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Grainger (GWW) Earnings & Sales Beat Estimates in Q2, Up Y/Y
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W.W. Grainger, Inc. (GWW - Free Report) reported earnings per share (EPS) of $7.19 in second-quarter 2022, beating the Zacks Consensus Estimate of $6.72. The bottom line improved 68% year over year, driven by upbeat demand in both the High-Touch Solutions N.A. and Endless Assortment segments and strong operating performance.
Grainger’s quarterly revenues rose 20% year over year to $3,837 million. The top line surpassed the Zacks Consensus Estimate of $3,723 million. Daily sales increased 22% from the prior-year quarter’s levels. The uptick was driven by a strong performance in both the High-Touch Solutions North America (N.A.) and Endless Assortment segments.
Operational Update
Cost of sales climbed 15% year over year to $2,396 million. The gross profit rose 28% year over year to $1,441 million. The gross margin expanded to 37.6% in the quarter compared with the prior-year period’s 35%.
W.W. Grainger, Inc. Price, Consensus and EPS Surprise
Grainger’s operating income in the quarter was up 60% year on year to $534 million. The operating margin came in at 13.9%, a 350 basis point expansion from the prior-year quarter.
Financial Position
The company had cash and cash equivalents of $262 million at the end of the second quarter of 2022, up from $241 million at the 2021-end. Cash flow from operating activities was $250 million in the second quarter of 2022 compared with $269 million in the last year's quarter.
Long-term debt was $2,309 million as of Jun 30, 2022, compared with $2,362 million as of Dec 31, 2021. Grainger returned $219 million to shareholders through dividends and share buybacks in the reported quarter.
2022 Outlook
Backed by the strong second-quarter performance, Grainger now expects net sales for the current year between $15 billion and $15.2 billion, up from its prior stated range of $14.5 billion to $14.9 billion. The company raised its earnings per share guidance to the band of $27.25-$28.75 from its previous expectation of $25.00-$27.00.
Price Performance
Image Source: Zacks Investment Research
In the past year, Grainger’s shares have gained 12.9% against the industry’s decline of 43.9%.
Zacks Rank and Stocks to Consider
Grainger currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks from the Industrial Products sector are Greif Inc. (GEF - Free Report) , Titan International and Valmont Industries (VMI - Free Report) . Both GEF and TWI sport a Zacks Rank #1 (Strong Buy), while VMI carries a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Greif has an estimated earnings growth rate of 37% for the current year. In the past 60 days, the Zacks Consensus Estimate for current-year earnings has been revised upward by 17%.
Greif pulled off a trailing four-quarter earnings surprise of 22.9%, on average. GEF’s shares have risen 15.5% in the past year.
Titan International has an estimated earnings growth rate of 165% for the current year. In the past 60 days, the Zacks Consensus Estimate for current-year earnings has been revised upward by 43%.
Titan International pulled off a trailing four-quarter earnings surprise of 56.4%, on average. TWI’s shares have soared 88% in a year.
Valmont Industries has an expected earnings growth rate of around 27% for 2022. The Zacks Consensus Estimate for the current year’s earnings has moved up 4% in the past 60 days.
Valmont Industries has a trailing four-quarter earnings surprise of 13.7%, on average. VMI’s shares have gained 14% in the past year.
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Grainger (GWW) Earnings & Sales Beat Estimates in Q2, Up Y/Y
W.W. Grainger, Inc. (GWW - Free Report) reported earnings per share (EPS) of $7.19 in second-quarter 2022, beating the Zacks Consensus Estimate of $6.72. The bottom line improved 68% year over year, driven by upbeat demand in both the High-Touch Solutions N.A. and Endless Assortment segments and strong operating performance.
Grainger’s quarterly revenues rose 20% year over year to $3,837 million. The top line surpassed the Zacks Consensus Estimate of $3,723 million. Daily sales increased 22% from the prior-year quarter’s levels. The uptick was driven by a strong performance in both the High-Touch Solutions North America (N.A.) and Endless Assortment segments.
Operational Update
Cost of sales climbed 15% year over year to $2,396 million. The gross profit rose 28% year over year to $1,441 million. The gross margin expanded to 37.6% in the quarter compared with the prior-year period’s 35%.
W.W. Grainger, Inc. Price, Consensus and EPS Surprise
W.W. Grainger, Inc. price-consensus-eps-surprise-chart | W.W. Grainger, Inc. Quote
Grainger’s operating income in the quarter was up 60% year on year to $534 million. The operating margin came in at 13.9%, a 350 basis point expansion from the prior-year quarter.
Financial Position
The company had cash and cash equivalents of $262 million at the end of the second quarter of 2022, up from $241 million at the 2021-end. Cash flow from operating activities was $250 million in the second quarter of 2022 compared with $269 million in the last year's quarter.
Long-term debt was $2,309 million as of Jun 30, 2022, compared with $2,362 million as of Dec 31, 2021. Grainger returned $219 million to shareholders through dividends and share buybacks in the reported quarter.
2022 Outlook
Backed by the strong second-quarter performance, Grainger now expects net sales for the current year between $15 billion and $15.2 billion, up from its prior stated range of $14.5 billion to $14.9 billion. The company raised its earnings per share guidance to the band of $27.25-$28.75 from its previous expectation of $25.00-$27.00.
Price Performance
Image Source: Zacks Investment Research
In the past year, Grainger’s shares have gained 12.9% against the industry’s decline of 43.9%.
Zacks Rank and Stocks to Consider
Grainger currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks from the Industrial Products sector are Greif Inc. (GEF - Free Report) , Titan International and Valmont Industries (VMI - Free Report) . Both GEF and TWI sport a Zacks Rank #1 (Strong Buy), while VMI carries a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Greif has an estimated earnings growth rate of 37% for the current year. In the past 60 days, the Zacks Consensus Estimate for current-year earnings has been revised upward by 17%.
Greif pulled off a trailing four-quarter earnings surprise of 22.9%, on average. GEF’s shares have risen 15.5% in the past year.
Titan International has an estimated earnings growth rate of 165% for the current year. In the past 60 days, the Zacks Consensus Estimate for current-year earnings has been revised upward by 43%.
Titan International pulled off a trailing four-quarter earnings surprise of 56.4%, on average. TWI’s shares have soared 88% in a year.
Valmont Industries has an expected earnings growth rate of around 27% for 2022. The Zacks Consensus Estimate for the current year’s earnings has moved up 4% in the past 60 days.
Valmont Industries has a trailing four-quarter earnings surprise of 13.7%, on average. VMI’s shares have gained 14% in the past year.