W.W. Grainger, Inc. (NYSE:GWW) came out with its quarterly results last week, and we wanted to see how the business is performing and what industry forecasters think of the company following this report. W.W. Grainger reported in line with analyst predictions, delivering revenues of US$4.4b and statutory earnings per share of US$9.87, suggesting the business is executing well and in line with its plan. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.
Taking into account the latest results, the consensus forecast from W.W. Grainger's 18 analysts is for revenues of US$18.3b in 2025. This reflects a satisfactory 8.0% improvement in revenue compared to the last 12 months. Per-share earnings are expected to grow 13% to US$42.30. In the lead-up to this report, the analysts had been modelling revenues of US$18.3b and earnings per share (EPS) of US$41.98 in 2025. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.
There were no changes to revenue or earnings estimates or the price target of US$1,011, suggesting that the company has met expectations in its recent result. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. There are some variant perceptions on W.W. Grainger, with the most bullish analyst valuing it at US$1,230 and the most bearish at US$660 per share. This shows there is still a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the W.W. Grainger's past performance and to peers in the same industry. We would highlight that W.W. Grainger's revenue growth is expected to slow, with the forecast 6.3% annualised growth rate until the end of 2025 being well below the historical 9.5% p.a. growth over the last five years. Compare this to the 59 other companies in this industry with analyst coverage, which are forecast to grow their revenue at 5.4% per year. Factoring in the forecast slowdown in growth, it looks like W.W. Grainger is forecast to grow at about the same rate as the wider industry.
The Bottom Line
The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. Happily, there were no real changes to revenue forecasts, with the business still expected to grow in line with the overall industry. The consensus price target held steady at US$1,011, with the latest estimates not enough to have an impact on their price targets.
Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have forecasts for W.W. Grainger going out to 2026, and you can see them free on our platform here.
It might also be worth considering whether W.W. Grainger's debt load is appropriate, using our debt analysis tools on the Simply Wall St platform, here.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
