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UBS Maintains a 'Neutral' on WW Grainger (GWW); Cutting 2012/13 After 4Q on Weaker 2011 Base

January 27, 2012 11:50 AM EST
GWW Hot Sheet
Rating Summary:
    2 Buy, 4 Hold, 1 Sell

Rating Trend: Down Down

Today's Overall Ratings:
    Up: 19 | Down: 7 | New: 26
UBS maintains a 'Neutral' on WW Grainger (NYSE: GWW) price target lowered from $210 to $206.

UBS analyst says, "While headline 4Q adj EPS of $2.13 beast the Street's $2.12 and our $2.10 results were aided by much lower tax (UBSe ~$0.19), net of weaker margins and higher AT items. Stepped up growth investments were a factor, much related to growing field sales (“TSRs”). We're encouraged by the share gains new TSRs seem to be driving, and at above average GMs, though likely at firm average EBIT margins." (UBS lowers FY12 EPS estimate from $10.65 to $10.50 and FY13 from $12.08 to $12.00)

"We expect continued strong operating performance, and view GWW shares as a core holding for quality-focused, long-term oriented investors, but on our 12- month view we think valuation is less compelling."

For an analyst ratings summary and ratings history on WW Grainger click here. For more ratings news on WW Grainger click here.

Shares of WW Grainger closed at $192.60 yesterday, with a 52 week range of $124.33-$204.62.


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