MeritValue

W.W. GRAINGER, INC.

GWWdata completeness 100%19 fiscal years on file
The thesis, from the filings

W.W. GRAINGER, INC. earns about 27% on invested capital, far above its ~9% cost of capital, and has bought back 8% of its shares over 5 years — the marks of a durable business run for its owners. The estimate methods put fair value between $368.31 and $1,752.54 a share.Whether it’s worth owning at today’s price is the last question — and yours to answer, below.

i. The business — what you’d actually own
FigureFY 2021FY 2022FY 2023FY 2024FY 2025
Revenue$13B1$15.2B2$16.5B3$17.2B3$17.9B3
Net income$1.04B4$1.55B5$1.83B6$1.91B6$1.71B6
Operating cash flow$937M7$1.33B8$2.03B9$2.11B9$2.02B9
Capital expenditure$255M10$256M11$445M12$541M12$684M12
Free cash flow (derived)$682M7$1.08B8$1.59B9$1.57B9$1.33B9
Total debt$2.36B13$2.32B14$4.6B15$5.56B16$4.98B16
Cash & equivalents$241M17$325M18$660M19$1.04B20$585M20
Diluted shares52.2M51.1M50.1M49.0M48.0M

Superscripts are receipts. Each links to the SEC filing the number came from (full list at the bottom).

ii. Your slice — ownership made literal
If you owned
shares
Net assets behind them
$778.33
your share of equity
Profit it earned you last year
$355.42
Free cash flow it threw off
$277.29
Debt you’d be carrying
$1,036.67

10 shares is a claim on $778.33 of net worth that earned you $355.42 and generated $277.29 of cash last year, against $1,036.67 of debt.

iii. Is this a good business?
Moat signal · return on invested capital
27% avg · 5y
FY21 26%FY22 35%FY23 26%FY24 24%FY25 22%

It earned about 27% on invested capital, year after year, against a ~9% cost of capital — the footprint of real pricing power. Competition usually drags returns like this back down; here it hasn't.

seeing a moat in the numbers →
Management signal · capital allocation
−8% shares · 5y

Share count is down 8% over 5 years — management has been buying back stock, quietly handing owners a bigger slice. Total debt has risen 111% over the same window.

reading capital allocation →

Signals, not verdicts — read from the filings above. Numbers don’t prove a moat; they show its footprint. You decide.

iv. What it’s worth — engine v0.1.0

The 3 estimate methods that apply put fair value between $368.31 and $1,752.54 a share. They rest on different assumptions, so where they diverge is the story; the Graham Number is a stricter floor, not a target.

DCF · Growth Exit 10Y
$1,752.54
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears10
  • fcfGrowth19.2%
  • fcfBase$1.57B
DCF · Growth Exit 5Y
$944.15
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears5
  • fcfGrowth19.2%
  • fcfBase$1.57B
Earnings Power Value
$368.31
assumptions (8)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • normalizedEarnings$1.71B
  • growthAssumed0.0%
Graham Number
$248.99
assumptions (1)
  • grahamMultiplier2250.0%

Different models answer different questions — which to trust when →

v. The price question — last, on purpose
Is today’s price fair?
See live price ↗
Type a price. The ledger answers.
Or set your own belief
FCF growth, next 5 years19.2%
Discount rate (WACC)8.93%
Terminal growth2.5%
At your growth, a share is worth $944.15
The three cases
Bear0.0%$375.85
Base19.2%$944.15
Bull20.0%$974.93

Bear/base/bull growth = 0% / filed history / history + 5pp. Type a price to see the return each case implies.

Default growth 19.2%= this company’s own filed history (median-to-median FCF CAGR, clamped 0–20%). Your adjustments are recorded anonymously. They become the “what do owners actually believe” dataset.

Sources — the receipts
  1. 10-K · period ending 2021-12-31 · accession 0000277135-24-000011 (RevenueFromContractWithCustomerExcludingAssessedTax)
  2. 10-K · period ending 2022-12-31 · accession 0000277135-25-000010 (RevenueFromContractWithCustomerExcludingAssessedTax)
  3. 10-K · period ending 2023-12-31 · accession 0000277135-26-000011 (RevenueFromContractWithCustomerExcludingAssessedTax)
  4. 10-K · period ending 2021-12-31 · accession 0000277135-24-000011 (NetIncomeLoss)
  5. 10-K · period ending 2022-12-31 · accession 0000277135-25-000010 (NetIncomeLoss)
  6. 10-K · period ending 2023-12-31 · accession 0000277135-26-000011 (NetIncomeLoss)
  7. 10-K · period ending 2021-12-31 · accession 0000277135-24-000011 (NetCashProvidedByUsedInOperatingActivities)
  8. 10-K · period ending 2022-12-31 · accession 0000277135-25-000010 (NetCashProvidedByUsedInOperatingActivities)
  9. 10-K · period ending 2023-12-31 · accession 0000277135-26-000011 (NetCashProvidedByUsedInOperatingActivities)
  10. 10-K · period ending 2021-12-31 · accession 0000277135-24-000011 (PaymentsToAcquirePropertyPlantAndEquipment)
  11. 10-K · period ending 2022-12-31 · accession 0000277135-25-000010 (PaymentsToAcquirePropertyPlantAndEquipment)
  12. 10-K · period ending 2023-12-31 · accession 0000277135-26-000011 (PaymentsToAcquirePropertyPlantAndEquipment)
  13. 10-K · period ending 2021-12-31 · accession 0000277135-23-000014 (LongTermDebtNoncurrent)
  14. 10-K · period ending 2022-12-31 · accession 0000277135-24-000011 (LongTermDebtNoncurrent)
  15. 10-K · period ending 2023-12-31 · accession 0000277135-25-000010 (LongTermDebtNoncurrent)
  16. 10-K · period ending 2024-12-31 · accession 0000277135-26-000011 (LongTermDebtNoncurrent)
  17. 10-K · period ending 2021-12-31 · accession 0000277135-23-000014 (CashAndCashEquivalentsAtCarryingValue)
  18. 10-K · period ending 2022-12-31 · accession 0000277135-24-000011 (CashAndCashEquivalentsAtCarryingValue)
  19. 10-K · period ending 2023-12-31 · accession 0000277135-25-000010 (CashAndCashEquivalentsAtCarryingValue)
  20. 10-K · period ending 2024-12-31 · accession 0000277135-26-000011 (CashAndCashEquivalentsAtCarryingValue)