Brooke Sutherland, Columnist

Amazon Panic Button Gets a Workout

Things aren't going great for the industrial distributor, but that should hardly be a surprise.

July 19, 2017 at 5:41 PM UTC

Brooke Sutherland is Bloomberg News' Boston bureau chief and writes the Industrial Strength Newsletter. She was previously a Bloomberg Opinion columnist covering deals and industrial companies and an M&A reporter for Bloomberg News.

1500487211_GettyImages-540019279 — Photographer: Fairfax Media via Getty Images

Provide news feedback or report an error

Site feedback:

Take our Survey

This article is for subscribers only.

W.W. Grainger Inc.'s results weren't stellar, but what exactly were investors expecting?

The industrial-parts distributor has lost about a quarter of its market value over the past year amid worries that its efforts to combat Amazon.com Inc. with lower prices won't work and will make it less profitable. We got further proof of that Wednesday when Grainger reported a further deterioration in its gross margin during the second quarter as well as a deceleration in sales growth. Excluding the impact of currency swings and M&A, its revenue gains were actually weaker than peers Fastenal Co. and MSC Industrial Direct Co., notes RBC analyst Deane Dray. Those companies haven't implemented massive price cuts, suggesting they may not be having their desired effect at Grainger.