Sherwin-Williams Company develops, manufactures, distributes, and sells paints, coatings, and related products to professional, industrial, commercial, and retail customers primarily in North and South America. The company was founded in 1866 and is based in Cleveland, Ohio.
SHW Price Forecast Based on DCF Valuation
DCF Fair Value Target:
The table below illustrates the output of a discounted cash flow forecast using a variety of scenarios for Sherwin Williams Co. To summarize, we found that Sherwin Williams Co ranked in the 39th percentile in terms of potential gain offered. Our DCF analysis suggests the stock is overvalued by about 31.67%. The most interesting components of our discounted cash flow analysis for Sherwin Williams Co ended up being:
The stock's equity weight, or the proportion of capital from equity relative to debt, is 82. Notably, its equity weight is greater than 72.32% of US equities in the Basic Materials sector yielding a positive free cash flow.
SHW's estimated cost of debt, based largely on its market capitalization and its interest coverage ratio, is 2%; for context, that number is higher than 27.46% of tickers in our DCF set.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
Want more companies with a valuation profile/forecast similar to that of Sherwin Williams Co? See RPM, TREC, WLK, UFS, and RGLD.
As the world continues to grapple with the coronavirus pandemic, the subsequent economic fallout, and the risk of a second wave, I wanted to look at a series of stocks that are more "recession-resistant". I thought of Sherwin-Williams (SHW) while speaking to some friends who recently repainted their apartments during...
The Sherwin-Williams Company (NYSE: SHW) will issue a press release announcing its financial results for the second quarter ended June 30, 2020 prior to the opening of the market on Tuesday, July 28, 2020. At that time, a copy of the press release and information regarding Sherwin-Williams' financial condition, operating segment results and other information will be available by clicking on the following link, Sherwin-Williams Press Releases, then clicking on the reference to the July 28 release.
The materials sector includes companies engaged in the discovery, development, and processing of raw materials, which are used across many sectors and industries. Materials stocks include manufacturers of products as varied as plastic, fertilizer, paper, concrete, and metals. Materials stocks, as represented by the Materials Select Sector SPDR ETF (XLB), have underperformed the broader market, providing investors with a total return of -1.3% compared to the S&P 500's total return of 7.1% over the past 12 months. These market performance numbers and the statistics in the tables below are as of June 22.