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Should You Consider Graco Inc. (NYSE:GGG)?

Simply Wall St

As an investor, I look for investments which does not compromise one fundamental factor for another. By this I mean, I look at stocks holistically, from their financial health to their future outlook. In the case of Graco Inc. (NYSE:GGG), it is a financially-robust , dividend-paying company with a strong track record of performance. Below, I've touched on some key aspects you should know on a high level. If you're interested in understanding beyond my broad commentary, read the full report on Graco here.

Flawless balance sheet with outstanding track record and pays a dividend

Over the past year, GGG has grown its earnings by 19%, with its most recent figure exceeding its annual average over the past five years. The strong earnings growth is reflected in impressive double-digit 37% return to shareholders, which is an optimistic signal for the future. GGG is financially robust, with ample cash on hand and short-term investments to meet upcoming liabilities. This indicates that GGG has sufficient cash flows and proper cash management in place, which is a key determinant of the company’s health. GGG appears to have made good use of debt, producing operating cash levels of 1.38x total debt in the prior year. This is a strong indication that debt is reasonably met with cash generated.

NYSE:GGG Income Statement, August 12th 2019

GGG is also a dividend company, with ample net income to cover its dividend payout, which has been consistently growing over the past decade, keeping income investors happy.

NYSE:GGG Historical Dividend Yield, August 12th 2019

Next Steps:

For Graco, I've compiled three pertinent factors you should further research:

  1. Future Outlook: What are well-informed industry analysts predicting for GGG’s future growth? Take a look at our free research report of analyst consensus for GGG’s outlook.
  2. Valuation: What is GGG worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? The intrinsic value infographic in our free research report helps visualize whether GGG is currently mispriced by the market.
  3. Other Attractive Alternatives : Are there other well-rounded stocks you could be holding instead of GGG? Explore our interactive list of stocks with large potential to get an idea of what else is out there you may be missing!

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.