SHERWIN-WILLIAMS CO/THE (SHW) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:SHW - US8243481061 - Common Stock
343.69 USD
+0.3 (+0.09%)
343.69 USD
0 (0%)
SHW gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 81 industry peers in the Chemicals industry. SHW has an excellent profitability rating, but there are some minor concerns on its financial health. SHW is valied quite expensively at the moment, while it does show a decent growth rate.
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.
SHW had positive earnings in each of the past 5 years.
Each year in the past 5 years SHW had a positive operating cash flow.
1.2 Ratios
The Return On Assets of SHW (9.81%) is better than 95.06% of its industry peers.
The Return On Equity of SHW (58.12%) is better than 100.00% of its industry peers.
SHW has a Return On Invested Capital of 13.81%. This is amongst the best in the industry. SHW outperforms 93.83% 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 6.15%.
| 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 better Profit Margin (11.05%) than 88.89% of its industry peers.
SHW's Profit Margin has improved in the last couple of years.
SHW has a better Operating Margin (15.81%) than 79.01% 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 95.06% of the companies in the same industry.
SHW's Gross Margin has improved in the last couple of years.
| 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.
Compared to 1 year ago, SHW has less shares outstanding
The number of shares outstanding for SHW has been reduced compared to 5 years ago.
Compared to 1 year ago, SHW has an improved debt to assets ratio.
2.2 Solvency
An Altman-Z score of 4.10 indicates that SHW is not in any danger for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 4.10, SHW belongs to the top of the industry, outperforming 88.89% of the companies in the same industry.
The Debt to FCF ratio of SHW is 4.75, which is a neutral value as it means it would take SHW, 4.75 years of fcf income to pay off all of its debts.
With an excellent Debt to FCF ratio value of 4.75, SHW belongs to the best of the industry, outperforming 82.72% of the companies in the same industry.
SHW has a Debt/Equity ratio of 2.52. This is a high value indicating a heavy dependency on external financing.
SHW has a worse Debt to Equity ratio (2.52) than 82.72% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.52 | ||
| Debt/FCF | 4.75 | ||
| Altman-Z | 4.1 |
ROIC/WACC1.64
WACC8.41%
2.3 Liquidity
SHW has a Current Ratio of 0.82. This is a bad value and indicates that SHW is not financially healthy enough and could expect problems in meeting its short term obligations.
The Current ratio of SHW (0.82) is worse than 93.83% of its industry peers.
SHW has a Quick Ratio of 0.82. This is a bad value and indicates that SHW is not financially healthy enough and could expect problems in meeting its short term obligations.
SHW has a Quick ratio of 0.52. This is amonst the worse of the industry: SHW underperforms 91.36% of its industry peers.
| 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.
The Earnings Per Share has been growing by 10.02% on average over the past years. This is quite good.
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.
SHW is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 3.89% yearly.
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.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
SHW is valuated quite expensively with a Price/Earnings ratio of 30.39.
SHW's Price/Earnings ratio is in line with the industry average.
When comparing the Price/Earnings ratio of SHW to the average of the S&P500 Index (26.31), we can say SHW is valued inline with the index average.
A Price/Forward Earnings ratio of 26.86 indicates a quite expensive valuation of SHW.
62.96% of the companies in the same industry are cheaper than SHW, based on the Price/Forward Earnings ratio.
The average S&P500 Price/Forward Earnings ratio is at 36.56. SHW is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 30.39 | ||
| Fwd PE | 26.86 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, SHW is valued a bit more expensive than the industry average as 77.78% of the companies are valued more cheaply.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of SHW is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 35.11 | ||
| EV/EBITDA | 21.84 |
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)22.44
PEG (5Y)3.03
EPS Next 2Y6.27%
EPS Next 3Y8.46%
5. Dividend
5.1 Amount
With a yearly dividend of 0.92%, SHW is not a good candidate for dividend investing.
SHW's Dividend Yield is slightly below the industry average, which is at 3.88.
With a Dividend Yield of 0.92, SHW pays less dividend than the S&P500 average, which is at 2.32.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.92% |
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 its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)13.53%
Div Incr Years21
Div Non Decr Years21
5.3 Sustainability
30.09% of the earnings are spent on dividend by SHW. This is a low number and sustainable payout ratio.
SHW's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP30.09%
EPS Next 2Y6.27%
EPS Next 3Y8.46%
343.69
+0.3 (+0.09%)
Chartmill FA Rating
GICS SectorMaterials
GICS IndustryGroupMaterials
GICS IndustryChemicals
Earnings (Last)
Earnings (Next)
Inst Owners83.88%
Inst Owner Change-1.03%
Ins Owners0.06%
Ins Owner Change-3.86%
Market Cap85.20B
Revenue(TTM)23.28B
Net Income(TTM)2.57B
Analysts73.33
Price Target394.35 (14.74%)
Short Float %1.69%
Short Ratio1.92
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.92% |
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)2.13%
PT rev (3m)1.71%
EPS NQ rev (1m)-2.43%
EPS NQ rev (3m)-2.96%
EPS NY rev (1m)0.44%
EPS NY rev (3m)0.4%
Revenue NQ rev (1m)2.83%
Revenue NQ rev (3m)2.81%
Revenue NY rev (1m)0.9%
Revenue NY rev (3m)0.92%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 30.39 | ||
| Fwd PE | 26.86 | ||
| P/S | 3.66 | ||
| P/FCF | 35.11 | ||
| P/OCF | 25.87 | ||
| P/B | 19.25 | ||
| P/tB | N/A | ||
| EV/EBITDA | 21.84 |
EPS(TTM)11.31
EY3.29%
EPS(NY)12.79
Fwd EY3.72%
FCF(TTM)9.79
FCFY2.85%
OCF(TTM)13.29
OCFY3.87%
SpS93.89
BVpS17.85
TBVpS-27.57
PEG (NY)22.44
PEG (5Y)3.03
Graham Number67.4
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 | 4.1 |
F-Score5
WACC8.41%
ROIC/WACC1.64
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 30.39 and the Price/Book (PB) ratio is 19.25.
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.