SHERWIN-WILLIAMS CO/THE (SHW) Stock Fundamental Analysis
USA - NYSE:SHW - US8243481061 - Common Stock
328.01 USD
-1.77 (-0.54%)
325 USD
-3.01 (-0.92%)
SHW gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 82 industry peers in the Chemicals industry. While SHW belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. While showing a medium growth rate, SHW is valued expensive at the moment.
1. Profitability
1.1 Basic Checks
SHW had positive earnings in the past year.
SHW had a positive operating cash flow in the past year.
Each year in the past 5 years SHW has been profitable.
Each year in the past 5 years SHW had a positive operating cash flow.
1.2 Ratios
Looking at the Return On Assets, with a value of 9.81%, SHW belongs to the top of the industry, outperforming 96.34% of the companies in the same industry.
With an excellent Return On Equity value of 58.12%, SHW belongs to the best of the industry, outperforming 100.00% of the companies in the same industry.
SHW has a better Return On Invested Capital (13.81%) than 93.90% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for SHW is significantly above the industry average of 6.13%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 9.81% | ||
| ROE | 58.12% | ||
| ROIC | 13.81% |
ROA(3y)10.23%
ROA(5y)9.93%
ROE(3y)65.2%
ROE(5y)65.66%
ROIC(3y)15.49%
ROIC(5y)14.7%
1.3 Margins
SHW has a Profit Margin of 11.05%. This is amongst the best in the industry. SHW outperforms 90.24% of its industry peers.
In the last couple of years the Profit Margin of SHW has grown nicely.
SHW has a Operating Margin of 15.81%. This is in the better half of the industry: SHW outperforms 79.27% of its industry peers.
SHW's Operating Margin has improved in the last couple of years.
Looking at the Gross Margin, with a value of 48.88%, SHW belongs to the top of the industry, outperforming 95.12% of the companies in the same industry.
In the last couple of years the Gross Margin of SHW has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 15.81% | ||
| PM (TTM) | 11.05% | ||
| GM | 48.88% |
OM growth 3Y6.82%
OM growth 5Y3.75%
PM growth 3Y7.49%
PM growth 5Y6.16%
GM growth 3Y4.21%
GM growth 5Y1.54%
2. Health
2.1 Basic Checks
SHW has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
The number of shares outstanding for SHW has been reduced compared to 1 year ago.
The number of shares outstanding for SHW has been reduced compared to 5 years ago.
The debt/assets ratio for SHW has been reduced compared to a year ago.
2.2 Solvency
SHW has an Altman-Z score of 4.02. This indicates that SHW is financially healthy and has little risk of bankruptcy at the moment.
SHW has a better Altman-Z score (4.02) than 89.02% of its industry peers.
SHW has a debt to FCF ratio of 4.75. This is a neutral value as SHW would need 4.75 years to pay back of all of its debts.
SHW has a Debt to FCF ratio of 4.75. This is amongst the best in the industry. SHW outperforms 82.93% of its industry peers.
A Debt/Equity ratio of 2.52 is on the high side and indicates that SHW has dependencies on debt financing.
The Debt to Equity ratio of SHW (2.52) is worse than 84.15% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.52 | ||
| Debt/FCF | 4.75 | ||
| Altman-Z | 4.02 |
ROIC/WACC1.66
WACC8.3%
2.3 Liquidity
A Current Ratio of 0.82 indicates that SHW may have some problems paying its short term obligations.
Looking at the Current ratio, with a value of 0.82, SHW is doing worse than 93.90% of the companies in the same industry.
A Quick Ratio of 0.52 indicates that SHW may have some problems paying its short term obligations.
Looking at the Quick ratio, with a value of 0.52, SHW is doing worse than 91.46% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.82 | ||
| Quick Ratio | 0.52 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 2.35% over the past year.
Measured over the past years, SHW shows a quite strong growth in Earnings Per Share. The EPS has been growing by 10.02% on average per year.
Looking at the last year, SHW shows a small growth in Revenue. The Revenue has grown by 0.96% in the last year.
SHW shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 5.23% yearly.
EPS 1Y (TTM)2.35%
EPS 3Y11.65%
EPS 5Y10.02%
EPS Q2Q%6.53%
Revenue 1Y (TTM)0.96%
Revenue growth 3Y5.02%
Revenue growth 5Y5.23%
Sales Q2Q%3.18%
3.2 Future
Based on estimates for the next years, SHW will show a quite strong growth in Earnings Per Share. The EPS will grow by 8.04% on average per year.
The Revenue is expected to grow by 3.89% on average over the next years.
EPS Next Y1.35%
EPS Next 2Y6.27%
EPS Next 3Y8.46%
EPS Next 5Y8.04%
Revenue Next Year1.38%
Revenue Next 2Y3.14%
Revenue Next 3Y3.66%
Revenue Next 5Y3.89%
3.3 Evolution
The EPS growth rate is stable: in the next years the growth will be about the same than in the last years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 29.00, SHW can be considered very expensive at the moment.
The rest of the industry has a similar Price/Earnings ratio as SHW.
The average S&P500 Price/Earnings ratio is at 25.07. SHW is around the same levels.
Based on the Price/Forward Earnings ratio of 25.64, the valuation of SHW can be described as expensive.
Compared to the rest of the industry, the Price/Forward Earnings ratio of SHW indicates a slightly more expensive valuation: SHW is more expensive than 60.98% of the companies listed in the same industry.
SHW's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 34.08.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 29 | ||
| Fwd PE | 25.64 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of SHW indicates a slightly more expensive valuation: SHW is more expensive than 73.17% of the companies listed in the same industry.
The rest of the industry has a similar Price/Free Cash Flow ratio as SHW.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 33.71 | ||
| EV/EBITDA | 21.15 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
SHW has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)21.42
PEG (5Y)2.9
EPS Next 2Y6.27%
EPS Next 3Y8.46%
5. Dividend
5.1 Amount
SHW has a yearly dividend return of 0.93%, which is pretty low.
Compared to an average industry Dividend Yield of 4.00, SHW is paying slightly less dividend.
Compared to an average S&P500 Dividend Yield of 2.44, SHW's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.93% |
5.2 History
On average, the dividend of SHW grows each year by 13.53%, which is quite nice.
SHW has paid a dividend for at least 10 years, which is a reliable track record.
SHW has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)13.53%
Div Incr Years21
Div Non Decr Years21
5.3 Sustainability
SHW pays out 30.09% of its income as dividend. This is a sustainable payout ratio.
The dividend of SHW is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP30.09%
EPS Next 2Y6.27%
EPS Next 3Y8.46%
328.01
-1.77 (-0.54%)
Chartmill FA Rating
GICS SectorMaterials
GICS IndustryGroupMaterials
GICS IndustryChemicals
Earnings (Last)
Earnings (Next)
Inst Owners83.88%
Inst Owner Change-1.18%
Ins Owners0.06%
Ins Owner Change-8.26%
Market Cap81.78B
Revenue(TTM)23.28B
Net Income(TTM)2.57B
Analysts73.33
Price Target386.11 (17.71%)
Short Float %1.69%
Short Ratio1.92
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.93% |
Yearly Dividend2.86
Dividend Growth(5Y)13.53%
DP30.09%
Div Incr Years21
Div Non Decr Years21
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-4.39%
Min EPS beat(2)-12.08%
Max EPS beat(2)3.31%
EPS beat(4)3
Avg EPS beat(4)-1.29%
Min EPS beat(4)-12.08%
Max EPS beat(4)3.31%
EPS beat(8)4
Avg EPS beat(8)-1.14%
EPS beat(12)8
Avg EPS beat(12)3.29%
EPS beat(16)10
Avg EPS beat(16)2.15%
Revenue beat(2)1
Avg Revenue beat(2)0.42%
Min Revenue beat(2)-0.75%
Max Revenue beat(2)1.58%
Revenue beat(4)1
Avg Revenue beat(4)-0.83%
Min Revenue beat(4)-2.75%
Max Revenue beat(4)1.58%
Revenue beat(8)1
Avg Revenue beat(8)-1.34%
Revenue beat(12)4
Avg Revenue beat(12)-0.36%
Revenue beat(16)6
Avg Revenue beat(16)-0.3%
PT rev (1m)-0.41%
PT rev (3m)0.54%
EPS NQ rev (1m)-2.07%
EPS NQ rev (3m)-2.52%
EPS NY rev (1m)0.4%
EPS NY rev (3m)-4.29%
Revenue NQ rev (1m)2.56%
Revenue NQ rev (3m)2.42%
Revenue NY rev (1m)0.92%
Revenue NY rev (3m)0.64%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 29 | ||
| Fwd PE | 25.64 | ||
| P/S | 3.51 | ||
| P/FCF | 33.71 | ||
| P/OCF | 24.83 | ||
| P/B | 18.48 | ||
| P/tB | N/A | ||
| EV/EBITDA | 21.15 |
EPS(TTM)11.31
EY3.45%
EPS(NY)12.79
Fwd EY3.9%
FCF(TTM)9.73
FCFY2.97%
OCF(TTM)13.21
OCFY4.03%
SpS93.35
BVpS17.75
TBVpS-27.41
PEG (NY)21.42
PEG (5Y)2.9
Graham Number67.21
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 9.81% | ||
| ROE | 58.12% | ||
| ROCE | 19.65% | ||
| ROIC | 13.81% | ||
| ROICexc | 13.98% | ||
| ROICexgc | 31.32% | ||
| OM | 15.81% | ||
| PM (TTM) | 11.05% | ||
| GM | 48.88% | ||
| FCFM | 10.42% |
ROA(3y)10.23%
ROA(5y)9.93%
ROE(3y)65.2%
ROE(5y)65.66%
ROIC(3y)15.49%
ROIC(5y)14.7%
ROICexc(3y)15.7%
ROICexc(5y)14.9%
ROICexgc(3y)47.86%
ROICexgc(5y)48.91%
ROCE(3y)20.83%
ROCE(5y)19.67%
ROICexgc growth 3Y0.33%
ROICexgc growth 5Y1.49%
ROICexc growth 3Y8.3%
ROICexc growth 5Y7.54%
OM growth 3Y6.82%
OM growth 5Y3.75%
PM growth 3Y7.49%
PM growth 5Y6.16%
GM growth 3Y4.21%
GM growth 5Y1.54%
F-Score5
Asset Turnover0.89
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.52 | ||
| Debt/FCF | 4.75 | ||
| Debt/EBITDA | 2.58 | ||
| Cap/Depr | 132.93% | ||
| Cap/Sales | 3.73% | ||
| Interest Coverage | 8.6 | ||
| Cash Conversion | 76.01% | ||
| Profit Quality | 94.35% | ||
| Current Ratio | 0.82 | ||
| Quick Ratio | 0.52 | ||
| Altman-Z | 4.02 |
F-Score5
WACC8.3%
ROIC/WACC1.66
Cap/Depr(3y)141.7%
Cap/Depr(5y)108.46%
Cap/Sales(3y)3.8%
Cap/Sales(5y)2.98%
Profit Quality(3y)83.69%
Profit Quality(5y)100.89%
High Growth Momentum
Growth
EPS 1Y (TTM)2.35%
EPS 3Y11.65%
EPS 5Y10.02%
EPS Q2Q%6.53%
EPS Next Y1.35%
EPS Next 2Y6.27%
EPS Next 3Y8.46%
EPS Next 5Y8.04%
Revenue 1Y (TTM)0.96%
Revenue growth 3Y5.02%
Revenue growth 5Y5.23%
Sales Q2Q%3.18%
Revenue Next Year1.38%
Revenue Next 2Y3.14%
Revenue Next 3Y3.66%
Revenue Next 5Y3.89%
EBIT growth 1Y-1.67%
EBIT growth 3Y12.18%
EBIT growth 5Y9.18%
EBIT Next Year14.62%
EBIT Next 3Y11.07%
EBIT Next 5Y7.71%
FCF growth 1Y-0.62%
FCF growth 3Y3.62%
FCF growth 5Y0.9%
OCF growth 1Y1.52%
OCF growth 3Y12%
OCF growth 5Y6.32%
SHERWIN-WILLIAMS CO/THE / SHW FAQ
Can you provide the ChartMill fundamental rating for SHERWIN-WILLIAMS CO/THE?
ChartMill assigns a fundamental rating of 6 / 10 to SHW.
What is the valuation status for SHW stock?
ChartMill assigns a valuation rating of 2 / 10 to SHERWIN-WILLIAMS CO/THE (SHW). This can be considered as Overvalued.
Can you provide the profitability details for SHERWIN-WILLIAMS CO/THE?
SHERWIN-WILLIAMS CO/THE (SHW) has a profitability rating of 9 / 10.
What is the valuation of SHERWIN-WILLIAMS CO/THE based on its PE and PB ratios?
The Price/Earnings (PE) ratio for SHERWIN-WILLIAMS CO/THE (SHW) is 29 and the Price/Book (PB) ratio is 18.48.
What is the earnings growth outlook for SHERWIN-WILLIAMS CO/THE?
The Earnings per Share (EPS) of SHERWIN-WILLIAMS CO/THE (SHW) is expected to grow by 1.35% in the next year.