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W.W. Grainger, Inc. (GWW - Free Report) has reported earnings per share (EPS) of $9.61 in first-quarter 2023, beating the Zacks Consensus Estimate of $8.57. The bottom line improved 36% year over year, aided by margin improvement in the High-Touch Solutions N.A. and Endless Assortment segments, and strong operating performance.
Grainger’s quarterly revenues rose 12.2% year over year to $4,091 million. The top line surpassed the Zacks Consensus Estimate of $4,061 million.
Daily sales increased 14.5% from the prior-year quarter’s levels. The uptick was driven by a strong performance in the High-Touch Solutions N.A. and Endless Assortment segments.
Operational Update
Cost of sales increased 8.5% year over year to $2,457 million. The gross profit rose 18.1% year over year to $1,634 million. The gross margin expanded to 39.9% in the quarter compared with the prior-year period’s 37.9%.
Grainger’s operating income in the quarter was up 27.3% year over year to $680 million. The operating margin was 16.6%, a 198-basis-point expansion from the prior-year quarter.
W.W. Grainger, Inc. Price, Consensus and EPS Surprise
The company had cash and cash equivalents of $461 million at the end of the first quarter of 2023, up from $325 million at 2022-end. Cash flow from operating activities was $454 million in the first quarter of 2023 compared with $343 million in the prior-year quarter. Long-term debt was $2,278 million as of Mar 31, 2023, compared with $2,284 million as of Dec 31, 2022. Grainger returned $229 million to shareholders through dividends and share buybacks in the first quarter.
2023 Outlook
Backed by the strong first-quarter performance, Grainger expects net sales for the current year between $14.2 billion and $14.8 billion. The company raised its earnings per share guidance to $34.25-$36.75 from its previous expectation of $32-$34.50.
Price Performance
In the past year, Grainger’s shares have gained 37.5% compared with the industry’s growth of 4%.
Image Source: Zacks Investment Research
Zacks Rank and Stocks to Consider
Grainger currently carries a Zacks Rank #3 (Hold).
Worthington Industries has an average trailing four-quarter earnings surprise of 27.5%. The Zacks Consensus Estimate for WOR’s fiscal 2023 earnings is pegged at $4.93 per share. The consensus estimate for 2023 earnings has moved north by 17.7% in the past 60 days. Its shares gained 17.3% in the last year.
Manitowoc has an average trailing four-quarter earnings surprise of 38.8%. The Zacks Consensus Estimate for MTW’s 2023 earnings is pegged at 85 cents per share. The consensus estimate for 2023 earnings has moved 63.5% north in the past 60 days. MTW’s shares gained 20% in the last year.
The Zacks Consensus Estimate for OI Glass’ 2023 earnings per share is pegged at $2.59. The consensus estimate for 2023 earnings rose 0.8% in the last 60 days. OI has a trailing four-quarter average earnings surprise of 16.5%. Its shares gained 61.6% in the last year.
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Grainger (GWW) Beats Q1 Earnings Estimates, Ups '23 Guidance
W.W. Grainger, Inc. (GWW - Free Report) has reported earnings per share (EPS) of $9.61 in first-quarter 2023, beating the Zacks Consensus Estimate of $8.57. The bottom line improved 36% year over year, aided by margin improvement in the High-Touch Solutions N.A. and Endless Assortment segments, and strong operating performance.
Grainger’s quarterly revenues rose 12.2% year over year to $4,091 million. The top line surpassed the Zacks Consensus Estimate of $4,061 million.
Daily sales increased 14.5% from the prior-year quarter’s levels. The uptick was driven by a strong performance in the High-Touch Solutions N.A. and Endless Assortment segments.
Operational Update
Cost of sales increased 8.5% year over year to $2,457 million. The gross profit rose 18.1% year over year to $1,634 million. The gross margin expanded to 39.9% in the quarter compared with the prior-year period’s 37.9%.
Grainger’s operating income in the quarter was up 27.3% year over year to $680 million. The operating margin was 16.6%, a 198-basis-point expansion from the prior-year quarter.
W.W. Grainger, Inc. Price, Consensus and EPS Surprise
W.W. Grainger, Inc. price-consensus-eps-surprise-chart | W.W. Grainger, Inc. Quote
Financial Position
The company had cash and cash equivalents of $461 million at the end of the first quarter of 2023, up from $325 million at 2022-end. Cash flow from operating activities was $454 million in the first quarter of 2023 compared with $343 million in the prior-year quarter. Long-term debt was $2,278 million as of Mar 31, 2023, compared with $2,284 million as of Dec 31, 2022. Grainger returned $229 million to shareholders through dividends and share buybacks in the first quarter.
2023 Outlook
Backed by the strong first-quarter performance, Grainger expects net sales for the current year between $14.2 billion and $14.8 billion. The company raised its earnings per share guidance to $34.25-$36.75 from its previous expectation of $32-$34.50.
Price Performance
In the past year, Grainger’s shares have gained 37.5% compared with the industry’s growth of 4%.
Image Source: Zacks Investment Research
Zacks Rank and Stocks to Consider
Grainger currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks from the Industrial Products sector are Worthington Industries, Inc. (WOR - Free Report) , The Manitowoc Company, Inc. (MTW - Free Report) , and OI Glass Inc. (OI - Free Report) . WOR and MTW flaunt a Zacks Rank #1 (Strong Buy) at present, and OI has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Worthington Industries has an average trailing four-quarter earnings surprise of 27.5%. The Zacks Consensus Estimate for WOR’s fiscal 2023 earnings is pegged at $4.93 per share. The consensus estimate for 2023 earnings has moved north by 17.7% in the past 60 days. Its shares gained 17.3% in the last year.
Manitowoc has an average trailing four-quarter earnings surprise of 38.8%. The Zacks Consensus Estimate for MTW’s 2023 earnings is pegged at 85 cents per share. The consensus estimate for 2023 earnings has moved 63.5% north in the past 60 days. MTW’s shares gained 20% in the last year.
The Zacks Consensus Estimate for OI Glass’ 2023 earnings per share is pegged at $2.59. The consensus estimate for 2023 earnings rose 0.8% in the last 60 days. OI has a trailing four-quarter average earnings surprise of 16.5%. Its shares gained 61.6% in the last year.