Graco stock performance and business snapshot

Graco (GGG) has drawn investor interest after recent share price moves, including a one-month return of about a 7% decline and a past three-month return of about a 14% decline, prompting closer attention to its fundamentals.

The company reports annual revenue of about US$2.25b and net income of about US$516.24m, with revenue and net income growth both in the mid single digit range, and a market value of around US$12.93b.

At a share price of US$78.68, Graco’s recent momentum has been weak, with a 7.02% 1 month share price decline and a 14.09% 3 month share price decline. Its 5 year total shareholder return of 9.09% points to a more modest long term outcome.

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With Graco trading around US$78.68 after recent share price weakness, the key question is whether the current valuation already reflects its mid single digit growth profile and scale, or whether the stock now offers a genuine opportunity before markets price in future growth.

Most Popular Narrative: 16.4% Undervalued

Graco's most followed narrative points to a fair value of about $94.13 per share compared with the last close of $78.68, framing a moderate undervaluation built on detailed earnings and cash flow work using an 8.27% discount rate.

The strategic decision to maintain a strong U.S. manufacturing footprint may give Graco an advantage over competitors who manufacture offshore, especially in light of ongoing trade tensions and tariffs, potentially improving net margins due to cost control and pricing power.

Curious what this narrative is banking on to support that higher value? The story leans heavily on steady revenue expansion, firmer margins, and a premium earnings multiple. The detailed math behind those assumptions is where things get interesting.

Result: Fair Value of $94.13 (UNDERVALUED)

However, this story can fray if contractor margins stay pressured or if tariffs and trade policies reduce revenue by a few percent and squeeze profitability.

Next Steps

The story so far paints a mixed but interesting picture, so it is worth looking under the hood yourself instead of relying on headlines. To see what the data flags as potential bright spots, check the 4 key rewards

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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.