Sherwin-Williams (SHW)
Materials · NYSE · US
Fundamentals
Valuation and ratings
Sherwin-Williams trades at $338.14, which is 39% above the $205.79 our discounted cash flow model puts on the business. On that measure it screens as expensive, which is not the same as saying it will fall.
Our moat model scores it 64 out of 100, which is a moat, but not a deep one. A moat is a structural reason competitors cannot take the profits away, and it matters more to a long holding period than any single quarter's numbers do.
It changes hands at 32.1 times earnings. Be careful reading that in isolation: for a cyclical business a low P/E arrives at the top of the cycle, when profits are peaking and about to fall, which is exactly when the shares look cheapest and are not.
About Sherwin-Williams
The Sherwin-Williams Company engages in the development, manufacture, distribution, and sale of paint, coatings, and related products to professional, industrial, commercial and retail customers. The company operates through three segments: Paint Stores Group, Consumer Brands Group, and Performance Coatings Group. The Paint Stores Group segment offers architectural paint and coatings; protective and marine products; and OEM product finishes and related products for architectural and industrial paint contractors, and do-it-yourself homeowners under the Sherwin-Williams brand. The Consumer Brands Group segment supplies a portfolio of branded and private-label architectural paints, stains, varnishes, industrial products, wood finishes products, wood preservatives, applicators, corrosion inhibitors, aerosols, caulks, and adhesives to retailers, including home centers and hardware stores, and dedicated dealers and distributors. The Performance Coatings Group segment develops and sells industrial coatings for wood finishing and general industrial applications; automotive refinish products; protective and marine coatings; coil coatings; packaging coatings; and performance-based resins and colorants. This segment serves retailers, dealers, jobbers, licensees, and other third-party distributors. The company operates in North America, South America, the Caribbean, Europe, Asia, and Australia. The Sherwin-Williams Company was founded in 1866 and is headquartered in Cleveland, Ohio.
Smart money ownership
21 of the funds we track reported a position in their latest SEC 13F filing. Largest first:
- Capital Research Global, Capital Research Global Investors$1.16B · 0.2% of book
- Andreas Halvorsen, VIKING GLOBAL INVESTORS LP$997.80M · 2.8% of book
- D. E. Shaw, D. E. Shaw & Co., Inc.$476.52M · 0.3% of book
- Parnassus Investments, PARNASSUS INVESTMENTS, LLC$340.88M · 1.0% of book
- Arrowstreet Capital, ARROWSTREET CAPITAL, LIMITED PARTNERSHIP$329.45M · 0.2% of book
A word of warning on reading these figures: a 13F reports the market value of a holding, so a fund that traded nothing at all still appears to have sold when the price fell. We found 102 companies where the standard reading gives the opposite answer. Only the share count is honest.
Common questions
Is Sherwin-Williams (SHW) undervalued?
Against our discounted cash flow estimate of $205.79, SHW at $338.14 is 39% above fair value. That is one model's answer, not a recommendation, and most of a DCF's output sits in a terminal value nobody can forecast.
Which funds own SHW?
21 of the institutions we track reported a position in SHW in their most recent SEC 13F filing. A 13F is filed up to 45 days after quarter end, so it tells you what a fund held then, not what it holds now.
What is SHW's P/E ratio?
SHW trades at 32.1 times earnings. A low P/E is not automatically cheap: on a cyclical company it is usually a warning that earnings are at a peak.
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Data from company filings, exchange quotes and SEC EDGAR 13F disclosures. Quotes are delayed. Metrics we do not have are left out rather than estimated. Educational information, not financial advice.