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The Zacks Consensus Estimate for GWW’s second-quarter revenues is pegged at $4.35 billion, indicating 4.1% growth from the year-ago reported figure.
The consensus estimate for earnings is pegged at $9.58 per share. The Zacks Consensus Estimate for GWW’s second-quarter earnings has moved down 1% in the past 60 days. The estimate indicates year-over-year growth of 3.2%.
Image Source: Zacks Investment Research
Solid Earnings Surprise History
Grainger’s earnings beat the Zacks Consensus Estimates in the trailing four quarters, the average surprise being 3.6%.
Image Source: Zacks Investment Research
What the Zacks Model Unveils
Our model predicts an earnings beat for Grainger this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. That is precisely the case here, as you can see below.
You can uncover the best stocks before they are reported with our Earnings ESP Filter.
Earnings ESP: Grainger has an Earnings ESP of +0.77%.
Zacks Rank: GWW currently carries a Zacks Rank of 3.
Factors Likely to Have Shaped Q2 Performance
Grainger has been witnessing strong growth in core and non-pandemic product sales for the past few quarters. The company’s product mix has been stabilizing as customers are returning to normal operations post-pandemic.
Also, GWW has been focusing on improving the end-to-end customer experience by making investments in its e-commerce and digital capabilities, and executing improvement initiatives within its supply chain. These factors are likely to have contributed to the company’s second-quarter performance. We expect organic daily sales growth of 5% for the quarter.
The company’s High-Touch Solutions North America segment is expected to have benefited from strength in commercial, transportation and heavy manufacturing, strong revenue growth across its North America regions, and an expansion in the number of large and midsize customers. Our model projects quarterly organic daily sales to grow 5% from the year-ago quarter's reported level.
Grainger has been witnessing market-beating growth in the High-Touch Solutions segment compared with the U.S. MRO (maintenance, repair and operating) market. This outperformance can be attributed to strategic activities, such as building advantaged MRO solutions, delivering unparalleled customer services, and offering differentiated sales and services.
We expect the segment’s revenues to be $3.5 billion for the second quarter of 2024, up 4.5% from the second-quarter 2023 reported level.
GWW’s Endless Assortment segment is likely to have benefited from robust customer acquisition and repeat business in the quarter to be reported. Our model predicts quarterly organic daily sales to grow 3.9% from the prior-year reported level.
Customer growth at MonotaRO is expected to have positively impacted the segment’s revenues. Our model predicts the Endless Assortment segment’s revenues to be $780 million, up 3.9% from the prior-year quarter’s reported figure.
However, GWW has been witnessing elevated material and freight costs for some time. This, coupled with higher operating costs and incremental SG&A expenses due to higher technology investments, is likely to have negatively impacted its margins in the quarter under review.
Price Performance
Grainger's shares have risen 32.6% in a year against the industry’s fall of 0.6%.
Image Source: Zacks Investment Research
Other Stocks to Consider
Here are some companies with the right combination of elements to post an earnings beat in their upcoming releases.
The Zacks Consensus Estimate for EMR’s third-quarter earnings is pegged at $1.42 per share, suggesting year-over-year growth of 10.1%. It has a trailing four-quarter average surprise of 10.7%.
Donaldson Company, Inc. (DCI - Free Report) , scheduled to release its fourth-quarter fiscal 2024 soon, has an Earnings ESP of +0.81% and a Zacks Rank of 2.
The Zacks Consensus Estimate for Donaldson’s fourth-quarter fiscal 2024 earnings is pegged at 88 cents per share, indicating year-over-year growth of 12.8%. It has a trailing four-quarter average surprise of 6.2%.
Atkore Inc. (ATKR - Free Report) is scheduled to release its third-quarter fiscal 2024 results on Aug 6. It has an Earnings ESP of +0.62% and a Zacks Rank #3 at present.
The Zacks Consensus Estimate for ATKR’s third-quarter earnings is pegged at $4.03 per share, suggesting a year-over-year fall of 29.6%. It has a trailing four-quarter average surprise of 15.4%.
Image: Bigstock
Will Solid Organic Sales Aid Grainger's (GWW) Q2 Results?
W.W. Grainger, Inc. (GWW - Free Report) is scheduled to report second-quarter 2024 results on Aug 1, before the opening bell.
The Zacks Consensus Estimate for GWW’s second-quarter revenues is pegged at $4.35 billion, indicating 4.1% growth from the year-ago reported figure.
The consensus estimate for earnings is pegged at $9.58 per share. The Zacks Consensus Estimate for GWW’s second-quarter earnings has moved down 1% in the past 60 days. The estimate indicates year-over-year growth of 3.2%.
Image Source: Zacks Investment Research
Solid Earnings Surprise History
Grainger’s earnings beat the Zacks Consensus Estimates in the trailing four quarters, the average surprise being 3.6%.
Image Source: Zacks Investment Research
What the Zacks Model Unveils
Our model predicts an earnings beat for Grainger this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. That is precisely the case here, as you can see below.
You can uncover the best stocks before they are reported with our Earnings ESP Filter.
Earnings ESP: Grainger has an Earnings ESP of +0.77%.
Zacks Rank: GWW currently carries a Zacks Rank of 3.
Factors Likely to Have Shaped Q2 Performance
Grainger has been witnessing strong growth in core and non-pandemic product sales for the past few quarters. The company’s product mix has been stabilizing as customers are returning to normal operations post-pandemic.
Also, GWW has been focusing on improving the end-to-end customer experience by making investments in its e-commerce and digital capabilities, and executing improvement initiatives within its supply chain. These factors are likely to have contributed to the company’s second-quarter performance. We expect organic daily sales growth of 5% for the quarter.
The company’s High-Touch Solutions North America segment is expected to have benefited from strength in commercial, transportation and heavy manufacturing, strong revenue growth across its North America regions, and an expansion in the number of large and midsize customers. Our model projects quarterly organic daily sales to grow 5% from the year-ago quarter's reported level.
Grainger has been witnessing market-beating growth in the High-Touch Solutions segment compared with the U.S. MRO (maintenance, repair and operating) market. This outperformance can be attributed to strategic activities, such as building advantaged MRO solutions, delivering unparalleled customer services, and offering differentiated sales and services.
We expect the segment’s revenues to be $3.5 billion for the second quarter of 2024, up 4.5% from the second-quarter 2023 reported level.
GWW’s Endless Assortment segment is likely to have benefited from robust customer acquisition and repeat business in the quarter to be reported. Our model predicts quarterly organic daily sales to grow 3.9% from the prior-year reported level.
Customer growth at MonotaRO is expected to have positively impacted the segment’s revenues. Our model predicts the Endless Assortment segment’s revenues to be $780 million, up 3.9% from the prior-year quarter’s reported figure.
However, GWW has been witnessing elevated material and freight costs for some time. This, coupled with higher operating costs and incremental SG&A expenses due to higher technology investments, is likely to have negatively impacted its margins in the quarter under review.
Price Performance
Grainger's shares have risen 32.6% in a year against the industry’s fall of 0.6%.
Image Source: Zacks Investment Research
Other Stocks to Consider
Here are some companies with the right combination of elements to post an earnings beat in their upcoming releases.
Emerson Electric Co. (EMR - Free Report) is scheduled to release its third-quarter fiscal 2024 results on Aug 7. It has an Earnings ESP of +1.12% and a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for EMR’s third-quarter earnings is pegged at $1.42 per share, suggesting year-over-year growth of 10.1%. It has a trailing four-quarter average surprise of 10.7%.
Donaldson Company, Inc. (DCI - Free Report) , scheduled to release its fourth-quarter fiscal 2024 soon, has an Earnings ESP of +0.81% and a Zacks Rank of 2.
The Zacks Consensus Estimate for Donaldson’s fourth-quarter fiscal 2024 earnings is pegged at 88 cents per share, indicating year-over-year growth of 12.8%. It has a trailing four-quarter average surprise of 6.2%.
Atkore Inc. (ATKR - Free Report) is scheduled to release its third-quarter fiscal 2024 results on Aug 6. It has an Earnings ESP of +0.62% and a Zacks Rank #3 at present.
The Zacks Consensus Estimate for ATKR’s third-quarter earnings is pegged at $4.03 per share, suggesting a year-over-year fall of 29.6%. It has a trailing four-quarter average surprise of 15.4%.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.