There are no safe havens in the stock market. Every stock carries risk. But some less than others. This column features stocks that have shown one or more of the following characteristics: less volatility, better earnings, larger market caps, safe and increasing dividends. In these times of turmoil, our goal is to show readers better opportunities for investing with fewer risks.

Ocotber 11, 2010 - W. W. Grainger, Inc. (GWW-NYSE) and its subsidiaries distribute facilities maintenance and other related products and services in the United States, Canada, Japan, and Mexico. The company offers a selection of facilities maintenance and other products, and provides related services and information through local branches, catalogs, and the Internet.

It serves small and medium-sized businesses, large corporations, and governmental entities. W.W. Grainger, Inc. was founded in 1927 and is based in Lake Forest, Illinois.

This stock has been one of the steadier performers in the last 5 years, with the notable exception of late 2008 and early 2009 when the whole market cratered. Even when GWW fell from grace, it lost only about 1/3 of its value while many other stocks were down with much larger losses. Since March of 2009, GWW has only gone up and currently trades at its all-time high. What may be the best part of the story is that the future looks even brighter.

Sales and earnings are due for a strong advance this year. Total revenues are predicted to be $7.06 billion, up from $6.22 billion last year. That's an increase of 13.40%. Next year, 15 analysts estimate sales will gain 7% to $7.55 billion.

Improved sales are due to strong increases in light and heavy manufacturing domestically and abroad. When manufacturing picks up, so does demand for GWW's equipment and services. Other business sectors are also showing strength creating more orders for maintenance, repair and operating supplies. The one sector slowing: government spending.

The company's bottom line is growing due to higher volumes, better and more product mix and better efficiencies because of cost-cutting programs started years ago. One move alone, the consolidation of two operating segments in 2008, saves about $20 million a year.

The company likes to grow internally and externally. Acquisitions have always been part of GWW's expansion, in the U.S. and globally. Recently, it purchased Solus Securite Inc, a fire protection and safety supply distributor in Quebec. In Colombia it bought a Maintenance, Repair, and Overhaul (MRO) distributor. The company has over 400 branches and 14 distribution centers world-wide.

The stock pays 54 cents a quarter for $2.16 a year in dividends. That's a yield of 1.8%. Since 1985, the dividend increased annually. The next dividend payout will be in November.

More numbers: Trailing P/E is 19.9 while the Forward P/E is 16.84. Price to sales ratio is 1.31. Price to book is 4.07. Book value is $30.23. Operating margin for the last 12 months was 11.36% while the Profit margin is 7.04%. Return on equity was 22.08%, and Return on assets was 13.29%. Total cash is $388.06 million or $5.47 a share. Total debt is $508.35 million. Debt to equity ratio is .23. Current ratio is 2.66. There are 70.96 million shares outstanding with a Float of 60.40 million. Insiders own 15.17% of the stock. Institutions have 71.60% of the Float.

W. W. Grainger is one of the meat and potatoes kind of stocks. There's nothing flashy about what it makes or the services it performs. But they're essential to businesses everywhere. While other stocks may move up or down faster, for conservative investors, finding a stock that delivers solid earnings and an ever increasing dividend, GWW could look beautiful.

- Company Web site: www.grainger.com

- Ted Allrich