EXHIBIT 11 GRACO INC. AND SUBSIDIARIES COMPUTATION OF NET EARNINGS PER COMMON SHARE (Unaudited) Thirteen Weeks Ended Thirty-nine Weeks Ended ----------------------------- ----------------------------- Sept 24, 1999 Sept 25, 1998 Sept 24, 1999 Sept 25, 1998 ------------- ------------- ------------- ------------- (In thousands except per share amounts) Net earnings applicable to common shareholders for basic and diluted earnings per share $ 15,043 $ 11,073 $ 44,205 $ 32,785 ------------- ------------- ------------- ------------- Weighted average shares outstanding for basic earnings per share 20,338 20,388 20,194 23,793 Dilutive effect of stock options computed using the treasury stock method and the average market price 678 591 629 638 Weighted average shares outstanding for diluted earnings per share 21,016 20,979 20,823 24,431 Basic earnings per share $ .74 $ .54 $ 2.19 $ 1.38 ------------- ------------- ------------- ------------- Diluted earnings per share $ .72 $ .53 $ 2.12 $ 1.35 ------------- ------------- ------------- -------------