W.W. Grainger (GWW)
Industrials · NYSE · US
Fundamentals
Valuation and ratings
W.W. Grainger trades at $1,402.03, close to the $1,329.97 our discounted cash flow model puts on the business. On this measure the market and the model broadly agree, so the interesting question is which of them is wrong.
Our moat model scores it 69 out of 100, which is a moat, but not a deep one. A moat is a structural reason competitors cannot take the profits away, and it matters more to a long holding period than any single quarter's numbers do.
It changes hands at 37.0 times earnings. Be careful reading that in isolation: for a cyclical business a low P/E arrives at the top of the cycle, when profits are peaking and about to fall, which is exactly when the shares look cheapest and are not.
About W.W. Grainger
W.W. Grainger, Inc., together with its subsidiaries, distributes maintenance, repair, and operating products and services primarily in North America, Japan, and the United Kingdom. The company operates through two segments, High-Touch Solutions North America and Endless Assortment. It provides safety, security, material handling and storage equipment, pumps and plumbing equipment, cleaning and maintenance, and metalworking and hand tools. The company also offers technical support and inventory management services. It serves smaller businesses to large corporations, government entities, and other institutions, as well as commercial, healthcare, and manufacturing industries 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.
GWW passes 2 of our 30 screens today
Each screen prints the exact criteria it used, and the circumstances in which it is wrong.
Common questions
Is W.W. Grainger (GWW) undervalued?
Against our discounted cash flow estimate of $1,329.97, GWW at $1,402.03 is 5% above fair value. That is one model's answer, not a recommendation, and most of a DCF's output sits in a terminal value nobody can forecast.
What is GWW's P/E ratio?
GWW trades at 37.0 times earnings. A low P/E is not automatically cheap: on a cyclical company it is usually a warning that earnings are at a peak.
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Data from company filings, exchange quotes and SEC EDGAR 13F disclosures. Quotes are delayed. Metrics we do not have are left out rather than estimated. Educational information, not financial advice.