Sherwin-Williams (SHW) Scales 52-week High: What's Driving It?
The Sherwin-Williams Company’s SHW shares reached a fresh 52-week high of $357.64 on Aug 15, before closing at $356.47.
In the past year, the stock has rallied 30.5% against the industry’s 28.2% rise in the same period.
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What’s Driving Sherwin-Williams?
SHW delivered forecast-topping earnings in the second quarter and raised its earnings guidance for 2024.
In the second quarter, SHW reported adjusted earnings of $3.70 per share, exceeding the Zacks Consensus Estimate of $3.51. Revenues for the quarter came in at $6,271.5 million, rising 0.5% year over year but falling short of the Zacks Consensus Estimate of $6,350.1 million. The revenue growth was driven by higher sales volumes in the Paint Stores and Performance Coatings Groups, partially offset by lower volumes in the Consumer Brands Group, including the impact of divesting its China architectural business in 2023.
In the second quarter, the Paint Stores Group segment achieved around 3.5% sales growth, driven by low-single-digit volume increases and higher selling prices, with gains across all end markets except property maintenance. The Performance Coatings Group also posted slight sales growth, supported by an acquisition, though partially offset by currency challenges and varied volume performance across regions and businesses. In contrast, the Consumer Brands Group segment reported a sales decline, primarily due to weaker DIY demand in North America, a divestiture and unfavorable currency effects.
The company anticipates consolidated net sales to grow by a low-single-digit percentage year over year in the third quarter, with similar growth projected for the full year. SHW expects its 2024 earnings per share (EPS) to range between $10.30 and $10.60, with adjusted EPS forecast in the band of $11.10-$11.40.
Sherwin-Williams delivered a trailing four-quarter average earnings surprise of 4.5%. The Zacks Consensus Estimate for its 2024 EPS is pegged at $11.44, calling for an increase of 10.5% from last year’s tally.
The Sherwin-Williams Company Price and Consensus
The Sherwin-Williams Company price-consensus-chart | The Sherwin-Williams Company Quote
Zacks Rank & Key Picks
SHW currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the Basic Materials space are Newmont Corporation NEM, Franco-Nevada Corporation FNV and Agnico Eagle Mines Limited AEM. Newmont and Franco-Nevada sport a Zacks Rank #1 (Strong Buy), and Agnico Eagle carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Newmont’s current-year earnings is pegged at $2.82, indicating a rise of 75% from year-ago levels. The consensus estimate for NEM’s earnings has increased 16% in the past 60 days.The stock has gained nearly 28.8% in the past year.
The Zacks Consensus Estimate for FNV’s current-year earnings is pegged at $3.27. The consensus estimate for FNV’s earnings has increased 3% in the past 60 days. FNV beat the consensus estimate in the last four quarters, with the average earnings surprise being 10.5%.
The Zacks Consensus Estimate for AEM’s current fiscal year earnings is pegged at $3.65, indicating a year-over-year rise of 63.7%. AEM’s earnings beat the Zacks Consensus Estimate in all of the last four quarters, the average earnings surprise being 15.7%. The company’s shares have increased 70% in the past year.
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