Why Sherwin-Williams Stock Has Outperformed

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Sherwin-Williams (NYSE: SHW) manufactures paints, coatings, and related products that cater primarily to the North and South American markets. The company’s stock has risen by about 40% this year, trading at levels of around $560 currently. The growth is driven by multiple factors, including stronger than expected Q2 earnings, strong demand from North America, price increases on its products, and the expansion of its retail footprint. Moreover, the company has been focusing on cutting costs and improving productivity and it’s likely that it is also realizing synergies from its 2017 acquisition of Valspar, another paint manufacturer. Below, we take a look at the company’s financial performance over the last few years and its outlook over the next two years.

View our interactive dashboard analysis on Why Has The Sherwin-Williams Stock Outperformed This Year?

How does Sherwin-Williams’s Revenue Growth in 2018 compare with that in prior periods and what’s the forecast?

Total Revenues for Sherwin-Williams significantly increased from $15.0 Bil in 2017 to $17.5 Bil in 2018; an increase of 17.0%, driven by the full-year impact of the acquisition of paints and coating manufacturer, Valspar Corporation, which closed in June 2017.

This compares with Total Revenues growth of:

  • 1.88% in 2015 compared to 2014
  • 4.55% in 2016 compared to 2015
  • 26.4% in 2017 compared to 2016

We expect Total Revenues growth to be 3% in 2019.

How does Sherwin-Williams’s Total Expense in 2018 compare with that in prior periods and what’s the forecast?

Total Expense for Sherwin-Williams significantly increased from $13.5 Bil in 2017 to $16.2 Bil in 2018; an increase of 19.7%.

This compares with Total Expense growth of:

  • -0.821% in 2015 compared to 2014
  • 4.80% in 2016 compared to 2015
  • 31.7% in 2017 compared to 2016

We expect Total Expense growth to be 2% in 2019.

How does Sherwin-Williams’s EBT in 2018 compare with that in prior periods and what’s the forecast?

EBT for Sherwin-Williams decreased moderately by -7.44% from $1.47 Bil in 2017 to $1.36 Bil in 2018.

We expect EBT to increase by 12% to $1.5 Bil in 2019.

How do Sherwin-Williams’s Net Income and EPS in 2018 compare with that in prior periods and what’s the forecast?

For more information on  Sherwin-Williams’s Net Income and EPS, view our interactive dashboard analysis.

 

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