Grainger price target raised to $1,100 from $900 at Loop Capital

Loop Capital raised the firm’s price target on Grainger (GWW) to $1,100 from $900 but keeps a Hold rating on the shares. The company has done an admirable job of driving outgrowth vs. the market aided by its Endless Assortment business and has also been “extremely successful” at driving margin gains within the High Touch business over the past several years increasing, U.S. gross margin by +370bp from 2020 to 2023, the analyst tells investors in a research note. Loop adds however that the next 50bp of margin improvement could be substantially more difficult than the last 50bp given cooling inflation, a more modest availability premium normal lead times, prior harvest of low-hanging fruit from digital investment and increasing customer push-back on pricing.