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. While SHW has a great profitability rating, 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
In the past year SHW was profitable.
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.
SHW has a better Return On Equity (58.12%) than 100.00% of its industry peers.
SHW has a better Return On Invested Capital (13.81%) than 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 6.07%.
| 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.
In the last couple of years the Profit Margin of SHW has grown nicely.
Looking at the Operating Margin, with a value of 15.81%, SHW is in the better half of the industry, outperforming 79.01% of the companies in the same industry.
SHW's Operating Margin has improved in the last couple of years.
SHW has a Gross Margin of 48.88%. This is amongst the best in the industry. SHW outperforms 95.06% of its industry peers.
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.
SHW has less shares outstanding than it did 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
An Altman-Z score of 4.12 indicates that SHW is not in any danger for bankruptcy at the moment.
SHW has a better Altman-Z score (4.12) than 88.89% of its industry peers.
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.
SHW's Debt to FCF ratio of 4.75 is amongst the best of the industry. SHW outperforms 82.72% of its industry peers.
SHW has a Debt/Equity ratio of 2.52. This is a high value indicating a heavy dependency on external financing.
SHW has a Debt to Equity ratio of 2.52. This is amonst the worse of the industry: SHW underperforms 82.72% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.52 | ||
| Debt/FCF | 4.75 | ||
| Altman-Z | 4.12 |
ROIC/WACC1.67
WACC8.27%
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.
With a Current ratio value of 0.82, SHW is not doing good in the industry: 93.83% of the companies in the same industry are doing better.
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.
The Quick ratio of SHW (0.52) is worse than 91.36% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.82 | ||
| Quick Ratio | 0.52 |
3. Growth
3.1 Past
SHW shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 2.35%.
SHW shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 10.02% yearly.
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
The Earnings Per Share is expected to grow by 8.04% on average over the next years. This is quite good.
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
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
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 30.39, SHW can be considered very expensive at the moment.
Compared to the rest of the industry, the Price/Earnings ratio of SHW is on the same level as its industry peers.
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.
Based on the Price/Forward Earnings ratio of 26.86, the valuation of SHW can be described as expensive.
SHW's Price/Forward Earnings ratio is a bit more expensive when compared to the industry. SHW is more expensive than 62.96% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of SHW to the average of the S&P500 Index (36.59), we can say SHW is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 30.39 | ||
| Fwd PE | 26.86 |
4.2 Price Multiples
77.78% of the companies in the same industry are cheaper than SHW, based on the Enterprise Value to EBITDA ratio.
The rest of the industry has a similar Price/Free Cash Flow ratio as SHW.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 35.32 | ||
| EV/EBITDA | 21.94 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The excellent profitability rating of SHW 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
SHW has a yearly dividend return of 0.96%, which is pretty low.
SHW's Dividend Yield is slightly below the industry average, which is at 4.16.
With a Dividend Yield of 0.96, SHW pays less dividend than the S&P500 average, which is at 2.40.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.96% |
5.2 History
The dividend of SHW is nicely growing with an annual growth rate of 13.53%!
SHW has been paying a dividend for at least 10 years, so it has 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-0.94%
Ins Owners0.06%
Ins Owner Change-3.88%
Market Cap85.69B
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 | 0.96% |
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)1.71%
PT rev (3m)1.71%
EPS NQ rev (1m)-2.52%
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 | 3.68 | ||
| P/FCF | 35.32 | ||
| P/OCF | 26.02 | ||
| P/B | 19.36 | ||
| P/tB | N/A | ||
| EV/EBITDA | 21.94 |
EPS(TTM)11.31
EY3.29%
EPS(NY)12.79
Fwd EY3.72%
FCF(TTM)9.73
FCFY2.83%
OCF(TTM)13.21
OCFY3.84%
SpS93.35
BVpS17.75
TBVpS-27.41
PEG (NY)22.44
PEG (5Y)3.03
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 | 4.12 |
F-Score5
WACC8.27%
ROIC/WACC1.67
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 19.36.
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.