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What this page is: Delvantic's full research page for W.W. Grainger, Inc. (GWW) — AI-driven forensic equity research: mechanical valuation models (DCF, EPV, anchored-PE, scenario) plus three independent AI lenses (Quality / Value / Sentiment). Everything below is rendered server-side; you are not missing content that requires JavaScript. All scores are predictions and research opinions, not financial advice.
Our current read (analysis of 2026-10-08): Designation Low · Gem Score -20 (−100…+100 Quality+Value blend) · Quality 63 · Value -75 · Sentiment 33 (timing only, not weighted) · Composite fair value $755.11 vs $1,301.94 at analysis
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profile-header/price-overview— company profile, live quote, market capextended-analysis— the core: three AI lens reads with findings, scores, and the analyst memofuture-predictions— our forward price-band predictionsmarket-narrative/ai-findings/gpt-critique— narrative context, cross-model findings, and an adversarial critique of our own analysis (near the end of the document)- Members-only sections (render as login gates for anonymous readers):
price-history,income-trend,key-metrics,financials(statement tables),insider-trading. The analysis above is public; the raw data tables require a free account.
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any ticker resolves at delvantic.com/stock/TICKER ·
raw inputs are public-company filings and market data (via licensed data feeds);
every model, score, lens read, and prediction on this page is Delvantic's own analysis.
W.W. Grainger, Inc.
GWW NYSEW.W. Grainger, Inc. is an industrial distribution company that supplies maintenance, repair, and operating (MRO) products and related services to businesses and institutions. The company focuses on helping customers maintain facilities, equipment, and safety standards by offering a broad assortment of products such as safety gear, material handling equipment, tools, electrical supplies, and cleaning and maintenance items. Grainger operates through two primary segments: High-Touch Solutions, which provides value-added MRO solutions and inventory management support to larger and more complex customers, and Endless Assortment, which serves smaller businesses through online platforms that provide convenient access to a wide catalog of MRO products. The company serves millions of customers across industries including manufacturing, government, healthcare, and commercial services. Headquartered in Lake Forest, Illinois, W.W. Grainger, Inc. plays a significant role in the industrial supply chain by combining product breadth, logistics capabilities, and technical expertise to support day-to-day operations for organizations worldwide.
Price Overview
Price History (1 Year)
Revenue & Net Income Trend
| Period | Revenue | Net Income | Net Margin | YoY/QoQ |
|---|
Key Metrics
EPS (Diluted): 35.40
Total Equity: $4.14B
Shares: 48,000,000
Total Debt: $2.49B
Cash: $585.00M
EBITDA: $2.83B
Total Debt: $2.49B
Cash: $585.00M
Revenue: $17.94B
Revenue: $17.94B
Revenue: $17.94B
Total Equity: $4.14B
Tax Rate: 25.6%
Equity: $4.14B
Total Debt: $2.49B
Cash: $585.00M
Current Liabilities: $1.94B
Long-Term Debt: $2.36B
Total Debt: $2.49B
Total Equity: $4.14B
Shares: 48,000,000
Shares: 48,000,000
CapEx: -$684.00M
Shares: 48,000,000
Stock Price: $1,304
Net Income: $1.71B
Industry Benchmarks
Income Statement (Annual)
Last updated: Aug 11, 2026 10:39am (57d ago)| Metric | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Revenue | $13.0B | $15.2B | $16.5B | $17.2B | $17.9B |
| Cost of Revenue | $8.3B | $9.4B | $10.0B | $10.4B | $10.9B |
| Gross Profit | $4.7B | $5.8B | $6.5B | $6.8B | $7.0B |
| Operating Expenses | $3.2B | $3.6B | $3.9B | $4.1B | $4.5B |
| Operating Income | $1.5B | $2.2B | $2.6B | $2.6B | $2.5B |
| Net Income | $1.0B | $1.5B | $1.8B | $1.9B | $1.7B |
| EBITDA | $1.7B | $2.4B | $2.8B | $2.9B | $2.8B |
| EPS | $19.94 | $30.22 | $36.39 | $38.84 | $35.47 |
| EPS (Diluted) | $19.84 | $30.06 | $36.23 | $38.71 | $35.40 |
Balance Sheet (Annual)
Last updated: Aug 11, 2026 12:46pm (57d ago)| Metric | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Cash & Equivalents | $241.0M | $325.0M | $660.0M | $1.0B | $585.0M |
| Total Current Assets | $4.0B | $5.0B | $5.3B | $5.7B | $5.5B |
| Total Assets | $6.6B | $7.6B | $8.1B | $8.8B | $9.0B |
| Current Liabilities | $1.5B | $2.0B | $1.8B | $2.3B | $1.9B |
| Long-Term Debt | $2.4B | $2.3B | $2.3B | $2.3B | $2.4B |
| Total Liabilities | $4.4B | $4.9B | $4.7B | $5.1B | $4.8B |
| Total Equity | $2.2B | $2.7B | $3.4B | $3.7B | $4.1B |
| Retained Earnings | $9.5B | $10.7B | $12.2B | $13.7B | $15.0B |
Cash Flow (Annual)
Last updated: Aug 11, 2026 10:39am (57d ago)| Metric | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Operating Cash Flow | $937.0M | $1.3B | $2.0B | $2.1B | $2.0B |
| Capital Expenditure | -$255.0M | -$256.0M | -$445.0M | -$541.0M | -$684.0M |
| Free Cash Flow | $682.0M | $1.1B | $1.6B | $1.6B | $1.3B |
| Acquisitions (net) | — | — | — | — | — |
| Net Debt Issued / (Repaid) | -$8.0M | $0 | -$30.0M | $464.0M | -$415.0M |
| Dividends Paid | -$357.0M | -$370.0M | -$392.0M | -$421.0M | -$467.0M |
| Stock Buybacks | -$695.0M | -$603.0M | -$850.0M | -$1.2B | -$1.0B |
| Net Change in Cash | -$344.0M | $84.0M | $335.0M | $376.0M | -$451.0M |
Growth Trends (YoY %)
Last updated: Aug 11, 2026 10:39am (57d ago)| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Revenue Growth | +16.9% | +8.2% | +4.2% | +4.5% |
| Gross Profit Growth | +23.9% | +11.1% | +4.0% | +3.7% |
| Operating Income Growth | +43.2% | +15.8% | +2.8% | -5.4% |
| Net Income Growth | +48.3% | +18.2% | +4.4% | -10.6% |
| EBITDA Growth | +40.8% | +17.4% | +3.7% | -4.2% |
Dividend History (Last 20)
Last updated: Aug 11, 2026 12:46pm (57d ago)| Date | Dividend | Declaration | Record | Payment |
|---|---|---|---|---|
| 2026-05-11 | $2.49 | — | — | — |
| 2026-02-09 | $2.26 | — | — | — |
| 2025-11-10 | $2.26 | — | — | — |
| 2025-08-11 | $2.26 | — | — | — |
| 2025-05-12 | $2.26 | — | — | — |
| 2025-02-10 | $2.05 | — | — | — |
| 2024-11-08 | $2.05 | — | — | — |
| 2024-08-12 | $2.05 | — | — | — |
| 2024-05-10 | $2.05 | — | — | — |
| 2024-02-09 | $1.86 | — | — | — |
| 2023-11-10 | $1.86 | — | — | — |
| 2023-08-11 | $1.86 | — | — | — |
| 2023-05-05 | $1.86 | — | — | — |
| 2023-02-10 | $1.72 | — | — | — |
| 2022-11-10 | $1.72 | — | — | — |
| 2022-08-05 | $1.72 | — | — | — |
| 2022-05-06 | $1.72 | — | — | — |
| 2022-02-11 | $1.62 | — | — | — |
| 2021-11-05 | $1.62 | — | — | — |
| 2021-08-06 | $1.62 | — | — | — |
Deep Analysis
Risk : Reward — upside vs downside from this company's own quarters
Computed 2026-10-05 02:02A +1σ run of quarters pays -60%; a −1σ run costs 74%. Ratio -0.8:1 (μ 7.1%, σ 3.9% floored by sector, 16 pairs).
Older method (repeat-worst-quarter): -0.6 : 1
| Case | Growth | Margin | Fair value | vs price ($1,301.94) |
|---|---|---|---|---|
| Bull — recovery | +9% | 17.3% | $756.86 | -42% |
| Base — stabilizes | +6% | 15.0% | $603.04 | -54% |
| Bear — keeps slipping | +3% | 12.8% | $471.15 | -64% |
| Stress — last quarter repeats | +6% | 7.0% | $307.18 | -76% |
| Upside — a +1σ run of quarters (v2) | +11% | 10.9% | $526.38 | -60% |
| Stress — a −1σ run of quarters (v2) | +3% | 8.7% | $336.72 | -74% |
Narrative Economics
market-narrative step).
Claude Reading
Starting with the raw tape: quarterly revenue moved from $4.39B (Q3'24) to $5.02B (Q2'26 per the data labels) — call it ~14% cumulative over ~7 quarters, or ~7-8% annualized on the recent run, better than the 4.4% 5-yr CAGR would suggest. But net income tells a different story: $486M → $570M is only 17% over the same span, and the trajectory is lumpy (Q3'25 collapsed to $294M / 6.3% margin — that's a real anomaly nobody flagged; likely a one-time charge, but the models glossed over it). Full-year 2025 NI of $1.71B is *down* from $1.91B in 2024 despite revenue growth of 4.5%, meaning operating margin compressed from 15.4% to 13.9%. FCF fell from an implied higher base to $1.33B with capex ramping to $684M — this is a company spending to defend share, not harvesting.
On the balance sheet: $2.49B debt against $585M cash and $4.14B equity is fine but not fortress; net debt/EBITDA is roughly 0.7x. ROE of 41% and ROIC of 31% are genuinely elite and explain much of the premium — this is a capital-light compounder throwing off cash on a small equity base (partly buyback-shrunken). At $1,304, you're paying 36.8x trailing earnings and 22.3x EV/EBITDA for a business whose earnings just declined 10.6% YoY and whose 5-yr earnings CAGR is *negative 3.4%*. That's the number that should stop you cold — the synthesis is right to flag overvaluation but arguably undersells how stretched this is.
Where I partially dissent from the models: the synthesis DCF at $759 (implying 42% downside) feels too punitive for a business with 31% ROIC and a Berkshire-endorsed moat — quality distributors historically don't mean-revert to DCF fair value because reinvestment economics keep compounding book. But the market-forces "prices perfection" framing is correct: at 37x with declining earnings, you need either (a) 2025 was a trough and 2026 op margins snap back to 15%+, or (b) High-Touch Solutions inflects. The Q1-Q2 2026 data actually supports (a) — margins recovered to 11.4-11.7% and revenue accelerated — so the bear case of "mature 3-5% grower" may be underestimating the cyclical recovery. The narrative layer nails it: this is anchored, durable, low-cult — meaning the premium won't collapse on sentiment, only on missed prints. A contrarian would argue the 2025 earnings dip is exactly the setup where quality names get bought (Costco, Fastenal analogs trade at similar multiples through soft years), and the buyback-driven 41% ROE floor makes shorting suicidal.
GPT Reading
Grainger’s operating business looks excellent; the stock does not. The raw numbers show a company that has added revenue steadily from $13.0B in 2021 to $17.9B in 2025, a solid 8% annualized climb over that span, while maintaining unusually strong profitability for a distributor: gross margin held near 39%, operating margin reached 13.9% in 2025, and net margin was still 9.5%. The first half of 2026 is also healthy on the surface, with revenue up to $9.76B from $8.86B in the prior-year half, roughly 10% growth, and net income of $1.13B versus $961M, about 18% growth. Quarterly net margins in 2026 rebounded to 11.4% and 11.7%, which tells me the ugly 6.3% margin in 2025’s third quarter was likely non-recurring rather than a new earnings base. This is a high-quality industrial distributor with real scale, strong returns on capital, and a business model that is clearly more resilient than a typical cyclical name.
But the valuation is stretched far beyond what the business growth supports. At $1,303, the market cap is $61.1B on a company that produced $17.9B of revenue, $2.50B of operating income, $1.71B of net income, and $1.33B of free cash flow in 2025. That is 36.8x earnings, 22.3x EV/EBITDA, 3.5x sales, and roughly 46x trailing free cash flow. Those are software-like or luxury-quality-compounder multiples, not normal prices for a mature industrial distributor growing revenues 4%-5% over the last several years and showing negative earnings and FCF CAGR on the provided screen. Even if I annualize the strong first half of 2026 and assume around $2.2B-$2.3B in net income this year, the stock is still around 27x-28x forward earnings. For that to be attractive, you need confidence that Grainger can sustain double-digit EPS growth for years, and the historical record here is weaker than the current price implies: 2025 revenue rose 4.5% year over year, but net income fell from $1.91B to $1.71B, and operating income dropped from $2.64B to $2.50B. That is not the profile of a company that should command such a premium without debate.
The key thing that stands out to me is that the market is paying for consistency while the actual earnings line has become less consistent than the price suggests. The business has unquestionably become larger and more efficient since 2021, but 2024 to 2025 already showed margin slippage at the annual level despite higher sales, and capex of $684M against $2.02B of operating cash flow means free cash conversion is good, not extraordinary. Balance sheet risk is low enough — $2.49B debt against $585M cash and $4.14B equity is manageable, with a current ratio of 2.83 — so this is not a balance-sheet short. It is a multiple risk story. Paying 15.1x book for a distributor and less than a 1% dividend yield only makes sense if the company can keep compounding earnings at a premium rate with minimal cyclicality. The raw data instead says Grainger is a superb operator in a fundamentally mature category, and mature categories usually de-rate when valuation outruns growth by this much.
The strongest case against my view is straightforward: the recent numbers may be inflecting more positively than the annual figures capture. First-half 2026 revenue growth of about 10% and earnings growth of about 18% are materially better than the 2025 full-year picture, and ROIC above 30% and ROE above 41% indicate this is not an ordinary low-value distributor. If the 2025 third-quarter earnings dip was truly one-off, then the market may be looking through it correctly and assigning a deserved premium to a business with embedded customer relationships, strong pricing discipline, and very high incremental returns. In that case, the “too expensive” argument can stay wrong for a long time because quality keeps outrunning skepticism. I weigh that differently because even giving full credit for a 2026 rebound, the valuation already discounts a lot more than a rebound: it discounts years of continued premium growth and durable margins near peak levels. For a company whose revenue base is still tied to industrial demand and procurement cycles, that is too much faith at too high a price.
What would change my mind is evidence that Grainger is not just reverting to its normal earnings power but stepping up to a meaningfully higher one. Specifically, I would want to see 2026 revenue above $19.5B, net income above $2.2B, and free cash flow pushing past $1.8B without a further rise in valuation. Sustained quarterly net margins above 11% alongside high-single-digit or better top-line growth would support the idea that this deserves a structural premium. Short of that, a share price closer to $950-$1,050 would make far more sense for a business of this quality and growth profile. At $1,300, the operating company is impressive; the equity is priced like it’s even better than the numbers show.
Grok Reading
The numbers on Grainger tell a mature distributor story that the multiple refuses to acknowledge. Revenue has compounded at roughly 4.4% with the latest annual print at $17.94B, up from $17.17B the prior year and $13.02B in 2021—steady, unspectacular industrial growth. Yet net income fell from $1.91B in 2024 to $1.71B in 2025, earnings CAGR sits at −3.4%, and free-cash-flow CAGR is −8.4% even though absolute FCF remains solid at $1.33B on $2.02B of operating cash flow. Recent quarters show sequential revenue lift—$4.74B then $5.02B with net margins back near 11.4–11.7% after the ugly 6.3% print in Q3 2025—but that recovery does not rewrite the annual picture of earnings and cash-flow compression. At $1,304 the stock clears 36.8× earnings, 22.3× EV/EBITDA and 15.1× book while the business grows mid-single digits and pays out only a 0.7% dividend. The market is capitalizing a quality-compounder narrative; the income statement is capitalizing a mid-cycle industrial distributor.
Returns on capital remain excellent—ROE 41%, ROIC 31%, gross margin locked near 39%—and the balance sheet is clean enough (net debt modest against $2.49B gross debt and $585M cash, current ratio 2.8). That operating excellence is real and explains why institutions and quality-oriented buyers stay long. It does not, however, justify paying nearly double a normalized DCF that already embeds durable mid-single-digit growth and an 8–9% WACC. The composite fair-value work around $740–760 is directionally correct: you are paying roughly 70% above cash-flow value for the belief that High-Touch Solutions and embedded MRO pricing power will permanently re-rate the terminal multiple. When earnings and FCF are already declining year-over-year, that premium is a bet on narrative durability, not on the trajectory visible in the filings.
The strongest counter-argument is precisely those elite returns and the recent top-line momentum. A skeptic of the under-valuation call would note that $5.02B quarterly revenue, 11-plus percent net margins restored, and a business that has compounded through cycles for decades deserve a scarcity premium; ROIC above 30% with only 0.6× debt-to-equity is rare in industrials, and the moat in fragmented MRO distribution plus switching costs has historically protected pricing. They would also argue that one soft year of net income (partly mix and investment timing) should not collapse a multi-decade compounder multiple, and that FCF of $1.33B still covers the modest payout and leaves dry powder for share count reduction. I weigh those points seriously—the franchise quality is not in dispute—but they explain why the stock should trade at 18–22×, not 37×, when organic growth is 4% and earnings are shrinking. Quality does not equal infinite duration of multiple expansion once the growth engine is visibly decelerating.
I would flip if the next two reported quarters deliver sustained organic revenue growth above 7–8% with operating margins pushing through 15%, or if High-Touch/software-attached revenue is broken out at a scale and margin profile that demonstrably lifts the consolidated ROIC and growth algorithm. A clean re-acceleration of FCF above $1.6B with earnings CAGR turning positive mid-teens would also force a re-rating of the fair-value band. Absent that evidence, the $1,300 handle remains a rich price for a 4% grower whose profits just went the wrong way.
Big-3 Panel — where each AI stands
Advanced Analysis Forensic deep-dive · separate lenses
Revenue has compounded from $13.02B (2021) to $17.94B (2025), roughly 8% CAGR, with gross margin expanding from 36.2% to 39.1% and operating margin peaking at 15.6% in 2023 before easing to 13.9% in 2025. Net income likewise peaked in 2024 at $1.91B and slipped to $1.71B in 2025, and FCF eased from $1.59B to $1.33B — a real but modest deceleration, not a break. Earnings quality is high: OCF/NI 1.03x, accruals -0.8% of assets, Beneish M -2.56, Altman Z 13.34. Nothing in the mechanical checks suggests aggressive accounting.
Verify before trusting this (5)
- Whether 2025 margin compression reflects tariff/cost pass-through timing or structural competitive pressure (Amazon Business, MSC)
- Endless Assortment vs High-Touch segment margin trends in the 10-K
- Debt maturity ladder and covenant terms behind the $1.9B net debt position
- Customer/end-market concentration disclosure
- Whether buyback pace was funded by FCF or incremental leverage
The e2e synthesis pegs composite fair value at $740 and signal-adjusted at $759, implying roughly 42% downside from $1,301.94. The DCF ($427) and EPV ($406) anchor a deserved value well below price; only the anchored-PE method ($1,701) supports today's tape, and that method essentially extrapolates the current premium multiple - a circular sanity flag rather than independent confirmation. Averaging the cash-flow-based methods (~$415) with a quality uplift for a Strong business and clean earnings still lands in the $700-900 zone, materially below spot.
Verify before trusting this (5)
- 2025 full-year operating margin trajectory and whether the 170bps compression is cyclical or structural
- High-Touch Solutions segment growth and mix - is the software/services premium narrative real in the numbers
- Guidance on 2026 organic revenue growth and price/cost spread as inflation normalizes
- Buyback pace and any change in capital allocation given elevated multiple
- Any one-time items in 2025 NI/FCF decline vs underlying run-rate
The macro backdrop is mildly supportive: risk-on regime at +47, VIX at 15, S&P near highs. With a beta of 1.05, GWW takes the tape roughly at face value, but as a defensive-flavored industrial distributor with steady cash flows, it also benefits from the 'quality at reasonable price' bid that thrives in calm, non-euphoric tapes. Higher 10y yields (4.72%) and a stretched market PE (26) are a background crosswind for any high-multiple compounder, but GWW's narrative is durable enough to absorb it. The prime input is the narrative itself: steady-compounder, durable, moderate intensity, low cult. That's exactly the archetype that quietly gets rewarded in this kind of tape, not chased. The Q2 print with a sales surge, margin expansion, and a full-year guide hike is a live positive catalyst hitting the wire right now, reinforcing the bull story ('operating leverage, pricing power in fragmented MRO') and making it harder for the bear framing ('mature, low-growth, paying 25x PE') to get traction near term. Where sentiment is NOT a strong tailwind: this is a low-cult, low-intensity story, so there's no mania to ride, and the stock already trades at a premium multiple, meaning good news is largely expected. Net: a modest tailwind, not a rip.
Verify before trusting this (4)
- Whether sell-side target revisions follow the guide-up in the next 1-2 weeks (a real tell on analyst tone shift)
- Any rotation out of quality-industrials into higher-beta cyclicals that would starve GWW of the defensive bid
- VIX pushing above 20 or S&P breaking recent highs down - would flip the ambient tape less friendly
- Signs the bear framing (mature, low-growth, multiple compression risk) starts showing up in downgrades or media pieces
This lens hasn't been run for this ticker yet.
When we made this prediction on Aug 12, 2026, GWW was $1,301.94. We expect it to be $1,245.00 by Feb 2027, and we consider it great value under $950.00. This is an early model (v0.6.0) — the direction is more reliable than the exact price. Made Aug 12, 2026.
Blue is our prediction, starting the day we made it. Grey is a slower route to the same place — the same destination, taking longer. Black is the actual price, so you can see how we are doing.
Post-Report Due Diligence NOTES
Evidence for a closer look, not a verdict — no score or designation on this page has been changed by it. Items marked material are ones where a conclusion above moves to the other side of the price.
trailing_eps
flips down 25%
adjusted_pe
flips down 25%