Grainger(US:GWW) ZACKSยท2024-10-31 18:15Core Viewpoint - W.W. Grainger, Inc. reported mixed financial results for Q3 2024, with earnings per share (EPS) of $9.87, slightly below expectations, but showing a year-over-year improvement of 4.7% driven by strong segment performances [1][2]. Financial Performance - Quarterly revenues increased by 4.3% year over year to $4.39 billion, but fell short of the Zacks Consensus Estimate of $4.41 billion [2]. - Daily sales rose by 2.6% compared to the prior-year quarter, which was below the predicted growth of 2.8% [2]. Segment Performance - The High-Touch Solutions N.A. segment saw daily sales growth of 1.7% year over year, supported by broad-based gains across customer end markets [3]. - The Endless Assortment segment experienced a significant daily sales increase of 6.4%, attributed to customer acquisitions and enterprise customer growth at MonotaRO [4]. Operational Metrics - Cost of sales rose by 4.5% year over year to $2.67 billion, while gross profit increased by 3.9% to $1.7 billion, resulting in a gross margin of 39.2% [5]. - Selling, general and administrative expenses increased by 4.7% to $1.03 billion, with operating income up 2.8% to $686 million, leading to an operating margin of 15.6% [5]. Cash Flow and Balance Sheet - Cash and cash equivalents at the end of Q3 2024 were $1.45 billion, up from $0.66 billion at the end of 2023 [6]. - Cash flow from operating activities was $611 million, compared to $523 million in the prior-year quarter [6]. - Long-term debt stood at $2.28 billion as of September 30, 2024, slightly up from $2.27 billion at the end of 2023 [7]. 2024 Outlook - The company expects net sales between $17.1 billion and $17.3 billion, with sales growth anticipated at 4-4.75% [8]. - EPS is projected to be in the range of $38.65-$39.35, adjusted from previous estimates [8]. Stock Performance - Over the past year, Grainger's shares have increased by 49.4%, significantly outperforming the industry growth of 19.3% [9].