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W.W. Grainger: Almost One Million Reasons to Buy

NEW YORK ( TheStreet) -- One of the largest holdings at Gunderson Capital continues to be W.W. Grainger (GWW - Get Report). Here's why:

Data from Best Stocks Now App

The Lake Forest, Ill., large-cap company distributes more than 900,000 tools, lighting, plumbing and other maintenance products through 368 branches and 15 distribution centers.

I can hardly wait until my Grainger catalog arrives in the mail every year. I especially like the plumbing-fixture pictures and accompanying descriptions. Now this is compelling reading!

As an investor, however, I really don't care how exciting the company's wordy catalog is. I care more about making money in the stock. Here are the performance numbers for the company over the years:

Data from Best Stocks Now App

As you can see, the stock has outpaced the S&P 500 by a wide margin over the last three, five and 10 years. Also note that the stock was only down 8.2% in 2008, while the market was down 38.5%.

I guess folks still need widgets for "this and that," despite a financial crisis.

When I compare the performance of Grainger against the other 3,300 stocks that I track, it earns a performance grade of "A-". Not bad for a widget distributor.

I got back into the stock a few months ago after being out of it for about one year. It does not look like I missed much as the stock has underperformed the market over the last 12 months for a change.

I got back into the stock when it broke through resistance about two months ago.

In addition to a stock that has outperformed the market over the years, I also like a healthy stock chart.

I don't like buying stocks in downtrends. I don't especially care for sideways trends and I get really nervous about extended charts that are beginning to roll over.

I like to buy good stocks like Grainger when they are breaking out. The breakouts obviously don't always follow through, but I feel that the probabilities are in my favor.
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