Graco: Lack Of Organic Growth Leads To A Hold Rating

Graco has seen weak revenue per share growth recently but maintains robust margins and a healthy return on invested capital. Graco's dividend has grown for almost 25 years, and management still provides investors with solid dividend growth and a conservative payout ratio. Recent earnings highlight Q2 Non-GAAP earnings per share $0.10 above expectations, while revenue figures came up short of the consensus. My FCF valuation model indicates GGG could be trading for a discount, but the weak organic revenue growth could justify it.

Graco ( GGG ) looks to be trading for a meaningful discount at this time, while also offering investors a robust forward return potential of almost 15%. That being said, in my opinion, it's justified based on