Buffett Brain · Research note
Score updated 26 Sept 2026 · analysis from 18 May 2026
GGG· Industrials
Graco
Graco's 21% 5-year ROIC and fortress balance sheet are textbook Buffett, only the 25x earnings multiple keeps it out of the buy zone.
Buffett fit
Strong fit
Owner
80
Durability
86
Management
67
Price
36
Score updated 26 Sept 2026 · analysis from 18 May 2026
Buffett's checklist
Each number against Buffett's bar, and where it ranks among Industrials stocks in our database.
How much profit the business makes on each dollar invested in it. Higher is better.
What is left of each sale after the cost of making the product. A high number often means pricing power.
The cash the business earns for its owners, compared with the price of the whole company.
How fast sales grew each year over the last five years.
How many years of today's profit you pay for at today's price. Lower means cheaper.
How much the company owes compared with what it owns outright. Lower is safer.
The four pillars
How the business measures up on each of Buffett's four tests.
Buying Graco wholesale gives you a business that has compounded EPS at 4.9% per year while never having a worse year than a 4.3% EPS dip, extraordinarily smooth for an industrial supplier.
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This is what Buffett calls a 'bond-like' equity: it's nearly impossible to imagine Graco not selling spray equipment to industrial customers in 2036.
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Share count down 0.5% per year, debt/equity of 0.016, and conversion above 100%, management has been a textbook steward.
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yield of 5.0% and EV/ of 19.9x are full multiples for a slow-growing industrial.
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For and against
The strongest points on each side, with the numbers behind them.
In its favor
6- 15-year average of 21.2% is exceptional for an industrial supplier
- 2Net debt/EBITDA of -0.93x, Graco runs a net cash balance sheet
- 3Interest coverage of 200x is essentially unlimited
- 4Maximum 5-year EPS decline was just 4.3%, extraordinary stability
Concerns
3- 1 of 24.8 and EV/ of 19.9x leave little
- 2 yield of 5.0% is below the 7-8% threshold for a no-brainer
- 3Revenue CAGR of 3.0% over 5 years is modest growth
Price history
$69.28-7.8%· 5-year return
Weekly closing prices. Touch or hover the line for a date.
The business
How the business works
Graco engineers fluid-handling pumps, sprayers, and dispensing systems that go into industrial finishing, construction sealants, and lubrication, the kind of mission-critical equipment where the buyer reorders for decades. A 52.3% and 26.9% show genuine , not commodity manufacturing. The 5-year of 21.2% confirms each retained dollar earns a high return, which is the single most Buffett-friendly statistic a business can produce.
What other investors would say
The same company, judged by three other documented playbooks.
Keep researching
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