Graco Earnings: Everything You Must Know Now

Graco Inc. (NYSE:GGG) delivered a profit and beat Wall Street’s expectations, BUT came up short on beating the revenue expectation. The revenue miss is a negative sign to shareholders seeking high growth out of the company.

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Graco Inc. Earnings Cheat Sheet

Results: Adjusted Earnings Per Share increased 44.83% to $0.84 in the quarter versus EPS of $0.58 in the year-earlier quarter.

Revenue: Rose 14.94% to $269.1 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: Graco Inc. reported adjusted EPS income of $0.84 per share. By that measure, the company beat the mean analyst estimate of $0.73. It missed the average revenue estimate of $271.6 million.

Quoting Management: “Sales in the first quarter achieved a new record for the Company, driven by the 2012 acquisition of the Gema powder finishing business and strong double-digit growth by our Contractor business in the Americas,” said Patrick J. McHale, Graco’s President and Chief Executive Officer. “The Industrial segment began the year slower than expected, with softness in the Americas and the EMEA region. This was partially offset by Graco’s Asia Pacific Industrial business, which returned to growth. Lubrication segment sales were soft in Asia Pacific, as demand in the mining sector remained weak, somewhat offset by strength in EMEA. Gross margins Company-wide were solid, reflecting continued performance by Graco’s factories and further improvements in the Gema business, significantly contributing to the Company’s record earnings in the first quarter.”

Key Stats (on next page)…

Revenue increased 6.08% from $253.68 million in the previous quarter. EPS increased 23.53% from $0.68 in the previous quarter.

Looking Forward: Analysts have a more positive outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings has risen from a profit of $0.77 to a profit $0.78. For the current year, the average estimate has moved up from a profit of $2.86 to a profit of $2.94 over the last ninety days.

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(Company fundamentals provided by Xignite Financials. Email any earnings discrepancies to earnings [at] wallstcheatsheet.com)

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