Sherwin-Williams
SHW
$323.31
+1.85%
The Sherwin-Williams Company is the largest global manufacturer of paints and coatings, operating through three primary segments: Paint Stores Group (with over 4,800 company-owned stores), Consumer Brands Group (selling through retailers like Lowe's), and Performance Coatings Group (serving industrial applications). As a market leader in the specialty chemicals industry, Sherwin-Williams is recognized for its extensive distribution network and strong brand portfolio. The current investor narrative centers on the company's ability to navigate a challenging demand environment, with recent quarterly results showing modest revenue growth of 6.8% year-over-year, while the stock has underperformed the broader market over the past year, reflecting concerns about end-market softness and margin pressures. Management's focus on cost discipline and strategic investments in high-growth areas, such as industrial coatings, remains a key point of debate among investors.…
SHW
Sherwin-Williams
$323.31
Related headlines
Investment Opinion: Should I buy SHW Today?
Based on the analysis, SHW is rated a 'Buy' with a thesis that its dominant market position, revenue growth, and margin expansion will drive earnings growth, justifying a premium valuation. The consensus analyst rating is 'Buy' with an average target of $391, implying 17.2% upside. This rating is supported by strong fundamentals, including 6.8% revenue growth, improving gross margins, and robust free cash flow.
Sign up to view all
SHW 12-Month Price Forecast
The AI model assesses SHW as a moderate buy, given its solid growth, margin improvements, and analyst support. However, the high debt and macro sensitivity warrant caution. The stance would be upgraded if revenue growth accelerates above 8% or if the stock's relative strength turns positive. Conversely, a downgrade would occur if revenue growth falls below 3% or if the debt-to-equity ratio increases significantly.
Wall Street consensus
Most Wall Street analysts maintain a constructive view on Sherwin-Williams's 12-month outlook, with a consensus price target around $391.00 and implied upside of +20.9% versus the current price.
Average Target
$391.00
0 analysts
Implied Upside
+20.9%
vs. current price
Analyst Count
—
covering this stock
Price Range
$340 - $420
Analyst target range
Sherwin-Williams is covered by 22 analysts, with a consensus recommendation of 'Buy' and a mean rating of 1.96 (where 1 is Strong Buy and 5 is Sell). The average price target is $391.00, implying an upside of 17.2% from the current price of $333.71. The distribution of ratings is not explicitly provided, but the mean rating suggests a majority of analysts are bullish, with some neutral and no bearish ratings. The high target of $420.00 implies an upside of 25.9%, while the low target of $340.00 implies a modest upside of 1.9%, indicating that even the most bearish analyst sees limited downside. The wide range between the low and high targets ($80) reflects uncertainty about the pace of recovery in the housing and industrial markets, as well as the impact of raw material costs. Recent institutional ratings actions have been mostly positive, with RBC Capital, BMO Capital, and Citigroup reiterating Buy or Outperform ratings in June and July 2026, while UBS downgraded from Buy to Neutral in June 2026, suggesting some divergence in sentiment. Overall, the consensus leans bullish, with analysts expecting the company to benefit from its strategic initiatives and market recovery.
Bulls vs Bears: SHW Investment Factors
Sherwin-Williams presents a mixed picture: strong fundamentals including revenue growth, margin expansion, and a dominant market position are offset by high debt, underperformance, and valuation concerns. The bull case is supported by accelerating revenue and analyst optimism, while the bear case highlights macro risks and leverage. Currently, the evidence slightly favors the bulls given the company's pricing power and free cash flow, but the key tension is whether the company can sustain growth in a high-interest-rate environment. If housing and industrial demand recover, the stock could re-rate higher; if not, the premium valuation may compress.
Bullish
- Dominant Market Position: Sherwin-Williams is the largest global paint and coatings manufacturer with over 4,800 company-owned stores, providing a vast distribution network and strong brand recognition. This scale creates significant competitive advantages in procurement, marketing, and customer loyalty.
- Revenue Growth Accelerating: Q1 2026 revenue grew 6.8% YoY to $5.67 billion, up from $5.31 billion in Q1 2025, with sequential improvement from Q4 2025's 5.6% growth. This acceleration suggests strengthening demand across its segments, particularly in Paint Stores Group.
- Margin Expansion Potential: Gross margin improved to 49.1% in Q1 2026 from 48.2% a year ago, reflecting successful pricing actions and raw material cost management. This trend, if sustained, could drive operating leverage and EPS growth.
- Analyst Consensus Bullish: With 22 analysts, the consensus is 'Buy' with a mean rating of 1.96 (1=Strong Buy). The average price target of $391 implies 17.2% upside from the current price of $333.71, and even the low target of $340 is above the current price.
Bearish
- Significant Underperformance: Over the past year, SHW declined 8.77% while the S&P 500 gained 18.65%, resulting in a relative strength of -27.42%. This persistent underperformance signals potential structural issues or market concerns about the company's growth prospects.
- High Debt Levels: Debt-to-equity ratio is 2.81, indicating substantial leverage. With interest expense of $131.6 million in Q1 2026, rising interest rates could pressure earnings and limit financial flexibility.
- Operating Margin Pressure: Despite higher gross margin, operating margin declined to 14.3% in Q1 2026 from 14.2% a year ago, due to increased SG&A expenses. This suggests that cost control is not fully offsetting investments in growth.
- Valuation Premium to Peers: Forward PE of 24.5x is 11% above the industry average of 22x. While justified by market leadership, this premium could compress if growth disappoints, leading to multiple contraction.
SHW Technical Analysis
The stock is currently in a range-bound consolidation phase, trading at $333.71 as of September 4, 2026, which is approximately 88% of its 52-week range (between $289.86 low and $377.77 high). Over the past year, the stock has declined 8.77%, while the S&P 500 has gained 18.65%, indicating significant underperformance. The stock's beta of 1.089 suggests slightly higher volatility than the market, and its relative strength versus the S&P 500 over the past year is -27.42%, highlighting persistent weakness relative to the broader index.
Beta
1.09
1.09x market volatility
Max Drawdown
-21.9%
Largest decline past year
52-Week Range
$290-$378
Price range past year
Annual Return
-12.3%
Cumulative gain past year
| Period | SHW Return | S&P 500 |
|---|---|---|
| 1m | -10.2% | -1.1% |
| 3m | +1.9% | +3.0% |
| 6m | +1.1% | +15.4% |
| 1y | -12.3% | +16.2% |
| ytd | -1.4% | +12.1% |
Bobby - Your AI Investment Partner
Get real-time data, AI-driven personalized investment analysis to make smarter investment decisions
SHW Fundamental Analysis
In the most recent quarter (Q1 2026, ended March 31, 2026), Sherwin-Williams reported revenue of $5.67 billion, up 6.8% year-over-year from $5.31 billion in Q1 2025. This growth was driven by the Paint Stores Group, which generated $3.05 billion in revenue, and the Consumer Brands Group at $2.19 billion, while the Performance Coatings Group contributed $1.72 billion. However, revenue growth has been uneven across recent quarters: Q3 2025 saw revenue of $6.36 billion (up from $6.16 billion in Q3 2024), and Q4 2025 revenue was $5.60 billion (up from $5.30 billion in Q4 2024), indicating a deceleration from the mid-single-digit growth rates seen in mid-2025. The company's gross margin improved to 49.1% in Q1 2026 from 48.2% in Q1 2025, reflecting pricing actions and raw material cost management, but operating margin declined to 14.3% from 14.2% in the year-ago quarter due to higher SG&A expenses. Net income for Q1 2026 was $534.7 million, up from $503.9 million in Q1 2025, with net margin improving to 9.4% from 9.5%.
Quarterly Revenue
$5.7B
2026-03
Revenue YoY Growth
+6.8%
YoY Comparison
Gross Margin
49.1%
Latest Quarter
Free Cash Flow
$2.9B
Last 12 Months
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
Open an Account, get $2 TSLA now!
Valuation Analysis: Is SHW Overvalued?
Given that Sherwin-Williams is profitable, the primary valuation metric selected is the price-to-earnings (PE) ratio. The trailing PE is 31.2x, while the forward PE is 24.5x, indicating that the market expects earnings growth of approximately 27% over the next year. This gap between trailing and forward multiples suggests that the market is pricing in a significant recovery in profitability, likely driven by margin expansion and revenue growth. The company's PEG ratio is negative at -11.1, which is not meaningful due to the negative earnings growth rate used in the calculation, but the forward PE of 24.5x is above the industry average of 22x, representing a 11% premium. This premium is justified by Sherwin-Williams' dominant market position, strong brand portfolio, and consistent free cash flow generation, which supports a higher multiple. Historically, the stock has traded at a PE range of roughly 19x to 75x over the past five years, with the current trailing PE of 31.2x sitting near the lower end of that range, suggesting that the stock is not overvalued relative to its own history.
PE
31.2x
Latest Quarter
vs. Historical
Low-End
5-Year PE Range 19x~56x
vs. Industry Avg
N/A
Industry PE ~N/A*
EV/EBITDA
21.1x
Enterprise Value Multiple
Investment Risk Disclosure
Financial risks are notable due to Sherwin-Williams' high debt-to-equity ratio of 2.81, which amplifies vulnerability to rising interest rates. In Q1 2026, interest expense was $131.6 million, and with a current ratio of 0.87, the company's liquidity position is tight, potentially limiting flexibility in a downturn. However, strong free cash flow of $2.91 billion TTM provides a cushion, and the company's 47-year dividend increase streak indicates a commitment to shareholder returns, but this could be at risk if cash flows deteriorate.