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Valued at a market cap of almost $51.8 billion, W.W. Grainger, Inc. (GWW) is a broad-line, business-to-business distributor of maintenance, repair, and operating (MRO) products and services. The Lake Forest, Illinois-based company’s products include material-handling equipment, safety and security supplies, lighting and electrical products, power and hand tools, pumps and plumbing supplies, cleaning and maintenance supplies, and metalworking tools. It is expected to announce its fiscalQ4 earnings results before the market opens on Friday, Jan. 31.
Prior to this event, analysts expect the industrial supply company to report a profit of $9.77 per share, up 17.3% from $8.33 per share in the year-ago quarter. The company has surpassed Wall Street's earnings estimates in three of the last four quarters while missing on another occasion. Its earnings of $9.87 per share in the previous quarter fell short of the forecasted figure by 1.1%.
For fiscal 2024, analysts expect GWW to report an EPS of $38.97, up 6.3% from $36.67 in fiscal 2023.
Shares of GWW have soared 29.8% over the past 52 weeks, outpacing both the S&P 500 Index's ($SPX) 25.8% rise and the Industrial Select Sector SPDR Fund’s (XLI) 18.7% return over the same time frame.
On Oct. 31, shares of GWW marginally increased after its Q3 earnings release despite delivering weaker-than-expected Q3 earnings of $9.87 per share and revenues of $4.4 billion, which slightly missed the estimates. However, a 4.7% year-over-year increase in its bottom-line figure and a 4.3% rise in revenues from the year-ago quarter aided by growth in its High-Touch Solutions N.A. and Endless Assortment segments might have slightly bolstered investor confidence.
Wall Street analysts are cautious about W.W. Grainger’s stock, with a "Hold" rating overall. Among 16 analysts covering the stock, two recommend "Strong Buy," 13 suggest “Hold,” and one indicates a “Moderate Sell” rating.
The average analyst price target for GWW is $1,124, indicating a modest 5.8% potential upside from the current levels.
