Graco Inc. (GGG)
NYSEIndustrialsIndustrial - MachinerySnapshot 2026-09-04
$77.880.00%
Close 2026-09-04 · 1-day change
NYSEIndustrialsIndustrial - MachinerySnapshot 2026-09-04
Warn: Management is running behind on a stated commitment.
Graco grows revenue about 6.6% yearly, helped by M&A. The Valco Melton deal supports this growth. Profit margins remain stable near current levels. Management aims for over 10% annual revenue growth.
Revenue growth lags the 10% target with recent core product profit decline. M&A may not accelerate growth as planned. Market headwinds in industrial sector could pressure margins and sales.
The price is about 13% above our fair value near $68. Analysts expect roughly 7% revenue growth, which aligns with current estimates. Our view is cautious on hitting management's 10% growth goal.
Breaks if: acquisition fails to contribute to revenue growth or causes disruption
Pursue strategic mergers and acquisitions to expand capabilities, global reach, and market participation.
This is not a price target or investment advice.
A long-form read on the 1–3 year hold thesis. It updates when the weekly evidence changes.
This investment represents a stable long-term thesis with a focus on gradual growth. GGG is currently navigating a mixed environment, balancing its management priorities against sector challenges.
The market seems to have a low expectations gap, suggesting that GGG's valuation is considered justified compared to its peers. It is currently viewed as cheap relative to others in the industry.
Management is on track to increase revenue by over 10% annually, supported by recent growth in operating income. However, there is a moderate risk of missing earnings expectations, as the company has faced challenges in recent quarters.
The thesis hinges on the performance of sector bellwethers like GEV, PH, and TT. If these companies continue to perform well, GGG may benefit from positive sector momentum, but any guidance cuts from them could negatively impact GGG's outlook.
The most important moves since the prior daily snapshot.
Our read on the company is unchanged since the prior snapshot.
as of 2026-09-04
Review the evidence to watch, what would become a concern, and what would make it less concerning.
Not investment advice. Scores describe historical and current data; they are not forecasts of future returns. Consult a licensed advisor before making investment decisions.
Stated in 2 quarters including the recent acquisition announcement. The $447M acquisition of Valco Melton, which had $145M revenue in 2025, demonstrates active M&A execution. This supports management's stated strategy to accelerate growth through acquisitions, showing delivering progress.
“Graco completed acquisition of Valco Melton, expanding capabilities and global reach in precision adhesive application.”
“Drive growth through increased focus on strategic mergers and acquisitions to shape Graco's next 100 years.”
Breaks if: gross profit falls below $280M quarterly average
Focus on increasing customer value and loyalty through innovation and expanding aftermarket opportunities in core product lines.
Stated in 2 quarters. Operating income increased from $158.6M in 2025-Q4 to $175.1M in 2026-Q2, reflecting margin growth consistent with core product focus. The trajectory indicates delivering progress on this priority.
“Drive measurable revenue and margin growth from core product lines through increased customer value and loyalty.”
“Grow earnings by 12%+ annually on average, with about two-thirds from core business growth.”
Breaks if: YoY revenue growth falls below 6.6% in FY26
Pursue strategic mergers and acquisitions to expand capabilities, global reach, and market participation.
Stated in 2 quarters including the recent acquisition announcement. The $447M acquisition of Valco Melton, which had $145M revenue in 2025, demonstrates active M&A execution. This supports management's stated strategy to accelerate growth through acquisitions, showing delivering progress.
“Graco completed acquisition of Valco Melton, expanding capabilities and global reach in precision adhesive application.”
“Drive growth through increased focus on strategic mergers and acquisitions to shape Graco's next 100 years.”
Continue to grow revenue at a compound annual growth rate of 10% or more, driven by core business and acquisitions.
Stated as a priority in 3 recent quarters. Revenue increased from $543M in 2025-Q3 to $591M in 2026-Q2, consistent with management's targeted 10% CAGR. The trajectory shows delivering growth aligned with stated goals.
“Targeted Revenue CAGR 10%”
“For 2026, we are initiating guidance of low single-digit organic sales growth on a constant-currency basis and mid-single-digit sales growth including acquisitions.”
Focus on increasing customer value and loyalty through innovation and expanding aftermarket opportunities in core product lines.
Stated in 2 quarters. Operating income increased from $158.6M in 2025-Q4 to $175.1M in 2026-Q2, reflecting margin growth consistent with core product focus. The trajectory indicates delivering progress on this priority.
“Drive measurable revenue and margin growth from core product lines through increased customer value and loyalty.”
Overall, GGG's fundamentals appear stable, but the investment thesis is sensitive to external sector performance. Not investment advice.
“Increase revenue by 10%+ annually on average, with about two-thirds from core business and one-third from acquisitions.”
“Grow earnings by 12%+ annually on average, with about two-thirds from core business growth.”