Up to date on February third, 2026 by Bob Ciura
The Dividend Aristocrats are an elite group of shares within the S&P 500 Index, which have elevated their dividends for at the least 25 consecutive years.
Yearly, we individually assessment every of the Dividend Aristocrats.
W.W. Grainger, Inc. (GWW) is a Dividend Aristocrat that has elevated its dividend for 53 years in a row.
You’ll be able to see our full checklist of all 69 Dividend Aristocrats, together with vital metrics like dividend yields and P/E ratios, by clicking on the hyperlink beneath:
Disclaimer: Certain Dividend isn’t affiliated with S&P International in any method. S&P International owns and maintains The Dividend Aristocrats Index. The knowledge on this article and downloadable spreadsheet is predicated on Certain Dividend’s personal assessment, abstract, and evaluation of the S&P 500 Dividend Aristocrats ETF (NOBL) and different sources, and is supposed to assist particular person buyers higher perceive this ETF and the index upon which it’s based mostly. Not one of the data on this article or spreadsheet is official information from S&P International. Seek the advice of S&P International for official data.
Grainger’s monetary well being is carefully tied to the broader economic system as a producer of business merchandise. The corporate has a number one place in its core markets.
And, it has deployed a number of initiatives to proceed rising earnings sooner or later.
This text will focus on Grainger’s enterprise, progress potential, and valuation.
Enterprise Overview
Grainger was based in 1927. Immediately, it’s a massive provider of upkeep, working, and restore merchandise, or “MRO” for brief.
These are merchandise like security gloves, energy instruments, ladders, take a look at devices, and motors. It additionally provides providers equivalent to stock administration.
Gross sales span a variety of each prospects and classes with out a reliance on anybody business specifically.
On February third, 2026, W.W. Grainger reported its fourth-quarter and full yr monetary outcomes. For the fourth quarter, income of $4.425 billion rose 4.5% from the identical quarter the earlier yr.
Income beat the typical analyst estimates of $4.40 billion. Adjusted earnings per share got here in at $9.44, barely beneath the consensus estimate of $9.46. Adjusted EPS fell by 2.8% year-over-year.
Working margin declined 70 foundation factors to 14.3%, which the corporate attributed to increased bills and slower progress in its North American high-touch enterprise.
For the complete yr, Grainger generated gross sales of $17.9 billion, up 4.5% from 2024. Earnings per share declined 8.6% to $35.40 for the yr.
Grainger returned $1.5 billion to shareholders by dividends and share repurchases in 2025.
Progress Prospects
Grainger lays out plenty of progress initiatives within the U.S., as a combination between “foundational” and “incremental” initiatives.
In different phrases, between what the corporate is already doing to maintain market share and what it might probably do to make additional positive aspects.
For fiscal 2026, the corporate up to date its steerage and now expects web gross sales of $18.7 billion to $19.1 billion, on natural gross sales progress of 6.5% to 9.0% for the complete yr.
Earnings-per-share are anticipated in a spread of $42.25 to $44.75. On the midpoint, EPS is anticipated to be $43.50 for 2026.
The corporate sees a number of avenues to generate future progress, a very powerful of which is that Granger operates in a extremely fragmented market.
Subsequently, the corporate sees a big and untapped market alternative to gasoline its long-term progress. One other progress catalyst for Grainger is e-commerce. It has varied e-commerce platforms, together with MonotaRO in Japan, and Zoro in the USA.
Grainger’s strategic shift of decreasing its pricing, thereby creating increased demand, and rising its revenues, appears to have labored effectively.
EPS progress will likely be pushed by rising income and a discount within the firm’s share rely.
Grainger’s income is rising, margins are bettering over time, and share repurchases will proceed to spice up earnings-per-share progress over the long run.
We’re forecasting 10% earnings-per-share progress over the subsequent 5 years.
Aggressive Benefits & Recession Efficiency
Grainger’s aggressive benefit is its huge distribution community. It has the power to supply providers equivalent to next-day floor supply, which assist it retain its aggressive place.
As well as, the enterprise’s scale permits it to cost its merchandise competitively.
Grainger isn’t lively in a high-tech business, however the firm’s providers are important for different companies. This makes Grainger’s enterprise comparatively resilient throughout recessions, permitting it to proceed elevating its dividend annually.
These aggressive benefits helped Grainger keep extremely worthwhile through the Nice Recession.
Earnings-per-share through the financial downturn are as follows:
- 2007 earnings-per-share of $4.94
- 2008 earnings-per-share of $6.09 (23% enhance)
- 2009 earnings-per-share of $5.25 (-14% decline)
- 2010 earnings-per-share of $6.81 (30% enhance)
Grainger solely had one yr of earnings decline through the Nice Recession, in between two very sturdy years. Furthermore, the corporate continued to develop after 2010.
This means a high-quality enterprise mannequin that may face up to recessions comparatively effectively.
Valuation & Anticipated Returns
Based mostly on the anticipated earnings-per-share of $43.50 for 2026 and a present share worth of ~$1,155, the inventory has a price-to-earnings ratio of 26.5x.
Whereas shares have traded fingers with a mean P/E ratio of 19 over the last decade, we’re taking a extra aggressive view, utilizing 24 occasions earnings as a good worth baseline.
Nonetheless, GWW seems to be overvalued, implying the potential for a -2.0% annual discount in shareholder returns.
Weighing this potential decline in valuation a number of in opposition to estimated EPS progress of 10% and the 0.8% dividend yield, buyers may anticipate a complete anticipated return of ~8.8% per yr for the subsequent 5 years.
Closing Ideas
W.W. Grainger is a Dividend Aristocrat managed for the long run. It has encountered difficulties at occasions, however the enterprise continues to persevere, simply because it has achieved for many years.
Furthermore, the corporate stays worthwhile in good occasions and has an distinctive file of paying and growing its dividend for 53 years.
Because of this, Grainger has joined the much more unique checklist of Dividend Kings.
Whereas the enterprise energy and potential progress are enviable, the dividend yield and the valuation are usually not notably compelling at the moment. As such, we view Grainger as a maintain proper now.
Further Studying
Moreover, the next Certain Dividend databases comprise essentially the most dependable dividend growers in our funding universe:
- The Dividend Champions: Dividend shares with 25+ years of dividend will increase, together with these that won’t qualify as Dividend Aristocrats.
- The Dividend Kings: thought-about to be the last word dividend progress shares, the Dividend Kings checklist is comprised of shares with 50+ years of consecutive dividend will increase
For those who’re searching for shares with distinctive dividend traits, contemplate the next Certain Dividend databases:
Thanks for studying this text. Please ship any suggestions, corrections, or inquiries to [email protected].
