In its upcoming report, W.W. Grainger (GWW) is predicted by Wall Street analysts to post quarterly earnings of $9.58 per share, reflecting an increase of 3.2% compared to the same period last year. Revenues are forecasted to be $4.35 billion, representing a year-over-year increase of 4.1%. Before a company reveals its earnings, it is vital to take into account any changes in earnings projections. These revisions play a pivotal role in predicting the possible reactions of investors toward the stock. Multiple ...

"At Grainger, doing the right thing is critical to our ability to be good stewards for our people, our customers, our shareholders and the environment," said D.G. Macpherson, Chairman and CEO. "Whether supporting fulfilling careers and strengthening our inclusive culture for our team members, helping our customers achieve their sustainability goals or partnering in our communities to build a better future, we take our responsibility seriously to make the things that matter better." Customer Sustainability S ...

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W.W. Grainger (GWW) reported $4.24 billion in revenue for the quarter ended March 2024, representing a year-over-year increase of 3.5%. EPS of $9.62 for the same period compares to $9.61 a year ago.The reported revenue represents a surprise of -0.81% over the Zacks Consensus Estimate of $4.27 billion. With the consensus EPS estimate being $9.58, the EPS surprise was +0.42%.While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and how they compare to Wall Street ...

Financial Performance - Net sales for Q1 2024 increased to $4,235 million, up 3.5% from $4,091 million in Q1 2023[11] - Gross profit for Q1 2024 was $1,668 million, compared to $1,634 million in Q1 2023, reflecting a gross margin of 39.4%[11] - Operating earnings decreased slightly to $669 million in Q1 2024 from $680 million in Q1 2023[11] - Net earnings attributable to W.W. Grainger, Inc. for Q1 2024 were $478 million, down from $488 million in Q1 2023[11] - Comprehensive earnings attributable to W.W. Grainger, Inc. for Q1 2024 were $443 million, down from $492 million in Q1 2023[14] - Diluted earnings per share for the three months ended March 31, 2024, was $9.62, slightly up from $9.61 in the same period of 2023[77] - Daily net sales for the three months ended March 31, 2024, were $66.2 million, reflecting a 3.5% increase compared to $63.9 million in the same period of 2023[72] - Daily organic constant currency net sales increased by 4.9% to $67.1 million in Q1 2024, compared to $65.2 million in Q1 2023[81] Cash Flow and Liquidity - Cash and cash equivalents increased to $804 million as of March 31, 2024, compared to $660 million at the end of 2023[17] - Net cash provided by operating activities for Q1 2024 was $661 million, significantly higher than $454 million in Q1 2023[19] - The company paid cash dividends of $105 million in Q1 2024, up from $87 million in Q1 2023[19] - Cash and cash equivalents as of March 31, 2024, were $804 million, up from $660 million as of December 31, 2023, with total available liquidity of approximately $2.1 billion[94] Assets and Liabilities - Total assets rose to $8,400 million as of March 31, 2024, up from $8,147 million at the end of 2023[17] - The Company reported a total debt of $2.284 billion as of March 31, 2024, compared to $2.300 billion as of December 31, 2023[42] - Total debt as a percentage of total capitalization was 39.4% as of March 31, 2024, down from 40.1% at the end of 2023, indicating improved financial flexibility[99] - The carrying amount of property, buildings, and equipment was $3.754 billion as of March 31, 2024, an increase from $3.718 billion as of December 31, 2023[37] - Goodwill decreased to $364 million as of March 31, 2024, from $370 million as of December 31, 2023, with no impairments recorded during the period[39] Expenses - Selling, general and administrative (SG&A) expenses increased by 5% to $999 million for the three months ended March 31, 2024, compared to $954 million in the same period of 2023[75] - Selling, general and administrative (SG&A) expenses rose to $813 million, a 4.9% increase from $775 million in Q1 2023, primarily due to higher marketing and payroll expenses[86] Market and Economic Conditions - The Company continues to monitor macroeconomic conditions, including inflation and potential recession impacts, which may affect its operations and financial results[68] - The company continues to face risks from inflation, higher product costs, and macroeconomic pressures[110] - Grainger's responses to market pressures and competitive pricing are critical to maintaining gross profit margins[110] - The Company reported no changes in internal control over financial reporting for the quarter ended March 31, 2024[115] - There have been no material changes to the risk factors previously disclosed in the 2023 Form 10-K[119] Shareholder Returns - The Company declared a quarterly dividend of $2.05 per share, payable on June 1, 2024, to shareholders of record on May 13, 2024[61] - Grainger's share repurchase program authorized the repurchase of up to 5 million shares with no expiration date, replacing the previous program from April 2021[120] - A total of 300,443 shares were purchased in the first quarter of 2024 at an average price of $950.00 per share[120] Risk Management - Forward-looking statements indicate that the company expects to face risks and uncertainties that could impact future results[108][109] - Grainger's primary market risk exposures include changes in foreign currency exchange and interest rates, with no material changes reported from the previous year[113] - The company has not experienced any major loss of customers or disruption in supply sources recently[110] - Grainger is committed to executing its environmental, social, and governance initiatives despite ongoing market challenges[110]

Q1 2024 Overall Performance - Total company sales increased by 35% [4, 62] - High-Touch Solutions N A sales increased 34% [35] - Endless Assortment sales increased 37% [8, 78] - Diluted EPS increased 01% to $962 [62, 70, 87] - Operating cash flow increased 456% to $661 million [70] Margin Analysis - Total company gross profit margin declined by 50 bps [4, 62] - High-Touch Solutions N A gross profit margin declined by 70 bps [113] - Endless Assortment gross profit margin declined by 30 bps [8, 78] - Total company operating margin declined by 80 bps [5, 62, 72] Segment Performance Details - Zoro U S daily sales increased by 51% [8, 111] - MonotaRO reported growth of 131% in local days and local currency [8] - High-Touch Solutions U S daily organic sales increased by 40% [35, 113, 121] Guidance - The company reaffirmed the full-year 2024 sales guidance of $172 billion to $177 billion [80] - The company expects full-year 2024 EPS to be between $3800 and $4050 [80]

Financial Data and Key Metrics Changes - Total company sales increased by 3.5% or 4.9% on a daily organic constant currency basis, with diluted EPS for the quarter at $9.62, up $0.01 year-over-year [58][61][41] - Operating margins decreased by 80 basis points year-over-year to 15.8%, while gross margins were down 50 basis points [61][41] - ROIC remained strong at 42.9%, and operating cash flow reached record levels, allowing the company to return $316 million to shareholders through dividends and share repurchases [41][59] Business Line Data and Key Metrics Changes - High-Touch Solutions segment sales grew by 3.4% on a reported basis or 3.8% on a daily organic constant currency basis, with gross profit at 41.8% [44][45] - Endless Assortment segment sales increased by 3.7% or 10% on a daily constant currency basis, with Zoro U.S. up 5.1% and MonotaRO achieving 13.1% growth in local currency [64][65] Market Data and Key Metrics Changes - The U.S. MRO market grew between 2% and 3%, primarily driven by price inflation, indicating that the High-Touch Solutions U.S. business achieved approximately 150 basis points of market outgrowth [46] - The company expects B2C headwinds to subside as the year progresses, with continued strong growth from B2B customers [47][15] Company Strategy and Development Direction - The company is focused on maintaining price competitiveness while managing cost increases to achieve price/cost neutrality by the end of the year [24][23] - Continued investment in demand-generating growth engines, including marketing and technology, is prioritized to drive long-term profitable share gain [61][105] Management's Comments on Operating Environment and Future Outlook - Management noted that inflation has been stickier than anticipated, with a revised outlook of 1% to 2% for inflation [23] - The company reiterated its full-year 2024 guidance, expecting daily organic constant currency sales growth between 4% and 7% and EPS ranging from $38 to $40.50 [48][42] Other Important Information - The company announced a 10% increase in its quarterly dividend, marking the 53rd consecutive year of dividend increases [59] - Foreign exchange rate pressures are expected to impact reported net sales guidance, with a potential $140 million headwind due to the yen's depreciation against the dollar [90] Q&A Session Summary Question: Update on pricing actions and gross margin implications - Management indicated that pricing actions are being implemented to correct previous misjudgments, with volume outgrowth remaining strong [69] Question: Insights on the Endless Assortment segment and B2C performance - Management confirmed that MonotaRO has effectively passed on inflation through pricing, and they anticipate positive inflection in B2C performance in the latter half of the year [71] Question: Expectations for SG&A spending and adjustments - Management expressed a commitment to maintaining investment in demand-generating initiatives, with a focus on productivity improvements [126][112] Question: Performance in utility and commercial services verticals - Management acknowledged challenges in the utilities sector but emphasized ongoing initiatives to support growth in mid-sized customers [118] Question: Impact of January weather and holiday timing - Management noted that January weather had a minor impact, while holiday timing resulted in a $10 million impact in March [120]

W.W. Grainger, Inc. (GWW) has reported earnings per share of $9.62 in first-quarter 2024, beating the Zacks Consensus Estimate of $9.58. The bottom line improved 0.1% year over year.Grainger’s quarterly revenues rose 3.5% year over year to $4.24 billion. The top line missed the Zacks Consensus Estimate of $4.27 billion. Daily sales increased 3.5% from the prior-year quarter. We predicted daily sales to increase 4.2%.The High-Touch Solutions N.A. segment’s daily sales rose 3.4% in the quarter from the first ...

Sales Performance - Q1 2024 sales reached $4.2 billion, up 3.5% YoY, or 4.9% on a daily, organic constant currency basis[3][4] - High-Touch Solutions - N.A. segment daily sales grew 3.4% YoY, while Endless Assortment segment daily sales grew 3.7% YoY (10.0% on a daily, constant currency basis)[7] - Total company reported sales growth for Q1 2024 was 3.5%, with High-Touch Solutions - N.A. at 3.4% and Endless Assortment at 3.7%[38] - Daily, organic constant currency sales growth for Q1 2024 was 4.9% for the total company, 3.8% for High-Touch Solutions - N.A., and 10.0% for Endless Assortment[38] - Foreign currency exchange positively impacted sales growth by 0.9% for the total company and 6.3% for Endless Assortment in Q1 2024[38] Earnings and Profitability - Diluted EPS for Q1 2024 was $9.62, a 0.1% increase compared to Q1 2023[3][4] - Operating margin for Q1 2024 was 15.8%, down 80 basis points YoY[4][5] - Gross profit margin for Q1 2024 was 39.4%, a 50-basis point decline YoY[8] - Net earnings for Q1 2024 were $497 million, compared to $508 million in Q1 2023[27] - Effective tax rate for Q1 2024 was 24.2%, up from 23.3% in Q1 2023 due to decreased stock compensation tax benefit[12] Cash Flow and Capital Allocation - Operating cash flow for Q1 2024 was $661 million, with free cash flow of $542 million after $119 million in capital expenditures[13] - Free cash flow (FCF) for Q1 2024 was $542 million, calculated as $661 million from operating activities minus $119 million in capital expenditures[39] - Net cash provided by operating activities increased to $661 million in Q1 2024 from $454 million in Q1 2023[27] - Capital expenditures for Q1 2024 were $119 million, up from $98 million in Q1 2023[27] - Company returned $360 million to shareholders through dividends and share repurchases in Q1 2024[4][13] - Purchases of treasury stock in Q1 2024 totaled $268 million, compared to $142 million in Q1 2023[27] - Cash dividends paid in Q1 2024 were $105 million, up from $87 million in Q1 2023[27] - Cash and cash equivalents at the end of Q1 2024 were $804 million, compared to $461 million at the end of Q1 2023[27] Guidance and Outlook - Reaffirmed FY 2024 guidance: net sales of $17.2 - $17.7 billion, diluted EPS of $38.00 - $40.50, and operating cash flow of $1.9 - $2.1 billion[14][15] - High-Touch Solutions - N.A. segment operating margin guidance for FY 2024 is 17.4% - 17.9%, while Endless Assortment segment is 7.3% - 7.8%[15]