Earnings Review and Free Research Report: Graco Posted Double-Digit Percentage Sales Growth Across All Segments
Research Desk Line-up: Welbilt Post Earnings Coverage
LONDON, UK / ACCESSWIRE / November 17, 2017 / Pro-Trader Daily has just published a free post-earnings coverage on Graco Inc. (NYSE: GGG), which can be viewed by registering at http://protraderdaily.com/optin/?symbol=GGG, following the Company's posting of its third quarter fiscal 2017 financial results on October 25, 2017. The leading fluid handling systems developers' revenues surged 16.08% on a y-o-y basis, and exceeded top- and bottom-line expectations. Our daily stock reports are accessible for free, and with those to look forward today you also will be signing up for a complimentary member's account at:
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Get more of our free earnings reports coverage from other constituents of the Diversified Machinery industry. Pro-TD has currently selected Welbilt, Inc. (NYSE: WBT) for due-diligence and potential coverage as the Company announced on November 06, 2017, its financial results for Q3 2017. Register for a free membership today, and be among the early birds that get access to our report on Welbilt when we publish it.
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Earnings Reviewed
Graco reported revenues of $379.81 million for the third quarter of the fiscal year 2017 compared to $327.19 million recorded at the end of Q3 FY16, resulting in an increase of 16.08% on a y-o-y basis. The Company's revenue numbers topped analysts' estimates of $355.80 million. For Q3 FY17, Graco's cost of sales amounted to $176.35 million compared to $150.59 million in Q3 FY16, an increase of 17.10% on a y-o-y basis. The gross profit was $203.47 million in Q3 FY17 compared to $176.60 million in the prior year's same quarter, reflecting a y-o-y change of 15.21%.
Excluding the provision for the reduction of income taxes and the effect of tax planning benefits, Graco's operating earnings amounted to $99.64 million in Q3 FY17 compared to $81.46 million in Q3 FY16, leading to a 22.30% change on a y-o-y basis, due to sales growth and operating expenses leverage. Earnings before income taxes amounted to $96.39 million compared to $76.62 million in Q3 FY16, resulting in a 25.81% change.
Net earnings of the Company amounted to $75.46 million in Q3 FY17 compared to $54.39 million on a y-o-y basis, resulting in a change of 38.74%.
The Company's diluted net earnings surged 36.84% to $1.30 in Q3 FY17 versus $0.95 in Q3 FY16. The adjusted diluted earnings per share (EPS) of the Company stood at $1.15 in the reported quarter compared to $0.95 in the year-ago same period, reflecting a growth of 21.05%. The Company's adjusted diluted EPS beat analysts' estimates of $1.05.
Segment Results
Graco has three major segments, namely: (i) Industrial Equipment, (ii) Process Equipment, and (iii) Contractor Equipment.
During Q3 FY17, Graco's Industrial Equipment segment's revenues totaled $178.46 million, resulting in an 18.27% increase from $150.89 million in Q3 FY16. The operating earnings for the Industrial Equipment segment amounted to $61.79 million in Q3 FY17 compared to $50.57 million in Q3 FY16, resulting in a 22.19% increase on a y-o-y basis. The positive changes in this segment were a result of the reduction in energy consumption, factory upgrades, and demand driven by material changes.
Graco's Process Equipment segment's revenues totaled $73.66 million in the reported quarter compared to $67.08 million in Q3 FY16, reflecting a growth of 9.81%. The segment's operating earnings amounted to $12.09 million in the reported quarter compared to $10.39 million in Q3 FY16, resulting in a 16.30% change on a y-o-y basis. The positive changes in this segment were a result of targeting new products and new markets, and filling product lines for a single source solution.
Graco's Contractor segment's revenues totaled $127.70 million in the reported quarter compared to $109.22 million in Q3 FY16, reporting a 16.91% change on a y-o-y basis. The segment's operating earnings amounted to $33.47 million in Q3 FY17 compared to $25.59 million in Q3 FY16, reporting a 30.78% change on a y-o-y basis. The positive changes were a result of channel expansion, pavement maintenance product line expansion, and conversions of end users from the manual application.
Balance Sheet
Graco posted cash and cash equivalents of $140.00 million in Q3 FY17 compared to $52.37 million in Q4 FY16. Accounts receivables amounted to $258.63 million in the reported quarter compared to $218.37 million in Q4 FY16. Inventories amounted to $222.88 million in the reported quarter compared to $201.61 million in Q4 FY16.
The Company's long-term debt decreased 26.39% to $225.00 million in Q3 FY17 compared to $305.69 million in Q4 FY16.
Cash Matters
Graco posted cash and cash equivalents of $140.00 million as on September 29, 2017, compared to $53.32 million as on September 23, 2016, thereby increasing $86.68 million on a y-o-y basis.
The Company reported net cash inflow from operating activities of $246.15 million in the reported quarter compared to $207.72 million in Q3 FY16, thereby reporting a 18.50% change.
In 2017, Graco made share repurchase and issuance of 1.165 million shares, accounting for a cash outflow of $47 million, while dividends payment amounted to $60 million.
Stock Performance
At the closing bell, on Thursday, November 16, 2017, Graco's stock rose 1.06%, ending the trading session at $129.67. A total volume of 297.58 thousand shares have exchanged hands, which was higher than the 3-month average volume of 229.91 thousand shares. The Company's stock price skyrocketed 15.40% in the last three months, 17.30% in the past six months, and 59.32% in the previous twelve months. Moreover, the stock soared 56.06% since the start of the year. The stock is trading at a PE ratio of 69.79 and has a dividend yield of 1.11%. The stock currently has a market cap of $7.27 billion.
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