NYSE$GWW

WW Grainger Inc · Q3 2023 earnings

Q3 2023 earnings · · Investor relations

Briefing

Reported strong results driven by strategic initiatives and narrowed full-year 2023 guidance range.

Grainger reported a strong third quarter in 2023, with sales reaching $4.2 billion, a 6.7% increase, and diluted EPS of $9.43, up 14.1% compared to the third quarter of 2022. The company also narrowed its full-year guidance for daily sales growth to between 8.5% and 9.5% and diluted EPS to between $36.00 and $36.60.

  • Sales reached $4.2 billion, up 6.7% (8.7% on a daily, constant currency basis).
  • Operating earnings increased by 10.7% to $667 million, with an operating margin of 15.9%, a 60 basis point increase.
  • Diluted EPS increased by 14.1% to $9.43.
  • Operating cash flow was $523 million, with $287 million returned to shareholders through dividends and share repurchases.

Headline financials

Total Revenue

$4.21B

Previous: $3.94B+6.7%
EPS (adj)

$9.43

Previous: $8.27+14.0%
Gross profit margin

39.3%

Previous: 38.5%+2.1%
Operating margin

15.9%

Previous: 15.3%+3.9%
Capital Expenditures

-$318M

Previous: -$208M-52.9%
Free Cash Flow

$158M

Previous: $218M-27.5%
Net Income

$476M

Previous: $426M+11.7%
Operating Income

$667M

Previous: $603M+10.6%
Gross Profit

$1.66B

Previous: $1.52B+9.0%
Cash & Equivalents

$601M

Previous: $315M+90.8%
Total Assets

$8.14B

Previous: $7.2B+13.0%
Stock-Based Comp

$18M

Previous: $11M+63.6%

Revenue & EPS history

Grainger · Revenue · Quarterly

$4.21B

Q3 2023+6.7%vs Q3 2022
Beat estimate in 8 of 15 quarters(53%)
ActualEstimate

Forward guidance

Grainger narrowed its full-year 2023 guidance, including an updated outlook for daily sales growth between 8.5% to 9.5% and diluted EPS of $36.00 to $36.60.

Tailwinds

  • Net Sales: $16.4 - $16.6 billion
  • Sales Growth: 8.0% - 9.1%
  • Daily Sales Growth: 8.5% - 9.5%
  • Gross Profit Margin: 39.3% - 39.4%
  • Operating Margin: 15.6% - 15.7%

Headwinds

  • Diluted Earnings per Share: $36.00 - $36.60
  • Operating Cash Flow: $1.8 - $1.9 billion
  • CapEx (cash basis): $450 - $525 million
  • Share Buyback: $800 - $875 million
  • Effective Tax Rate: ~24.0%

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q3 2023

Historical avgQ3 2023

+0.5%

Avg return

Earnings day

+1.1%

Avg return

5 days after

+2.8%

Avg return

30 days after

55%

40 / 73 earnings

Positive

+24.8%

Q4 2017

Best reaction

-12.4%

Q1 2017

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026+0.0%+6.9%+11.2%
Q4 2025+5.1%+9.3%+4.5%
Q3 2025+1.0%+0.6%-0.8%
Q2 2025-10.3%-7.6%-2.5%
Q1 2025+2.8%+1.7%+6.2%
Q4 2024-5.6%-7.4%-9.3%
Q3 2024+0.5%+2.1%+9.6%
Q2 2024-2.5%-2.5%+0.8%
Q1 2024-3.0%-3.9%+0.8%
Q4 2023+2.5%+2.4%+6.3%
Q3 2023+4.3%+7.7%+19.9%
Q2 2023-4.0%-4.8%-6.2%
Q1 2023+5.4%+4.4%+0.7%
Q4 2022+13.0%+13.4%+16.6%
Q3 2022+8.7%+8.6%+12.4%
Q2 2022+9.5%+8.2%+12.8%
Q1 2022+0.9%-2.4%-1.1%
Q4 2021-2.7%-3.8%-2.6%
Q3 2021+8.6%+10.1%+13.6%
Q2 2021-4.6%-4.7%-6.3%
Q1 2021+3.3%+7.1%+7.5%
Q4 2020-0.3%+1.5%+7.0%
Q3 2020-3.3%-4.2%+9.6%
Q2 2020+0.7%-1.6%+4.0%
Q1 2020-2.4%+3.6%+6.1%
Q4 2019-7.6%-5.9%-15.3%
Q3 2019-1.2%-0.9%-0.1%
Q2 2019+7.7%+4.6%-4.6%
Q1 2019-4.9%-5.3%-15.9%
Q4 2018-1.8%-0.3%+5.1%
Q3 2018-12.2%-13.1%-3.7%
Q2 2018+12.0%+12.4%+17.3%
Q1 2018+1.3%-1.8%+8.1%
Q4 2017+24.8%+19.6%+16.0%
Q3 2017+14.5%+14.0%+8.9%
Q2 2017-4.9%-4.4%-7.5%
Q1 2017-12.4%-12.5%-22.3%
Q4 2016+2.9%+2.2%+0.5%
Q3 2016-4.5%-5.0%+2.6%
Q2 2016-5.2%-4.8%+1.1%
Q1 2016-2.0%
Q4 2015-0.2%
Q3 2015-8.9%
Q2 2015+1.2%
Q1 2015-1.0%
Q4 2014-5.8%
Q3 2014-3.0%
Q2 2014-0.8%
Q1 2014+0.6%
Q4 2013-6.9%
Q3 2013+2.5%
Q2 2013+0.2%
Q1 2013+5.5%
Q4 2012+3.5%
Q3 2012-3.1%
Q2 2012+8.9%
Q1 2012+0.5%
Q4 2011-1.2%
Q3 2011+2.5%
Q2 2011-0.3%
Q1 2011+0.9%
Q4 2010+0.2%
Q3 2010+2.1%
Q2 2010+1.1%
Q1 2009+1.9%
Q1 2010+0.2%
Q4 2007-1.8%
Q4 2009-1.8%
Q3 2008+0.6%
Q3 2009+0.6%
Q4 2008+1.1%
Q2 2008+1.1%
Q2 2009+1.1%

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