What Was Stanley Black & Decker Telling You Before Its Stock Ran?

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Stanley Black & Decker (SWK) shares returned 50.3% in the twelve months to October 29, 2026. The stock was already climbing before that period, gaining 20.2% in the six months up to October 28, 2025. Over roughly the same year, the company’s sales barely moved, but the profit kept from each dollar of sales grew. When did that first show up, and could an investor have trusted it at the time?

Management Pointed To Wider Margins In October 2024

The first sign emerged on the October 29, 2024 earnings call, a full year before the twelve months measured here. For the third quarter of 2024, management said adjusted gross margin, the company’s own measure of profit after the cost of making its products, was 30.5%. That marked a 290 basis point increase versus the third quarter a year earlier. On the February 5, 2025 call, management added that it was reshaping the cost structure to be more efficient.

Then tariffs got in the way. On the April 30, 2025 call, management said price increases would be necessary in the U.S. because of the tariffs, and that the company was accelerating the repositioning of its supply chain. By the July 29, 2025 call, it put the annualized gross cost of the tariffs at about $800 million. Operating margin in the quarters filed before October 2025 fell from 8.6% in the quarter ended September 2024 to 4.9% in the quarter ended June 2025. Across all four quarters from September 2024 to June 2025, revenue was lower than a year earlier.

An investor who bought in October 2025 was relying on management’s plan, not on its results. The company had said on July 29, 2025 that it expected further tariff countermeasures in the second half of 2025 to support its gross margin. Results for the quarter ended September 27, 2025, due November 4, 2025, showed operating margin up to 10.3%.

Buying on a plan rather than on results is a bet that the plan gets delivered. For example, Tesla’s FSD has more than 1.7 million paid customers, and only half of them pay through a subscription. Read Trefis Big Story: Musk’s Massive Marketing Miss Cost $10 Trillion.

Stanley Black & Decker Earned More On Flat Sales

Over the twelve months, Stanley Black & Decker’s shares far outran the market while the company earned more on sales that barely grew. The S&P 500 returned 13.3% over the same dates. Among peers, Toro came close with a 46.2% gain, while Illinois Tool Works and Snap-on rose much less. The advance did not happen all at once, either. On November 19, 2025, the shares closed at $59.56, below where they stood on October 28.

Revenue for the four quarters ended July 4, 2026 was $15.2 billion, about the same as a year earlier. That total includes only one quarter without the Consolidated Aerospace Manufacturing business, which the company sold to Howmet Aerospace on April 6, 2026. Yet the company kept 9.2% of that revenue as operating profit, compared to 6.7% a year earlier.

Is Stanley Black & Decker’s Margin Still Widening?

In the latest quarter, yes. Stanley Black & Decker’s gross margin was 33.0% in the quarter ended July 4, 2026, against 27.0% in the same quarter a year earlier. Management said on the July 29, 2026 call that the quarter’s adjusted gross margin, its own measure, included a benefit of about 250 basis points from net tariff refunds. The company left any further refunds out of its guidance. That 33.0% is the reported figure, not the adjusted measure. On the adjusted measure, the margin rose 620 basis points from a year earlier, and about 250 of those came from the refunds.

Management expects the next gain to come from the same moves it described in 2025. The company still aims for an adjusted gross margin of 34% to 35% in the second half of 2026 from productivity and from shifting production for its U.S. tools business from China to North America. That shift represents the supply chain repositioning management spoke of on the April 30, 2025 call. Management also said a price increase appears more likely than not by 2027, because inflation in battery metals, tungsten and oil remains persistent.

The gross margin in Stanley Black & Decker’s third-quarter report, expected in November 2026, is the measure to watch.

Does This Mean You Should Act On SWK?

Our purpose is to inform you with unique data so you make the right investment decisions. That said, betting on a single stock is always risky, no matter which direction you choose.

There is a smarter approach. Since its inception, the Trefis High Quality (HQ) Portfolio has returned 105%, beating the benchmark that combines the three major indices – the S&P 500, S&P Mid-cap, and Russell 2000. And it did so without taking the concentrated risk that comes with do-it-yourself stock picking. If that is how you want to invest, the HQ Portfolio is the place to start.

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