NYSE:GGG

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

-2.3%

NYSE:GGG

-0.3%

US Machinery

0.2%

US Market


1 Year Return

-3.4%

NYSE:GGG

-8.0%

US Machinery

-0.7%

US Market

GGG outperformed the Machinery industry which returned -6.7% over the past year.

GGG underperformed the Market in United States of America which returned 0.3% over the past year.


Share holder returns

GGGIndustryMarket
7 Day-2.3%-0.3%0.2%
30 Day-9.9%-7.9%-2.7%
90 Day-5.8%-2.4%1.6%
1 Year-2.1%-3.4%-6.1%-8.0%1.6%-0.7%
3 Year87.4%79.9%35.5%26.7%40.0%30.9%
5 Year89.2%75.6%36.8%19.8%53.8%36.8%

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

Valuation

Is Graco undervalued based on future cash flows and its price relative to the stock market?

22.1x

Price to Earnings (PE) ratio


Intrinsic Value Based on Future Cash Flows

Graco's share price is above the future cash flow value, it's not available at a moderate discount (< 20%).

Graco's share price is above the future cash flow value, it's not available at a substantial discount (< 40%).


Price Based on Earnings

Graco is overvalued based on earnings compared to the US Machinery industry average.

Graco is overvalued based on earnings compared to the United States of America market.


Price Based on Expected Growth

Graco is poor value based on expected growth next year.


Price Based on Value of Assets

Graco is overvalued based on assets compared to the US Machinery industry average.


Next Steps

Future Growth

How is Graco expected to perform in the next 1 to 3 years based on estimates from 10 analysts?

3.7%

Forecasted annual earnings growth


Earnings and Revenue Growth Estimates


Future Annual Growth Analysis

Graco's revenue is expected to grow by 3.7% yearly, however this is not considered high growth (20% yearly).

Graco's earnings are expected to grow by 3.7% yearly, however this is not considered high growth (20% yearly).

Graco's revenue growth is positive but not above the United States of America market average.

Graco's earnings growth is positive but not above the United States of America market average.

Graco's earnings growth is expected to exceed the low risk savings rate of 2.7%.


Earnings per Share Growth Estimates


Future Return on Equity

Unable to establish if Graco will efficiently use shareholders’ funds in the future without estimates of Return on Equity.


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

Graco's year on year earnings growth rate has been positive over the past 5 years.

Graco's 1-year earnings growth exceeds its 5-year average (19.2% vs 3.4%)

Graco's earnings growth has exceeded the US Machinery industry average in the past year (19.2% vs 17.5%).


Return on Equity

Graco has efficiently used shareholders’ funds last year (Return on Equity greater than 20%).


Return on Assets

Graco used its assets more efficiently than the US Machinery industry average last year based on Return on Assets.


Return on Capital Employed

Graco has significantly improved its use of capital last year versus 3 years ago (Return on Capital Employed).


Next Steps

Financial Health

How is Graco's financial position?


Financial Position Analysis

Graco is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.

Graco's cash and other short term assets cover its long term commitments.


Debt to Equity History and Analysis

Graco's level of debt (28.2%) compared to net worth is satisfactory (less than 40%).

The level of debt compared to net worth has been reduced over the past 5 years (81.9% vs 28.2% today).

Debt is well covered by operating cash flow (138.1%, greater than 20% of total debt).

Interest payments on debt are well covered by earnings (EBIT is 29.5x coverage).


Balance Sheet

High level of physical assets or inventory.

Debt is covered by short term assets, assets are 3.1x debt.


Next Steps

Dividend

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

1.46%

Expected Dividend Yield


Dividend Yield and Payments Analysis

Graco's pays a lower dividend yield than the bottom 25% of dividend payers in United States of America (1.48%).

Graco's dividend is below the markets top 25% of dividend payers in United States of America (3.83%).

Dividends per share have been stable in the past 10 years.

Dividends per share have increased over the past 10 years.


Current Payout to Shareholders

Dividends paid are well covered by earnings (3.3x coverage).


Future Payout to Shareholders

Dividends after 3 years are expected to be well covered by earnings (3.2x coverage).


Next Steps

Management

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

1.8yrs

Average management tenure


CEO

Pat McHale (58yo)

12.2yrs

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

Pat's remuneration is about average for companies of similar size in United States of America.

Pat's compensation has been consistent with company performance over the past year, both up more than 20%.


Management Age and Tenure

1.8yrs

Average Tenure

56.5yo

Average Age

The average tenure for the Graco management team is less than 2 years, this suggests a new team.


Board Age and Tenure

13.8yrs

Average Tenure

63.5yo

Average Age

The average tenure for the Graco board of directors is over 10 years, this suggests they are a seasoned and experienced board.


Insider Trading

Graco individual insiders have only sold shares in the past 3 months.


Recent Insider Transactions

SellUS$732,75006 Jun 19
Jeffrey Johnson
EntityIndividual
Shares15,000
Max PriceUS$48.85
SellUS$236,70626 Feb 19
William Carroll
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares5,000
Max PriceUS$47.34
SellUS$508,54828 Aug 18
Jack Eugster
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares10,897
Max PriceUS$46.67

Ownership Breakdown


Management Team

  • Mark Sheahan (55yo)

    CFO & Treasurer

    • Tenure: 1.2yrs
    • Compensation: US$1.31m
  • Pat McHale (58yo)

    President

    • Tenure: 12.2yrs
    • Compensation: US$6.41m
  • Dale Johnson (65yo)

    President of Worldwide Contractor Equipment Division

    • Tenure: 2.5yrs
    • Compensation: US$1.20m
  • David Lowe (62yo)

    President of Worldwide Industrial Products Division

    • Tenure: 1.2yrs
    • Compensation: US$1.21m
  • Karen Gallivan (62yo)

    Executive VP

    • Tenure: 13.9yrs
    • Compensation: US$1.18m
  • Caroline Chambers (55yo)

    Executive VP of Information Systems

    • Tenure: 11.9yrs
  • Brian Zumbolo (50yo)

    President of Asia Pacific

    • Tenure: 1.2yrs
  • David Ahlers (61yo)

    Executive Vice President of Human Resources & Corporate Communications

    • Tenure: 9.3yrs
  • Christian Rothe (45yo)

    President of Worldwide Applied Fluid Technologies Division

    • Tenure: 1.2yrs
    • Compensation: US$1.61m
  • Angie Wordell (47yo)

    Executive Vice President of Operations

    • Tenure: 0.7yrs

Board Members

  • Marti Morfitt (61yo)

    Independent Director

    • Tenure: 23.8yrs
    • Compensation: US$195.90k
  • William Carroll (74yo)

    Independent Director

    • Tenure: 20.2yrs
    • Compensation: US$224.90k
  • Pat McHale (58yo)

    President

    • Tenure: 12.2yrs
    • Compensation: US$6.41m
  • Jack Eugster (73yo)

    Independent Director

    • Tenure: 15.5yrs
    • Compensation: US$204.90k
  • Lee Mitau (70yo)

    Independent Chairman

    • Tenure: 12.2yrs
    • Compensation: US$235.90k
  • Bill Van Sant (80yo)

    Independent Director

    • Tenure: 15.5yrs
    • Compensation: US$204.90k
  • Jody Feragen (63yo)

    Independent Director

    • Tenure: 3.9yrs
    • Compensation: US$204.90k
  • J. Gilligan (64yo)

    Independent Director

    • Tenure: 18.5yrs
    • Compensation: US$212.40k
  • Eric Etchart (62yo)

    Independent Director

    • Tenure: 8.7yrs
    • Compensation: US$204.90k
  • Emily White (40yo)

    Director

    • Tenure: 1.5yrs
    • Compensation: US$204.90k

Company Information

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


Key Information

  • Name: Graco Inc.
  • Ticker: GGG
  • Exchange: NYSE
  • Founded: 1926
  • Industry: Industrial Machinery
  • Sector: Capital Goods
  • Market Cap: US$7.561b
  • 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 Analysis2019/08/20 23:39
End of Day Share Price2019/08/20 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.