DB:GA8

Stock Analysis Report

Executive Summary

Graco Inc. designs, manufactures, and markets systems and equipment used to move, measure, control, dispense, and spray fluid and powder materials worldwide.

Snowflake

Fundamentals

Flawless balance sheet with outstanding track record and pays a dividend.


Similar Companies

Share Price & News

How has Graco's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

1.0%

GA8

1.9%

DE Machinery

2.4%

DE Market


1 Year Return

22.7%

GA8

-14.9%

DE Machinery

4.9%

DE Market

Return vs Industry: GA8 exceeded the German Machinery industry which returned -14.9% over the past year.

Return vs Market: GA8 exceeded the German Market which returned 4.9% over the past year.


Shareholder returns

GA8IndustryMarket
7 Day1.0%1.9%2.4%
30 Day-0.08%-3.5%2.3%
90 Day-7.3%-4.1%2.7%
1 Year24.4%22.7%-12.2%-14.9%8.2%4.9%
3 Year-38.6%-41.0%-15.7%-21.7%18.3%8.0%
5 Year-25.4%-30.8%21.6%7.3%44.2%24.6%

Price Volatility Vs. Market

How volatile is Graco's share price compared to the market and industry in the last 5 years?


Simply Wall St News

No news available

Valuation

Is Graco undervalued compared to its fair value and its price relative to the market?

22.54x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: GA8 (€41.2) is trading above our estimate of fair value (€40.76)

Significantly Below Fair Value: GA8 is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: GA8 is poor value based on its PE Ratio (22.5x) compared to the Machinery industry average (14.1x).

PE vs Market: GA8 is poor value based on its PE Ratio (22.5x) compared to the German market (19.2x).


Price to Earnings Growth Ratio

PEG Ratio: GA8 is poor value based on its PEG Ratio (12.2x)


Price to Book Ratio

PB vs Industry: GA8 is overvalued based on its PB Ratio (8.3x) compared to the DE Machinery industry average (1.4x).


Next Steps

Future Growth

How is Graco forecast to perform in the next 1 to 3 years based on estimates from 9 analysts?

1.8%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: GA8's forecast earnings growth (1.8% per year) is above the savings rate (0.2%).

Earnings vs Market: GA8's earnings (1.8% per year) are forecast to grow slower than the German market (12.8% per year).

High Growth Earnings: GA8's earnings are forecast to grow, but not significantly.

Revenue vs Market: GA8's revenue (3.6% per year) is forecast to grow slower than the German market (5% per year).

High Growth Revenue: GA8's revenue (3.6% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: Insufficient data to determine if GA8's Return on Equity is forecast to be high in 3 years time


Next Steps

Past Performance

How has Graco performed over the past 5 years?

3.4%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: GA8's earnings have grown by 3.4% per year over the past 5 years.

Accelerating Growth: GA8's earnings growth over the past year (19.2%) exceeds its 5-year average (3.4% per year).

Earnings vs Industry: GA8 earnings growth over the past year (19.2%) exceeded the Machinery industry -11.2%.


Return on Equity

High ROE: GA8's Return on Equity (36.9%) is considered high.


Return on Assets

ROA vs Industry: GA8 has a higher Return on Assets than the Machinery industry average last year.


Return on Capital Employed

ROCE Improving: GA8 has significantly improved its Return on Capital Employed over the past 3 years.


Next Steps

Financial Health

How is Graco's financial position?


Financial Position Analysis

Short Term Liabilities: GA8's short term assets ($798.9M) exceeds its short term liabilities ($359.6M)

Long Term Liabilities: GA8's short term assets (798.9M) exceeds its long term liabilities (355.0M)


Debt to Equity History and Analysis

Debt Level: GA8's debt to equity ratio (28.2%) is considered satisfactory

Reducing Debt: GA8's debt to equity ratio has reduced from 81.9% to 28.2% over the past 5 years.

Debt Coverage: GA8's debt is well covered by operating cash flow (138.1%).

Interest Coverage: GA8's interest payments on its debt are well covered by EBIT (29.5x coverage).


Balance Sheet

Inventory Level: GA8 has a high level of physical assets or inventory.

Debt Coverage by Assets: GA8's debt is covered by short term assets (assets are 3.056610x debt).


Next Steps

Dividend

What is Graco's current dividend yield, its reliability and sustainability?

1.38%

Current Dividend Yield


Dividend Yield vs Market

company1.4%marketbottom25%1.5%markettop25%3.8%industryaverage2.4%forecastin3Years1.4%

Current dividend yield vs market & industry


Stability and Growth of Payments

Notable Dividend: GA8's dividend (1.38%) isn’t notable compared to the bottom 25% of dividend payers in the German market (1.46%).

High Dividend: GA8's dividend (1.38%) is low compared to the top 25% of dividend payers in the German market (3.79%).

Stable Dividend: GA8's dividends per share have been stable in the past 10 years.

Growing Dividend: GA8's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (29.9%), GA8's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: GA8's dividends in 3 years are forecast to be well covered by earnings (31.4% payout ratio).


Next Steps

Management

What is the CEO of Graco's salary, the management and board of directors tenure and is there insider trading?

2.0yrs

Average management tenure


CEO

Pat McHale (58yo)

12.3yrs

Tenure

US$6,414,317

Compensation

Mr. Patrick J. McHale, also known as Pat, serves as the Chief Executive Officer of Graco Minnesota Inc. Mr. McHale has been the Chief Executive Officer and President of Graco Inc. since June 12, 2007. He j ...


CEO Compensation Analysis

Compensation vs. Market: Pat's total compensation ($USD6.41M) is about average for companies of similar size in the German market ($USD3.65M).

Compensation vs Earnings: Pat's compensation has been consistent with company performance over the past year.


Management Age and Tenure

2.0yrs

Average Tenure

56.5yo

Average Age

Experienced Management: GA8's management team is considered experienced (2 years average tenure).


Board Age and Tenure

14.0yrs

Average Tenure

63.5yo

Average Age

Experienced Board: GA8's board of directors are seasoned and experienced ( 14 years average tenure).


Insider Trading

Insider Buying: GA8 insiders have only sold shares in the past 3 months.


Recent Insider Transactions

SellUS$252,79113 Sep 19
William Carroll
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares6,000
Max PriceUS$42.13
SellUS$648,85006 Jun 19
Jeffrey Johnson
EntityIndividual
Shares15,000
Max PriceUS$43.26
SellUS$208,58526 Feb 19
William Carroll
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares5,000
Max PriceUS$41.72

Ownership Breakdown


Management Team

  • Mark Sheahan (55yo)

    CFO & Treasurer

    • Tenure: 1.3yrs
    • Compensation: US$1.31m
  • Pat McHale (58yo)

    President

    • Tenure: 12.3yrs
    • Compensation: US$6.41m
  • Dale Johnson (65yo)

    President of Worldwide Contractor Equipment Division

    • Tenure: 2.7yrs
    • Compensation: US$1.20m
  • David Lowe (62yo)

    President of Worldwide Industrial Products Division

    • Tenure: 1.3yrs
    • Compensation: US$1.21m
  • Karen Gallivan (62yo)

    Executive VP

    • Tenure: 14.1yrs
    • Compensation: US$1.18m
  • Caroline Chambers (55yo)

    Executive VP of Information Systems

    • Tenure: 12.1yrs
  • Brian Zumbolo (50yo)

    President of Asia Pacific

    • Tenure: 1.3yrs
  • David Ahlers (61yo)

    Executive Vice President of Human Resources & Corporate Communications

    • Tenure: 9.5yrs
  • Christian Rothe (45yo)

    President of Worldwide Applied Fluid Technologies Division

    • Tenure: 1.3yrs
    • Compensation: US$1.61m
  • Angie Wordell (47yo)

    Executive Vice President of Operations

    • Tenure: 0.8yrs

Board Members

  • Marti Morfitt (61yo)

    Independent Director

    • Tenure: 24yrs
    • Compensation: US$195.90k
  • William Carroll (74yo)

    Independent Director

    • Tenure: 20.3yrs
    • Compensation: US$224.90k
  • Pat McHale (58yo)

    President

    • Tenure: 12.3yrs
    • Compensation: US$6.41m
  • Jack Eugster (73yo)

    Independent Director

    • Tenure: 15.7yrs
    • Compensation: US$204.90k
  • Lee Mitau (70yo)

    Independent Chairman

    • Tenure: 12.3yrs
    • Compensation: US$235.90k
  • Bill Van Sant (80yo)

    Independent Director

    • Tenure: 15.7yrs
    • Compensation: US$204.90k
  • Jody Feragen (63yo)

    Independent Director

    • Tenure: 4.1yrs
    • Compensation: US$204.90k
  • J. Gilligan (64yo)

    Independent Director

    • Tenure: 18.7yrs
    • Compensation: US$212.40k
  • Eric Etchart (62yo)

    Independent Director

    • Tenure: 8.8yrs
    • Compensation: US$204.90k
  • Emily White (40yo)

    Independent Director

    • Tenure: 1.7yrs
    • Compensation: US$204.90k

Company Information

Graco Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Graco Inc.
  • Ticker: GA8
  • Exchange: DB
  • Founded: 1926
  • Industry: Industrial Machinery
  • Sector: Capital Goods
  • Market Cap: US$7.713b
  • Listing Market Cap: US$6.924b
  • Shares outstanding: 166.81m
  • Website: https://www.graco.com

Number of Employees


Location

  • Graco Inc.
  • 88–11th Avenue Northeast
  • Minneapolis
  • Minnesota
  • 55413
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
GGGNYSE (New York Stock Exchange)YesCommon StockUSUSDJan 1980
GA8DB (Deutsche Boerse AG)YesCommon StockDEEURJan 1980

Biography

Graco Inc. designs, manufactures, and markets systems and equipment used to move, measure, control, dispense, and spray fluid and powder materials worldwide. The company’s Industrial segment offers proport ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/21 20:32
End of Day Share Price2019/10/21 00:00
Earnings2019/06/28
Annual Earnings2018/12/28


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.