WW Grainger Second Quarter Earnings Sneak Peek

S&P 500 (NYSE:SPY) component WW Grainger (NYSE:GWW) will unveil its latest earnings on Wednesday, July 18, 2012. W.W. Grainger is a distributor of facilities maintenance products and provides services and related information used by businesses and institutions throughout North America.

WW Grainger Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average estimate of analysts is for profit of $2.63 per share, a rise of 18.5% from the company’s actual earnings for the same quarter a year ago. During the past three months, the average estimate has moved up from $2.61. Between one and three months ago, the average estimate moved up. It has dropped from $2.64 during the last month. Analysts are projecting profit to rise by 17.9% compared to last year’s $10.66.

Past Earnings Performance: The company has beaten estimates the last four quarters and is coming off a quarter where it topped forecasts by 6 cents, reporting net income of $2.57 per share against a mean estimate of profit of $2.51 per share.

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A Look Back: In the first quarter, profit rose 18.7% to $187.5 million ($2.57 a share) from $157.9 million ($2.18 a share) the year earlier, exceeding analyst expectations. Revenue rose 16.4% to $2.19 billion from $1.88 billion.

Wall St. Revenue Expectations: On average, analysts predict $2.27 billion in revenue this quarter, a rise of 13.5% from the year-ago quarter. Analysts are forecasting total revenue of $9.08 billion for the year, a rise of 12.4% from last year’s revenue of $8.08 billion.

Stock Price Performance: Between April 18, 2012 and July 13, 2012, the stock price fell $26.99 (-12.5%), from $216.75 to $189.76. The stock price saw one of its best stretches over the last year between January 3, 2012 and January 18, 2012, when shares rose for 11 straight days, increasing 8.9% (+$16.51) over that span. It saw one of its worst periods between May 29, 2012 and June 5, 2012 when shares fell for six straight days, dropping 9.4% (-$18.39) over that span.

Key Stats:

The company enters this earnings announcement with substantial revenue momentum. The company has averaged year-over-year revenue growth of 13.4% over the last four quarters.

After experiencing income increases the last three quarters, the company is hoping to keep the good news coming with this earnings announcement. Net income rose 21.1% in the third quarter of the last fiscal year and 12.3% in the fourth quarter of the last fiscal year before increasing again in the first quarter.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 2.2 last quarter. Having a ratio above 2:1 is usually considered a good indicator of a company’s liquidity and ability to meet creditor demands.

Analyst Ratings: There are mostly holds on the stock with seven of 12 analysts surveyed giving that rating.

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(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)

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