managed to exceed its August guidance, particularly on the gross margin line. The company also announced its intention to divest its U.K.-based Cromwell business, thereby focusing on growth in North America and Japan. The updated outlook for the remainder of 2025 anticipates a daily organic constant currency sales growth of between 4.4% and 5.1%, with a diluted adjusted EPS range of $39 to $39.75.WW Grainger Financial Statement Overview
Summary
Income Statement
85
Very Positive
Balance Sheet
78
Positive
Cash Flow
72
Positive
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WW Grainger Technical Analysis
Positive
1020.05
Price Trends
959.43
Positive
971.56
Positive
997.05
Positive
Market Momentum
18.78
Negative
66.36
Neutral
80.74
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GWW, the sentiment is Positive. The current price of 1020.05 is above the 20-day moving average (MA) of 966.25, above the 50-day MA of 959.43, and above the 200-day MA of 997.05, indicating a bullish trend. The MACD of 18.78 indicates Negative momentum. The RSI at 66.36 is Neutral, neither overbought nor oversold. The STOCH value of 80.74 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GWW.
WW Grainger Peers Comparison
UnderperformOutperform
Sector (―)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
| ― | ― | ― | ― | ― | ― | ― | |
75 Outperform | $12.57B | 20.27 | 13.06% | 0.70% | 5.28% | 1.97% | |
73 Outperform | $48.60B | 28.53 | 48.98% | 0.86% | 4.83% | -3.60% | |
72 Outperform | $48.61B | 39.70 | 32.74% | 2.09% | 6.92% | 5.98% | |
71 Outperform | $13.91B | 26.68 | 17.61% | 3.38% | -0.71% | -0.17% | |
69 Neutral | $4.78B | 24.05 | 14.34% | 3.97% | -1.35% | -22.24% | |
65 Neutral | $43.94B | 22.71 | 32.90% | 1.35% | 4.92% | 18.72% |
* Sector Average
GWW
WW Grainger
1,020.05
-61.59
-5.69%
FAST
Fastenal Company
42.34
5.79
15.84%
MSM
MSC Industrial
86.10
11.00
14.65%
WSO
Watsco
346.23
-129.09
-27.16%
WCC
Wesco International
258.42
84.32
48.43%
FERG
Ferguson PLC
225.00
50.58
29.00%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.