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Grainger (GWW) Tops Q2 Earnings, Lags Sales; Keeps View

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W.W. Grainger, Inc. (GWW - Free Report) is a leading North American distributor of material-handling equipment, safety and security supplies. The company remains focused on providing the lowest total cost maintenance, repair and operating (MRO) solution to select customer groups.

Even though Grainger remains focused on restructuring and acquisitions, the company will bear the brunt of acceleration in pricing actions. It has decided to accelerate its pricing actions this year instead of 2018, in order to gain new customers and grow with existing customers. The price acceleration is also a headwind to the company's gross margins. Further, fluctuation in oil prices and the underperforming Canada segment will dent Grainger's second-quarter 2017 results.

Let’s have a quick look on Grainger’s second-quarter release.

Estimate Trend & Surprise History

Investors should note that the earnings estimate revisions for Grainger have moved south ahead of the second quarter earnings release. The Zacks Consensus Estimate has went down 2.6% over the last 60 days and currently stands at $2.62 for the quarter.

W.W. Grainger, Inc. Price and EPS Surprise

 

W.W. Grainger, Inc. Price and EPS Surprise | W.W. Grainger, Inc. Quote

As regards earnings surprise, Grainger has outpaced the Zacks Consensus Estimate in two out of the past four quarters, resulting in an average negative surprise of 2.01%.

Earnings

Grainger posted adjusted earnings of $2.74 per share in the second-quarter of 2017. Earnings beat the Zacks Consensus Estimate of $2.62. Investors should note that these figures take out special items.

Revenue

Grainger posted revenues of $2,615 million, which marginally fell short of the Zacks Consensus Estimate for revenues of $2,622 million.

Key Stats To Note

Grainger reiterated its 2017 guidance. The company expects earnings per share for 2017 will be in the range of $10.00 to $11.30 and sales growth will also remain 1% to 4% for the full year.

Zacks Rank

Currently, Grainger has a Zacks Rank #4 (Sell), but that could change following Grainger’s earnings report which was just released.

Market Reaction

Grainger’s shares were inactive following the release. It would be interesting to see how the market reacts to the results during the trading session today.

Check back later for our full write up on this Grainger’s earnings report later!

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