NYSE:GGG

Stock Analysis Report

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Executive Summary

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

Rewards

Earnings are forecast to grow 11.63% per year

Risk Analysis

No risks detected for GGG from our risk checks.


Snowflake Analysis

Flawless balance sheet average dividend payer.


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

Stable Share Price: GGG is less volatile than 75% of US stocks over the past 3 months, typically moving +/- 3% a week.

Volatility Over Time: GGG's weekly volatility (3%) has been stable over the past year.


Market Performance


7 Day Return

0.05%

GGG

0.4%

US Machinery

0.6%

US Market


1 Year Return

40.2%

GGG

24.1%

US Machinery

21.0%

US Market

Return vs Industry: GGG exceeded the US Machinery industry which returned 25% over the past year.

Return vs Market: GGG exceeded the US Market which returned 22% over the past year.


Shareholder returns

GGGIndustryMarket
7 Day0.05%0.4%0.6%
30 Day7.0%7.1%4.2%
90 Day14.4%17.5%12.4%
1 Year42.1%40.2%27.2%24.1%23.7%21.0%
3 Year65.6%59.4%32.1%22.6%47.4%37.6%
5 Year276.2%252.4%187.9%156.6%131.6%105.9%

Long-Term 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 compared to its fair value and its price relative to the market?

41.71x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: GGG ($75) is trading above our estimate of fair value ($52.01)

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


Price To Earnings Ratio

PE vs Industry: GGG is poor value based on its PE Ratio (41.7x) compared to the US Machinery industry average (32.9x).

PE vs Market: GGG is poor value based on its PE Ratio (41.7x) compared to the US market (21.1x).


Price to Earnings Growth Ratio

PEG Ratio: GGG is poor value based on its PEG Ratio (3.6x)


Price to Book Ratio

PB vs Industry: GGG is overvalued based on its PB Ratio (10.8x) compared to the US Machinery industry average (3.1x).


Next Steps

Future Growth

How is Graco forecast to perform in the next 1 to 3 years based on estimates from 11 analysts?

11.6%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: GGG's forecast earnings growth (11.6% per year) is above the savings rate (2%).

Earnings vs Market: GGG's earnings (11.6% per year) are forecast to grow slower than the US market (21.6% per year).

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

Revenue vs Market: GGG's revenue (5.6% per year) is forecast to grow slower than the US market (10.2% per year).

High Growth Revenue: GGG's revenue (5.6% 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 GGG'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?

9.3%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: GGG has high quality earnings.

Growing Profit Margin: GGG's current net profit margins (18.9%) are lower than last year (20.3%).


Past Earnings Growth Analysis

Earnings Trend: GGG's earnings have grown by 9.3% per year over the past 5 years.

Accelerating Growth: GGG's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: GGG had negative earnings growth (-9.7%) over the past year, making it difficult to compare to the Machinery industry average (-15.5%).


Return on Equity

High ROE: GGG's Return on Equity (25.8%) is considered high.


Next Steps

Financial Health

How is Graco's financial position?


Financial Position Analysis

Short Term Liabilities: GGG's short term assets ($1.1B) exceed its short term liabilities ($326.5M).

Long Term Liabilities: GGG's short term assets ($1.1B) exceed its long term liabilities ($501.6M).


Debt to Equity History and Analysis

Debt Level: GGG's debt to equity ratio (27.4%) is considered satisfactory.

Reducing Debt: GGG's debt to equity ratio has reduced from 60.5% to 27.4% over the past 5 years.

Debt Coverage: GGG's debt is well covered by operating cash flow (119.7%).

Interest Coverage: GGG's interest payments on its debt are well covered by EBIT (35.2x coverage).


Balance Sheet


Next Steps

Dividend

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

1.00%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: GGG's dividend (1%) isn’t notable compared to the bottom 25% of dividend payers in the US market (1.38%).

High Dividend: GGG's dividend (1%) is low compared to the top 25% of dividend payers in the US market (3.88%).


Stability and Growth of Payments

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

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


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (38.9%), GGG's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: GGG's dividends in 3 years are forecast to be well covered by earnings (33.5% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

2.6yrs

Average management tenure


CEO

Pat McHale (59 yo)

13.58yrs

Tenure

US$8,520,558

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 ($USD8.52M) is about average for companies of similar size in the US market ($USD10.54M).

Compensation vs Earnings: Pat's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Patrick McHale
President13.58yrsUS$8.52m0.12%
$ 15.0m
Mark Sheahan
CFO & Treasurer2.58yrsUS$1.98m0.039%
$ 4.9m
Dale Johnson
President of Worldwide Contractor Equipment Division3.92yrsUS$2.04m0.13%
$ 16.7m
Jeffrey Johnson
President of Electric Motor Division2.58yrsUS$977.33k0.017%
$ 2.2m
Christian Rothe
President of Worldwide Applied Fluid Technologies Division2.58yrsUS$1.08m0.014%
$ 1.8m
Angela Wordell
Executive VP of Operations and President of the Worldwide Oil & Natural Gas Division2.08yrsno data0.0082%
$ 1.0m
Kathryn Schoenrock
Executive VP0.42yrno data0.0020%
$ 251.3k
Karen Gallivan
Executive VP15.33yrsUS$1.18m0.029%
$ 3.7m
David Ahlers
Executive Vice President of Human Resources & Corporate Communications10.75yrsno data0.038%
$ 4.7m
David Lowe
President of the Worldwide Process Division8.75yrsUS$1.21m0.33%
$ 41.3m
Caroline Chambers
President of EMEA0.42yrno data0.018%
$ 2.3m
Brian Zumbolo
President of Asia Pacific2.58yrsno data0.017%
$ 2.1m

2.6yrs

Average Tenure

57.5yo

Average Age

Experienced Management: GGG's management team is considered experienced (2.6 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Patrick McHale
President13.58yrsUS$8.52m0.12%
$ 15.0m
Martha A. Morfitt
Independent Director25.25yrsUS$243.91k0.11%
$ 14.4m
Jack Eugster
Independent Director16.92yrsUS$208.91k0.058%
$ 7.3m
Lee Mitau
Independent Chairman13.58yrsUS$279.91k0.10%
$ 12.6m
Robert Van Sant
Independent Director16.92yrsUS$208.91k0%
$ 0
Jody Feragen
Independent Director5.33yrsUS$208.91k0.021%
$ 2.7m
J. Gilligan
Independent Director19.92yrsUS$216.41k0.028%
$ 3.5m
Eric Etchart
Independent Director10.08yrsUS$208.91k0.017%
$ 2.1m
Kevin Wheeler
Independent Director0.92yrno datano data
Emily White
Independent Director2.92yrsUS$208.91k0.0030%
$ 380.7k

13.6yrs

Average Tenure

63.5yo

Average Age

Experienced Board: GGG's board of directors are seasoned and experienced ( 13.6 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

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$12.566b
  • Shares outstanding: 167.54m
  • 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 Analysis2021/01/14 23:22
End of Day Share Price2021/01/14 00:00
Earnings2020/09/25
Annual Earnings2019/12/27


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.