Graco (NYSE:GGG) Posts Quarterly Earnings Results, Hits Estimates

Graco (NYSE:GGG) released its quarterly earnings results on Monday. The industrial products company reported $0.77 EPS for the quarter, hitting the consensus estimate of $0.77, FiscalAI reports. Graco had a net margin of 23.33% and a return on equity of 19.73%. The business had revenue of $593.16 million during the quarter, compared to analyst estimates of $591.99 million. During the same quarter in the prior year, the firm earned $0.64 earnings per share. The company’s quarterly revenue was up 8.1% on a year-over-year basis.

Graco Stock Up 1.1%

Shares of GGG opened at $87.73 on Wednesday. The company has a 50-day moving average price of $83.83 and a two-hundred day moving average price of $83.92. Graco has a 12 month low of $72.06 and a 12 month high of $89.67. The stock has a market cap of $14.54 billion, a price-to-earnings ratio of 28.39, a P/E/G ratio of 2.74 and a beta of 1.09.

Graco Increases Dividend

The firm also recently disclosed a quarterly dividend, which will be paid on Wednesday, February 4th. Stockholders of record on Monday, January 19th will be issued a dividend of $0.295 per share. This represents a $1.18 dividend on an annualized basis and a dividend yield of 1.3%. The ex-dividend date of this dividend is Friday, January 16th. This is a positive change from Graco’s previous quarterly dividend of $0.28. Graco’s payout ratio is 40.27%.

Institutional Investors Weigh In On Graco

Hedge funds and other institutional investors have recently added to or reduced their stakes in the stock. CIBC Bancorp USA Inc. bought a new stake in Graco during the 3rd quarter worth about $509,000. Danske Bank A S acquired a new position in shares of Graco in the 3rd quarter valued at approximately $10,083,000. Advisory Services Network LLC boosted its holdings in shares of Graco by 0.9% in the third quarter. Advisory Services Network LLC now owns 38,008 shares of the industrial products company’s stock valued at $3,229,000 after buying an additional 353 shares during the period. Morningstar Investment Management LLC acquired a new position in Graco during the 3rd quarter worth approximately $985,000. Finally, CANADA LIFE ASSURANCE Co grew its position in Graco by 47.9% in the third quarter. CANADA LIFE ASSURANCE Co now owns 537,692 shares of the industrial products company’s stock valued at $45,482,000 after purchasing an additional 174,241 shares in the last quarter. Institutional investors and hedge funds own 93.88% of the company’s stock.

Key Stories Impacting Graco

Here are the key news stories impacting Graco this week:

• Positive Sentiment: Record quarterly and annual sales; Q4 net sales rose ~8% year-over-year and full-year sales were up ~6%, driven by acquisitions and stronger regional/industrial end-market demand. Management highlighted improved operating leverage. Business Wire Release
• Positive Sentiment: Profitability expanded: operating earnings and net income both increased ~22% year-over-year in Q4, reflecting margin improvement and higher gross profit—an earnings-quality beat that supports valuation. Business Wire Release
• Positive Sentiment: EPS in line-to-slightly-better than consensus: most outlets report Q4 EPS of $0.77 (consensus $0.77) with some third-party data showing $0.79 — the bottom line improved materially versus prior year. That helped lift investor sentiment. Zacks Earnings Match
• Neutral Sentiment: Revenue/estimate nuance: aggregated revenue was roughly $593M (up 8% YoY); some data vendors flagged a slight revenue miss versus one estimate while others show it essentially in line — net effect is limited but worth watching. Quiver Quantitative
• Neutral Sentiment: Management commentary (earnings call/transcript) emphasized acquisitions, regional growth and contractor/industrial strength as the main demand drivers; no material guidance surprise reported in headlines, so near-term outlook remains tied to execution and end-market trends. Earnings Call Transcript
• Negative Sentiment: Balance-sheet/cash items and insider activity: third?party data note cash declined modestly year-over-year and total liabilities increased; a couple of insider sales were reported, which investors sometimes view unfavorably. Quiver Quantitative
• Negative Sentiment: Valuation remains elevated vs. history (P/E ~28; PEG ~2.7), so any slowdown in end markets or margin compression could pressure the stock despite the strong quarter. (Background metrics used by the market.)

Graco declared that its board has initiated a stock buyback program on Friday, December 5th that allows the company to repurchase 15,000,000 shares. This repurchase authorization allows the industrial products company to buy shares of its stock through open market purchases. Shares repurchase programs are typically a sign that the company’s leadership believes its stock is undervalued.

Analyst Ratings Changes

Several brokerages have commented on GGG. Robert W. Baird set a $89.00 price target on shares of Graco in a research report on Friday, October 24th. KeyCorp reaffirmed a “sector weight” rating on shares of Graco in a report on Tuesday. Weiss Ratings restated a “hold (c+)” rating on shares of Graco in a report on Thursday, January 22nd. Finally, Royal Bank Of Canada restated an “outperform” rating on shares of Graco in a report on Thursday, January 15th. Two equities research analysts have rated the stock with a Buy rating and three have given a Hold rating to the company’s stock. Based on data from MarketBeat.com, Graco presently has an average rating of “Hold” and an average target price of $87.00.

Graco Company Profile

Graco Inc is a leading manufacturer of fluid handling systems and components, headquartered in Minneapolis, Minnesota. Founded in 1926, the company has built a reputation for innovation in spray finishing, lubrication, and fluid management technologies. Graco’s solutions are designed to address the needs of paint and coatings applicators, general industry, and process fluids in a variety of end markets.

The company’s product portfolio includes airless and air-assisted spray equipment, pumps for oil and gas applications, industrial lubrication systems, and automated dispensing equipment.