Graco (GGG) has wrapped up FY 2025 with fourth quarter revenue of US$593.2 million and basic EPS of US$0.80, alongside trailing twelve month revenue of US$2.2 billion and EPS of US$3.14 that reflect earnings growth of 7.4% over the last year. Over recent quarters, the company has seen revenue move from US$548.7 million and EPS of US$0.64 in Q4 2024 to US$593.2 million and EPS of US$0.80 in Q4 2025. Trailing twelve month EPS shifted from US$2.88 to US$3.14 as net profit margins edged to 23.3%. For investors, that backdrop of steady EPS progression and firm margins presents this result as a relatively clear indication of how durable Graco’s profitability profile looks heading into its next phase.

See our full analysis for Graco.

With the latest numbers in place, the next step is to see how this earnings run rate lines up against the widely held narratives about Graco’s growth, quality, and risk profile.

7.4% earnings growth vs 5.4% five year pace

• Over the last 12 months, earnings grew 7.4% compared with an average of 5.4% per year over five years, and trailing 12 month EPS reached US$3.14 alongside total revenue of US$2.2b.
• What stands out for a bullish view is that the recent 7.4% earnings growth and EPS of US$3.14 come with net income of US$521.8 million over the last year, which lines up with the idea of a solid industrial business but also shows some tension with slower revenue growth than the broader US market.
  • Quarterly net income moved from US$108.7 million in Q4 2024 to US$132.5 million in Q4 2025 while trailing 12 month net income rose from US$486.1 million to US$521.8 million.
  • At the same time, trailing 12 month revenue increased from US$2.1b to US$2.2b, which supports a quality earnings story even though the data notes that revenue growth is slower than the wider US market.

To see how this growth trend fits into a bigger picture of where the company might be heading, it helps to read the broader narrative investors are building around these numbers. 📊 Read the full Graco Consensus Narrative.

Margins holding at 23.3% with quarterly support

• Net profit margin for the last 12 months sits at 23.3% compared with 23.0% a year earlier, backed by quarterly net income between US$124.1 million and US$137.6 million on revenues ranging from US$528.3 million to US$593.2 million across FY 2025.
• Supporters of a bullish angle often look for stable profitability, and here the combination of a 23.3% trailing margin and Q4 2025 net income of US$132.5 million on US$593.2 million of revenue fits that view, although the step up from 23.0% to 23.3% is quite modest.
  • Across FY 2025, quarterly revenue moved from US$528.3 million in Q1 to US$593.2 million in Q4, while net income went from US$124.1 million to US$132.5 million, which keeps margins in a tight range through the year.
  • Compared with Q4 2024, when revenue was US$548.7 million and net income was US$108.7 million, the latest quarter pairs higher sales with higher profit, which supports the idea of earnings quality highlighted in the analysis data.

P/E premium and DCF gap at US$87.65 share price

• The shares trade on a trailing P/E of 27.7x, above the US Machinery industry at 27.0x and peers at 27.2x, while the current price of US$87.65 also sits above the DCF fair value of US$79.36 that appears in the data.
• Critics who focus on valuation premiums would point to the combination of a 27.7x P/E and a share price above a US$79.36 DCF fair value as reasons to be cautious, even though the same data describes earnings quality as high and notes 7.4% earnings growth over the last year.
  • The premium vs industry and peer P/E multiples is relatively small, but it is paired with a DCF gap where the market price is around US$8 above that modelled value.
  • That sits against trailing 12 month revenue of US$2.2b and net income of US$521.8 million, so anyone worried about overpaying will likely watch how those figures track against the implied expectations in the current multiple.

Next Steps

Don't just look at this quarter; the real story is in the long-term trend. We've done an in-depth analysis on Graco's growth and its valuation to see if today's price is a bargain. Add the company to your watchlist or portfolio now so you don't miss the next big move.

See What Else Is Out There

Graco pairs solid margins with a 27.7x P/E and a share price above a US$79.36 DCF fair value, which may leave valuation-focused investors uneasy.

If paying a premium here gives you pause, shift your attention to these 880 undervalued stocks based on cash flows to quickly zero in on companies priced more conservatively relative to their fundamentals.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.