Sherwin-Williams Company (SHW) AI Stock Analysis

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Sherwin-Williams Company

(NYSE:SHW)

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Neutral 66 (OpenAI - 4o)

Rating:66Neutral

Price Target:

$353.00

▲(8.93% Upside)

Sherwin-Williams' strong financial performance and strategic corporate actions are offset by technical weaknesses and valuation concerns. The stock's bearish trend and high P/E ratio suggest caution, while recent acquisitions and financial strategies provide long-term growth potential.

Positive Factors

Revenue Growth

Consistent revenue growth highlights the company's ability to expand its market reach and maintain strong demand for its products, supporting long-term financial stability.

Strategic Acquisitions

The acquisition enhances Sherwin-Williams' market position in Brazil, providing growth opportunities and expanding its product offerings in a key international market.

Financial Flexibility

Extending the credit agreement ensures long-term liquidity and financial stability, allowing the company to invest in growth initiatives and manage economic fluctuations effectively.

Negative Factors

High Debt Levels

High debt levels can increase financial risk and limit the company's ability to invest in new opportunities, potentially impacting long-term growth and stability.

Challenging Demand Environment

A challenging demand environment can hinder revenue growth and profitability, requiring strategic adjustments to maintain market position and financial performance.

Rising Raw Material Costs

Increasing raw material costs can pressure profit margins, necessitating effective cost management strategies to sustain profitability and competitive pricing.

Sherwin-Williams Company (SHW) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$80.28B

Dividend Yield0.98%

Average Volume (3M)1.82M

Price to Earnings (P/E)31.6

Beta (1Y)0.72

Revenue Growth0.96%

EPS Growth1.96%

CountryUS

Employees63,890

SectorBasic Materials

Sector Strength58

IndustryChemicals - Specialty

Share Statistics

EPS (TTM)3.59

Shares Outstanding247,893,510

10 Day Avg. Volume2,007,365

30 Day Avg. Volume1,820,340

Financial Highlights & Ratios

PEG Ratio2.26

Price to Book (P/B)21.32

Price to Sales (P/S)3.74

P/FCF Ratio41.46

Enterprise Value/Market Cap1.23

Enterprise Value/Revenue4.24

Enterprise Value/Gross Profit8.67

Enterprise Value/Ebitda22.41

Forecast

1Y Price Target

$398.40

Price Target Upside22.94% Upside

Rating ConsensusStrong Buy

Number of Analyst Covering11

EPS Forecast (FY)11.38

Revenue Forecast (FY)$23.54B

Sherwin-Williams Company Business Overview & Revenue Model

Company DescriptionSherwin-Williams Company (SHW) is a leading global manufacturer and distributor of paints, coatings, and related products for professional, industrial, commercial, and retail customers. Founded in 1866 and headquartered in Cleveland, Ohio, the company operates through various segments including the Americas Group, Consumer Brands Group, and Performance Coatings Group. Sherwin-Williams offers a wide range of products that include architectural paints, industrial coatings, and specialty products, catering to both residential and commercial markets.

How the Company Makes MoneySherwin-Williams generates revenue primarily through the sale of its paint and coatings products across its various business segments. The key revenue streams include retail sales through company-owned stores and independent dealers, as well as sales to professional contractors, industrial clients, and original equipment manufacturers (OEMs). The company also benefits from significant partnerships with home improvement retailers, allowing it to reach a broader customer base. Additionally, Sherwin-Williams engages in strategic acquisitions to expand its product offerings and market presence, further enhancing its earnings potential. The company's focus on innovation and sustainability in its product development also contributes to its competitive advantage and revenue growth.

Sherwin-Williams Company Key Performance Indicators (KPIs)

Any

Net Profit by Segment

Net Profit by Segment
Reveals the profitability of each business segment, highlighting which areas are driving earnings and which might need strategic adjustments.

Chart InsightsSherwin-Williams' Paint Stores Group continues to drive growth, with net profit consistently rising, reflecting strategic focus and market leadership. However, the Consumer Brands Group struggles with underperformance, impacting overall profitability. The Performance Coatings Group faces margin pressures due to increased costs and restructuring expenses. Despite these challenges, the company remains committed to above-market growth, evidenced by increased restructuring efforts and investment in the Paint Stores Group. Reduced earnings guidance highlights ongoing demand and supply chain issues, but gross margin expansion offers a positive outlook.

Data provided by:

The Fly

Sherwin-Williams Company Earnings Call Summary

Earnings Call Date:Oct 28, 2025

(Q3-2025)

% Change Since: |

Next Earnings Date:Jan 22, 2026

Earnings Call Sentiment Neutral

Sherwin-Williams reported solid financial performance in the third quarter, driven by strong sales in the Paint Stores Group and successful cost management. The acquisition of Suvinil is expected to enhance growth opportunities. However, the company faces a challenging demand environment and had to make tough decisions like temporarily suspending 401(k) matching.

Q3-2025 Updates

Positive Updates

Solid Third Quarter Results

Sherwin-Williams delivered solid third quarter results with consolidated sales increasing at the high end of the guided range. Adjusted EBITDA margin expanded by 60 basis points to 21.4%, and adjusted diluted earnings per share grew by 6.5%.

Strong Performance in Paint Stores Group

Sales in Paint Stores Group increased by a mid-single-digit percentage, with price mix up at the high end of low single digits and volume up low single digits. Segment profit grew by a mid-single-digit percentage, and segment margin increased by 40 basis points.

Successful Suvinil Acquisition

Sherwin-Williams successfully closed the Suvinil acquisition, enhancing the Consumer Brands Group Latin America portfolio and providing opportunities for profitable growth. Sales in Consumer Brands Group beat expectations.

Proactive Cost Management

Sherwin-Williams controlled costs effectively, with SG&A growth moderating to the low single-digit percentage level. Administrative SG&A was down by a low double-digit percentage.

Shareholder Returns

The company returned $864 million to shareholders through share repurchases and dividends.

Negative Updates

Challenging Demand Environment

The company continues to navigate a choppy demand environment across all end markets, with no consistent data points indicating a near-term catalyst for recovery.

Temporary Suspension of 401(k) Matching

Sherwin-Williams made the difficult decision to temporarily pause company matching contributions to the 401(k) benefit plan to preserve jobs amid prolonged demand and macroeconomic uncertainty.

Performance Coatings Group Margin Decrease

In the Performance Coatings Group, segment profit and margin decreased due to lower gross margin, primarily from unfavorable product and region sales mix and higher costs to support sales.

Company Guidance

During the third quarter of 2025, The Sherwin-Williams Company reported solid results with consolidated sales growth at the high end of their guided range. The Paint Stores Group and Consumer Brands Group exceeded expectations, while the Performance Coatings Group met them. Gross margin expanded, and SG&A growth moderated to a low single-digit percentage, in line with expectations. Adjusted EBITDA margin increased by 60 basis points to 21.4%, and adjusted diluted earnings per share grew by 6.5%. The company returned $864 million to shareholders through share repurchases and dividends. The guidance for the full year 2025 was updated, with sales expected to increase by a low single-digit percentage, and adjusted diluted net income per share projected to be between $11.25 and $11.45. Looking forward to 2026, Sherwin-Williams anticipates a challenging demand environment, with raw material costs expected to rise by low single digits and a 7% price increase in the Paint Stores Group effective January 1. The company plans to continue investing in growth initiatives while managing costs through efficiency and simplification efforts.

Sherwin-Williams Company Financial Statement Overview

Summary

Sherwin-Williams exhibits strong financial performance with consistent revenue growth and solid profitability margins. The high debt-to-equity ratio warrants attention, but the company effectively generates cash flow, supporting its financial stability.

Income Statement

Very Positive

Sherwin-Williams has demonstrated strong revenue growth with a TTM increase of 8.48%, supported by a solid gross profit margin of 48.88%. The net profit margin remains healthy at 11.05%, indicating efficient cost management. However, there is a slight decline in EBIT and EBITDA margins compared to the previous year, suggesting potential cost pressures.

Balance Sheet

Positive

The company maintains a high debt-to-equity ratio of 3.07, which could pose financial risk if not managed carefully. However, the return on equity is robust at 26.52%, reflecting strong profitability relative to shareholder equity. The equity ratio is moderate, indicating a balanced asset structure.

Cash Flow

Positive

Sherwin-Williams shows a positive free cash flow growth rate of 12.62% TTM, highlighting improved cash generation. The operating cash flow to net income ratio is 0.44, suggesting adequate cash flow relative to earnings. The free cash flow to net income ratio of 0.74 indicates efficient conversion of earnings into cash.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	23.28B	23.10B	23.05B	22.15B	19.94B	18.36B
Gross Profit	11.38B	11.20B	10.76B	9.33B	8.54B	8.68B
EBITDA	4.40B	4.49B	4.15B	3.54B	3.16B	3.44B
Net Income	2.57B	2.68B	2.39B	2.02B	1.86B	2.03B
Balance Sheet
Total Assets	26.21B	23.63B	22.95B	22.59B	20.67B	20.40B
Cash, Cash Equivalents and Short-Term Investments	241.50M	210.40M	276.80M	198.80M	165.70M	226.60M
Total Debt	13.58B	11.91B	11.81B	12.51B	11.50B	10.11B
Total Liabilities	21.78B	19.58B	19.24B	19.49B	18.23B	16.79B
Stockholders Equity	4.43B	4.05B	3.72B	3.10B	2.44B	3.61B
Cash Flow
Free Cash Flow	2.43B	2.08B	2.63B	1.28B	1.87B	3.10B
Operating Cash Flow	3.29B	3.15B	3.52B	1.92B	2.24B	3.41B
Investing Cash Flow	-2.18B	-1.20B	-1.04B	-1.61B	-476.40M	-322.40M
Financing Cash Flow	-1.11B	-2.02B	-2.42B	-282.40M	-1.83B	-3.02B

Sherwin-Williams Company Technical Analysis

Technical Analysis Sentiment

Negative

Last Price324.05

Price Trends

50DMA

334.46

Negative

100DMA

343.91

Negative

200DMA

343.52

Negative

Market Momentum

MACD

-3.54

Positive

RSI

40.92

Neutral

STOCH

21.67

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SHW, the sentiment is Negative. The current price of 324.05 is below the 20-day moving average (MA) of 331.37, below the 50-day MA of 334.46, and below the 200-day MA of 343.52, indicating a bearish trend. The MACD of -3.54 indicates Positive momentum. The RSI at 40.92 is Neutral, neither overbought nor oversold. The STOCH value of 21.67 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SHW.

Sherwin-Williams Company Risk Analysis

Sherwin-Williams Company disclosed 22 risk factors in its most recent earnings report. Sherwin-Williams Company reported the most risks in the "Macro & Political" category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Sherwin-Williams Company Peers Comparison

Overall Rating

UnderperformOutperform

Sector (61)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
AXTA	77 Outperform	$6.88B	15.48	21.75%	―	-1.83%	40.64%
RPM	71 Outperform	$13.50B	19.68	24.05%	1.96%	3.09%	12.25%
PPG	67 Neutral	$23.20B	18.32	16.31%	2.69%	-12.98%	-11.34%
ECL	66 Neutral	$75.73B	38.08	21.73%	1.01%	1.38%	-2.54%
SHW	66 Neutral	$80.28B	31.64	59.94%	0.98%	0.96%	1.96%
DD	62 Neutral	$17.38B	-22.27	-0.46%	1.74%	2.42%	-196.54%
Sector *	61 Neutral	$10.43B	7.12	-0.05%	2.87%	2.86%	-36.73%

* Basic Materials Sector Average

Performance Comparison

SHW

Sherwin-Williams Company

324.05

-19.41

-5.65%

ECL

Ecolab

264.74

26.45

11.10%

PPG

PPG Industries

102.67

-15.19

-12.89%

RPM

RPM International

105.40

-18.44

-14.89%

AXTA

Axalta Coating Systems

32.28

-2.16

-6.27%

DuPont de Nemours

41.04

9.41

29.75%

Sherwin-Williams Company Corporate Events

Private Placements and Financing

Sherwin-Williams Extends Credit Agreement to 2030

Neutral

Nov 17, 2025

On November 17, 2025, Sherwin-Williams Company entered into an Amended and Restated Credit Agreement with Citicorp USA, Inc. and other lenders, extending the maturity of $75 million in commitments from December 20, 2025, to December 20, 2030. This agreement maintains similar terms to the previous one, ensuring continuity in financial arrangements and potentially stabilizing the company’s financial operations.

Private Placements and FinancingBusiness Operations and Strategy

Sherwin-Williams Extends Credit Agreement with Citicorp

Positive

Nov 5, 2025

On November 5, 2025, Sherwin-Williams Company amended its Credit Agreement with Citicorp USA, Inc., extending the maturity of $125 million in commitments from December 2025 to December 2030. This amendment is part of Sherwin-Williams’ financial strategy to maintain flexibility and ensure long-term liquidity, potentially impacting its financial operations and stakeholder relationships positively.

Private Placements and FinancingM&A Transactions

Sherwin-Williams Acquires BASF’s Brazilian Paints Business

Positive

Oct 1, 2025

On August 8, 2025, Sherwin-Williams Company and its subsidiary, Sherwin-Williams Luxembourg, entered into a 364-day senior unsecured delayed draw Term Loan Credit Agreement, securing $750 million and €250 million respectively, to fund a transaction. On October 1, 2025, Sherwin-Williams do Brasil Indústria e Comércio Ltda., a subsidiary of Sherwin-Williams, completed the acquisition of BASF’s Brazilian architectural paints business, Suvinil Coatings S.A., for $1.15 billion, enhancing its market position in the Brazilian paints industry.

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Dec 09, 2025