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Has Graco (GGG) Fallen Too Far for a Reasonable Value?

Simply Wall St · 2d ago

Graco has seen its share price slide in 2026, even as the business reports record sales and pursues new technology partnerships. This puts a spotlight on whether the current valuation still lines up with the cash the company can generate over time. With the stock under pressure, the real question for you is how much of Graco’s cash flow story is already reflected in today’s price.

  • The share price is down 20.1% year to date. This puts recent weakness front and center when you weigh the cash flows against the current market value.
  • Record sales and the ABB agreement around Transverse Flux Motor technology can shape expectations for future margins and the timing of cash inflows from data center cooling opportunities stretching toward 2029.
  • Prefer to judge Graco on earnings? See why Graco's 20.5x P/E tells a different valuation story.

The issue now is whether Graco’s current share price is justified by the cash flows implied by its Discounted Cash Flow (DCF) intrinsic value estimate.

If you want a comparison point for this kind of cash flow story under pressure, line Graco up against 29 high quality undervalued stocks as a reference set.

Is Graco Still Cheap on Cash Flow?

The Discounted Cash Flow (DCF) model here projects what Graco might return to shareholders through future free cash generation and then discounts it back to today. On this view, the business is treated as a steady cash producer, with latest twelve month free cash flow of about $576.1 million in $ and analyst projections that point to growing free cash flows into the early 2030s rather than a sharp boom or decline.

Those rising projections mean the DCF output sits meaningfully above the current share price of $66.07, which implies the market is assigning a cautious multiple to Graco’s cash stream. The recent report of record Q3 sales and the ABB motor technology partnership for data center cooling helps explain why the model assumes continued growth in dollars generated, even as near term guidance and margin pressure keep the traded price in check. If you want to see how much headroom that leaves on the cash flow story, compare this setup with 29 high quality undervalued stocks as a cross check with. Find out what Graco could be worth using our Discounted Cash Flow (DCF) estimate.

The Graco Narrative: What Would Justify Today's Price?

Graco’s valuation puzzle only really comes into focus when you spell out the future paths that could justify a much higher or much lower price than today. This is exactly what Simply Wall St Narratives on the Community page are built to do. Each one anchors its number to a clear view on how growth, profitability and key risks might evolve next, giving you a reference point you can return to as fresh information comes through.

One of the top community narratives on Graco: 26% undervalued

"The main factor that must go right is continued execution on disciplined M&A and integration, so acquired businesses such as COROB, Color Service, Radia and Valco Melton contribute meaningfully…"

Discover why this Narrative puts Graco at 26% undervalued.

One more angle on Graco that could change your view

Price and cash generation only tell part of the story, because the people directing Graco and how their rewards line up with your interests can strongly influence what happens next. See who runs Graco and how they are paid.