AI Consensus Investment Thesis
SHW: The Sherwin-Williams Stock Price, Analysis & Forecast: 1 Year and 5 Year Targets
The Sherwin-Williams: 1-Year and 5-Year Forecast Outlook and Rating
The Sherwin-Williams (SHW) has an immediate No Action - Keep Monitoring consensus AI recommendation, based on 14 AI analysts.
The 1-year target is $328 for , with -2.38% expected return (-1.79% including net dividends) and a PARTIAL SELL rating.
The 5-year target is $456 for , with +35.71% expected return (+40.20% including net dividends) and a NEUTRAL rating.
Latest available market price: USD 336, as of 20 Oct 2026.
Dividend calculation details
Calculated net annual dividend yield: 0.66%. As of 2026-10-20.
Gross TTM: 0.95% · Two-year annualized gross: 0.93%.
Tax withholding assumption: 30% (US). One-off special payments are excluded.
Original published assumption: 0.6% per year.
Return estimates compound the net annual yield at a constant rate over the stated return horizon (the remaining time to the fixed target date for current returns): (1 + price return) × (1 + net annual yield)years − 1.
Targets retain their original publication dates. Returns use the dated market close and the time remaining to each fixed target date. Current ratings also require fresh quotes and analysis, with more than 90 days remaining. Past targets have no forward return. Eligibility checked .
The Sherwin-Williams Flagship Insight
Controlled Store Distribution Moat Counters Frozen Housing Stagnation And Upstream Petrochemical Squeeze
Analysis indicates high consensus that captive store distribution and post-construction free cash flow defend underlying earnings from stagnant residential housing turnover. A sharp divergence persists regarding valuation sustainability, as five-percent sovereign bond yields and elevated petrochemical feedstock costs threaten to compress premium earnings multiples across economic cycles.
How were the Investment Thesis and Forecasts created?
14 AI advisors, guided by 9 analytical frameworks, contribute to the deep analysis by iPulse AI Engine.
Sherlock Holmes (Whistleblower)
Universal Investor (Polymath)
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J.P. Morgan (Titan)
Michael Burry (Vulture)
Elon Musk (Visionary)
Warren Buffett (Value Purist)
Machiavelli (Insider)
Ray Dalio (Strategist)
Ran across these frontier AI models
Google Gemini 3.8 Flash
Anthropic Claude Opus 5
OpenAI GPT-6 Astra
Latest published deep-analysis batch. Audit published forecasts in full transparency
The Sherwin-Williams: forecast questions
What is The Sherwin-Williams (SHW)'s 1-year price forecast?
The Sherwin-Williams's 1-year target is $328 for Sept 2027. The current AI rating is PARTIAL SELL. The expected return from the recorded close is -2.38%, or -1.79% modeled return including net dividends. Latest available market price: USD 336, as of 20 Oct 2026. The target date is fixed; this is not a new rolling forecast.
What is The Sherwin-Williams (SHW)'s 5-year price forecast?
The Sherwin-Williams's 5-year target is $456 for Sept 2031. The current AI rating is NEUTRAL. The expected return from the recorded close is +35.71%, or +40.20% modeled return including net dividends. Latest available market price: USD 336, as of 20 Oct 2026. The target date is fixed; this is not a new rolling forecast.
What is the return basis?
Latest available market price: USD 336, as of 20 Oct 2026. These are model projections, not guaranteed future prices.
How can I compare the AI opinions and audit past The Sherwin-Williams forecasts?
14 AI analysts contribute to this publication. AI Opinions shows individual advisor forecasts and reasoning. Forecast History preserves earlier published batches; their figures describe their original publication, not today's outlook.
How does an AI-generated forecast for The Sherwin-Williams differ from Wall Street analyst consensus?
Wall Street consensus aggregates estimates from human analysts. For listed companies, these typically include brokerage price targets, earnings forecasts and ratings. iPulse AI's forecast for The Sherwin-Williams is a separate AI consensus generated through its own research workflow. Different inputs, forecast dates, assumptions and weighting can therefore produce different targets.
We believe the era of investment research conducted only by human analysts is drawing to a close. Frontier models increasingly match or exceed expert work on selected professional benchmarks, including evaluations covering financial analysis. Research on multi-model synthesis also shows that combining model responses can improve on a single model's output in the tasks studied.
iPulse AI generates transparent investment research and market forecasts using a swarm of AI configurations, analytical frameworks and frontier models. The workflow applies multiple verification, challenge and synthesis layers, with selective editorial review under Russlan Ramdowar, Editor-in-Chief. Published assumptions, disagreements and past forecasts remain available so readers can inspect the reasoning and audit outcomes.
For a research cycle covering 426 assets with 14 perspectives per asset, our internal workload model estimates approximately 114,000 hours of traditional analyst work. It assumes 16 hours per individual research report, 28 hours per consensus for synthesis and validation, plus shared data preparation. Parallel AI execution allows a deep-analysis cycle across hundreds of assets to complete in up to one day. The human-hours figure is an illustrative workload estimate, rather than measured time savings. Our research methodology explains the automated workflow.
The Sherwin-Williams: Investment Thesis Summary
Dotted terms link to the glossary; hover or focus for a preview. Browse technical terms
If you invest $10,000 in The Sherwin-Williams at the latest market close (20 Oct 2026): $14,020 by Sept 2031 versus $13,751 for S&P 500 benchmark.
Returns use the same dated market close, fixed targets and remaining dividend period as the forecast table.
* Return is calculated incl. 0.7% net dividend yield for The Sherwin-Williams.
The core investment thesis hinges on the tension between an unmatched controlled distribution moat and elevated equity duration risk. With over 4,850 company-operated stores locking in professional contractors whose labor comprises the dominant share of painting invoices, pricing power remains structurally asymmetric. List price increases permanently reset gross margins higher even as petrochemical feedstock costs eventually normalize. Concurrently, the completion of major corporate capital projects normalizes capital intensity toward two percent of sales, expanding annual free cash flow above three billion dollars. However, trading near thirty times earnings against five-percent sovereign bond yields leaves zero margin of safety if housing turnover remains frozen.
Key insights
- Labor cost dominance renders contractor paint demand largely price-inelastic, enabling permanent gross margin resets that outlast cyclical fluctuations in crude-derived chemical resins.
- Capital expenditure roll-off from completed headquarters construction permanently liberates discretionary cash flow, shifting capital allocation toward debt reduction and mechanical per-share buyback accretion.
- Elevated risk-free yields create an acute negative equity risk premium, forcing total shareholder returns to rely on organic compounding rather than speculative multiple expansion.
The Sherwin-Williams: 5 Year Consensus Forecast
20 quarterly price targets, returns and rationale, with advisor range and benchmark
Forward returns are updated using the latest market close price of USD 336, as of 20 Oct 2026.
Dividend calculation details
Calculated net annual dividend yield: 0.66%. As of 2026-10-20.
Gross TTM: 0.95% · Two-year annualized gross: 0.93%.
Tax withholding assumption: 30% (US). One-off special payments are excluded.
Original published assumption: 0.6% per year.
Return estimates compound the net annual yield at a constant rate over the stated return horizon (the remaining time to the fixed target date for current returns): (1 + price return) × (1 + net annual yield)years − 1.
The consensus target follows an expert-weighted price path synthesized from 14 AI advisor opinions. See Opinion weights and rationale for the exact allocation and reasoning.
Forecast methodology and reference values
Published targets are anchored on 18 Sept 2026 at USD 321. Original quarter-to-quarter target changes are retained. Forward returns use the remaining time to each fixed target date.
The pessimistic and optimistic advisor base cases are the lowest and highest published advisor base-case targets for each quarter. The advisor at either extreme can change between quarters. Benchmark values are in USD.
Scroll the table horizontally to read every column.
| Quarter | Evidence-Weighted Consensus Price Path | Individual Advisor Range & Reference Forecasts | ||||||
|---|---|---|---|---|---|---|---|---|
| Consensus target (USD) | Forecast quarter-to-quarter price change | Forward price return | Forward return incl. net dividends | Forecast rationale | Pessimistic Advisor Base Case (USD) | Optimistic Advisor Base Case (USD) | S&P 500 benchmark (USD) | |
| $319 | -0.65% | -5.06% | -4.96% | Realization of the September eight-percent price hike counterbalances elevated crude-driven resin costs. Architectural volume softens seasonally while five-percent Treasury yields exert initial multiple compression, resulting in modest equity price consolidation through year-end. | $305 | $334 | $750 | |
| $315 | -1.23% | -6.25% | -6.00% | Winter seasonal lull meets lagged petrochemical feedstock inflation, squeezing first-quarter gross margins slightly. Sluggish existing home turnover keeps residential paint shipments subdued, tempering analyst earnings projections and anchoring valuation multiples near current levels. | $289 | $337 | $736 | |
| $321 | +2.15% | -4.47% | -4.05% | Spring exterior painting activity accelerates contractor demand, confirming successful realization of prior price hikes. Operating leverage expands across company-owned stores, while post-construction free cash flow conversion fuels steady share repurchases, supporting equity appreciation. | $275 | $350 | $743 | |
| $328 | +1.92% | -2.38% | -1.79% | Peak summer architectural volume throughput combines with strong data center protective coatings demand to deliver solid operating profits. Stabilizing petrochemical spot prices protect gross margins, reassuring institutional investors and driving modest positive revisions. | $264 | $361 | $755 | |
| $332 | +1.28% | -1.19% | -0.43% | Seasonal volume tapering is cushioned by corporate share buybacks funded by normalized capital expenditures. Valuation multiples stabilize as investors recognize resilient cash conversion, offsetting broader macroeconomic concerns regarding sticky mortgage rates. | $259 | $372 | $776 | |
| $340 | +2.33% | +1.19% | +2.14% | Prospects of monetary policy easing begin thawing commercial real estate sentiment. Contractor pre-orders ahead of spring and modest raw material deflation improve gross profit dollars, allowing operating earnings to advance during the seasonal trough. | $261 | $383 | $787 | |
| $351 | +3.47% | +4.46% | +5.62% | Easing mortgage rates stimulate an initial uptick in existing home sales, releasing pent-up residential repaint demand. High operating leverage across the captive retail footprint drives significant earnings expansion, sparking renewed institutional equity accumulation. | $269 | $398 | $803 | |
| $359 | +2.18% | +6.84% | +8.21% | Summer volume execution reaches high levels across both Paint Stores and Performance Coatings divisions. Sustained pricing realization paired with lower chemical input costs expands gross margins toward fifty percent, generating record quarterly cash generation. | $274 | $410 | $812 | |
| $365 | +1.79% | +8.63% | +10.20% | Management executes opportunistic share retirements and announces the annual dividend increase, reinforcing high return on equity. Defensive maintenance repaint revenues shield the business from broader macroeconomic cooling, preserving firm equity pricing. | $283 | $418 | $839 | |
| $373 | +2.04% | +11.01% | +12.79% | Continued housing mobility recovery supports healthy contractor project backlogs across Sunbelt markets. Disciplined retail store expansion captures market share from independent paint dealers, delivering steady low-single-digit sales growth and solid margin defense. | $288 | $431 | $851 | |
| $384 | +2.97% | +14.28% | +16.31% | A strong spring repaint season accelerates architectural volume growth across company-operated stores. Operating leverage on incremental gallons combined with stable input pricing delivers double-digit operating income expansion, driving solid quarterly share performance. | $300 | $444 | $872 | |
| $392 | +2.08% | +16.66% | +18.94% | Peak seasonal throughput demonstrates widening competitive separation from wholesale distributors. Free cash flow conversion remaining above eighty percent funds debt paydown toward targeted leverage corridors, supporting balanced per-share value compounding. | $309 | $453 | $886 | |
| $398 | +1.47% | +18.45% | +20.96% | Year-end commercial maintenance contracts and industrial wood coatings demand offset seasonal residential slowdowns. Systematic equity shrinkage through ongoing share repurchases steadily elevates per-share earnings power, concluding the year with dependable financial results. | $315 | $462 | $910 | |
| $406 | +1.98% | +20.83% | +23.59% | Routine early-year price adjustments take effect smoothly across professional contractor accounts without volume attrition. Stable raw material supply chains preserve unit profitability, positioning the company for reliable cash generation heading into spring. | $325 | $471 | $916 | |
| $417 | +2.70% | +24.10% | +27.15% | Robust demand across infrastructure, automotive refinish, and residential repaint segments drives peak seasonal earnings. Operating margins expand as automated distribution logistics reduce unit handling costs, rewarding patient shareholders with continued equity appreciation. | $334 | $485 | $937 | |
| $425 | +1.96% | +26.48% | +29.80% | Performance Coatings Group benefits from ongoing domestic manufacturing reshoring and public works investments. Diversified segment earnings protect consolidated operating income, generating strong operating cash flows that sustain regular capital return programs. | $341 | $495 | $947 | |
| $430 | +1.24% | +27.97% | +31.55% | Standard winter construction slowdowns prompt seasonal volume moderation across northern markets. Net debt-to-EBITDA approaches management's optimal corridor, providing pristine balance sheet durability and supporting steady equity valuation into year-end. | $342 | $500 | $970 | |
| $438 | +1.79% | +30.35% | +34.22% | Resilient maintenance repaint demand across an aging housing stock buffers against broader economic maturity. Controlled store network density ensures high contractor retention, sustaining predictable early-year cash flows and supporting modest price gains. | $349 | $510 | $980 | |
| $449 | +2.52% | +33.63% | +37.82% | Final-year peak exterior painting season delivers excellent volume throughput and operating leverage across company-owned stores. Decades of compounding distribution dominance and pricing power culminate in robust operating profits, driving strong seasonal appreciation. | $356 | $525 | $1,000 | |
| $456 | +1.64% | +35.71% | +40.20% | The five-year forecast horizon concludes with normalized valuation multiples reflecting mature compounder quality. Sustained share cannibalization, structural gross margin expansion, and captive distribution dominance complete a cycle of dependable shareholder value creation. | $359 | $535 | $1,012 | |
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The Sherwin-Williams Stock Analysis & Scenarios Deep Dive
The Sherwin-Williams: Alpha Gap & Repricing Catalysts
Market Narrative
What does the market currently expect? Market consensus prices the company as an invulnerable compounder possessing boundless pricing power and consumer-staple stability. Outside investors anchor on historical resilience, assuming captive contractor loyalty guarantees double-digit earnings growth regardless of housing freezes. Public commentary presumes that an imminent residential turnover revival and falling chemical costs will comfortably justify a premium valuation multiple near thirty times earnings despite five-percent sovereign bond yields.
Alpha Gap
What is the biggest difference between market expectations and our AI forecasts? The crowd overestimates near-term valuation durability while underappreciating free cash flow conversion dynamics. Outside consensus treats thirty times earnings as permanent quality, overlooking that a three-point-four percent earnings yield is mathematically vulnerable against five-percent Treasury yields and sluggish existing home sales. However, the market also overlooks how the roll-off of corporate headquarters capital expenditures elevates free cash flow conversion above one hundred percent of net income. This liberated cash flow fuels accretive share cannibalization that compounds per-share intrinsic value even during volume stagnation.
Repricing Catalyst
What could make the market recognize and close that gap? The primary convergence catalyst is the consecutive reporting of late-2026 and early-2027 financial results demonstrating whether the September eight-percent price hike fully offsets petrochemical feedstock inflation. Observable gross margin stability above forty-nine percent alongside reported free cash flow exceeding three billion dollars will test consensus expectations. Repricing will occur as institutional investors calibrate forward multiples against proven per-share cash conversion rather than speculative top-line volume acceleration.
The Sherwin-Williams: Sentiment and Timing
What do sentiment, volatility, and the market-recognition cycle suggest about the thesis timing?
- Greed and Fear Sentiment
- Balanced
- Volatility Regime
- Moderate
- Convergence Cycle Position
- Stabilization
Sentiment assessments diverge between views framing current valuation as an unsustainable overshoot vulnerable to sovereign yield competition and those interpreting the setup as cyclical stabilization. This tension dictates whether near-term performance is dominated by multiple contraction or steady earnings compounding.
Macro Regime Fit
Does the current market environment support the thesis? The prevailing macroeconomic regime of four-percent policy rates, five-percent Treasury yields, and triple-digit crude oil constitutes a clear operational headwind. Elevated mortgage rates freeze residential housing turnover and mute paint volume demand, while expensive petrochemicals inflate manufacturing costs. However, resilient non-residential infrastructure spending and captive commercial contractor pricing provide decisive defensive insulation.
Advisor Disagreement
What do our AI Advisors disagree about most? The primary analytical disagreement centers on valuation multiple durability versus organic volume elasticity. One camp argues that captive distribution and the asymmetric pricing ratchet justify sustaining a premium multiple near thirty times earnings, bolstered by post-construction free cash flow conversion. Opposing views contend that five-percent risk-free Treasury yields and generational housing turnover stagnation must mathematically de-rate the multiple toward historical averages of twenty-two times, regardless of pricing power. Resolving this debate requires tracking whether Paint Stores Group same-store volumes expand alongside the September price increase or whether contractor resistance signals underlying demand destruction.
The Sherwin-Williams: Critical Influencing Factors
Near-certain positive forcesTop Drivers & Tailwinds
Near-certain forces that support the investment thesis. These forces are treated as part of the base case (more than 60% probability of occurrence). Impact columns are specific to this asset class.
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| Driver / Tailwind | Category | Est. stock-price impact | Est. earnings impact | Why it matters |
|---|---|---|---|---|
| Captive store network distribution moat | Competitive Positioning | +20% | +24% | Operating over 4,850 company-owned retail locations creates an insurmountable distribution chokepoint locking in professional painting contractors. Because labor represents the vast majority of contractor job costs, proximity, immediate custom tinting, and commercial credit outweigh minor paint price differentials. This captive ecosystem isolates architectural margins from big-box retailer competition, securing durable pricing power and compounding cash generation. |
| Asymmetric pricing power margin ratchet | Operational Efficiency | +18% | +20% | The company exhibits proven pricing power, exemplified by an eight-percent architectural list price increase implemented in September 2026. Historically, price hikes introduced to counter petrochemical inflation remain permanently in place when feedstock prices deflate. This structural ratchet expands consolidated gross margins toward fifty percent, converting temporary raw material relief into enduring operating leverage and expanded cash flow. |
| Post-construction capital expenditure cliff | Capital Allocation | +15% | +14% | The operational completion of the multi-year Cleveland corporate headquarters and Brecksville technology center marks a structural turning point in capital allocation. Capital expenditures are normalizing from peak levels above 4.5% of revenue toward baseline maintenance rates near 2.0%. This capex cliff liberates over $400 million in annual discretionary cash flow, directly accelerating share buybacks and dividend growth. |
| Protective coatings and onshoring expansion | Sector And Industry | +13% | +16% | Secular federal infrastructure investments, domestic semiconductor fabrication, and data center buildouts fuel robust demand for high-performance protective and marine coatings. These specialized formulations command superior operating margins and sticky multi-year enterprise contracts. Countercyclical non-residential expansion insulates group revenue from residential construction softness, lifting Performance Coatings operating profitability and diversifying consolidated cash flows across economic cycles. |
Near-certain negative forcesTop Frictions & Headwinds
Near-certain forces that could slow, cap, or damage the thesis. These forces are treated as part of the base case (more than 60% probability of occurrence). Impact columns are specific to this asset class.
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| Friction / Headwind | Category | Est. stock-price impact | Est. earnings impact | Why it matters |
|---|---|---|---|---|
| Premium valuation multiple contraction drag | Competitive Positioning | -16% | -3.0% | Trading near thirty times trailing earnings and twenty times EBITDA, the equity carries a steep valuation premium offering minimal margin of safety. With ten-year Treasury yields hovering near five percent, the implied equity risk premium is deeply compressed. Even minor organic volume decelerations risk triggering substantial multiple de-rating toward historical industrial averages, creating persistent equity headwinds. |
| Mortgage lock-in freezes housing turnover | Macroeconomic And Macrofinancial | -14% | -14% | Elevated benchmark interest rates and mortgage rates near seven percent sustain a severe residential lock-in effect, keeping US existing home sales depressed near generational lows. Because residential property transactions represent the primary catalyst for discretionary architectural repainting, Paint Stores Group volume faces persistent stagnation. This macro freeze restricts gallon throughput across retail stores, impairing operating leverage. |
| Petrochemical feedstock cost inflation lag | Macroeconomic And Macrofinancial | -11% | -13% | Renewed geopolitical conflict in the Middle East pushing crude oil above one hundred dollars per barrel directly inflates costs for acrylic resins, monomers, and solvents. While long-term pricing power is intact, customary realization lags between raw material spikes and contractor price increases compress intermediate gross margins, muting near-term operating income conversion during energy escalation periods. |
| Balance sheet leverage and refinancing costs | Capital Allocation | -8.0% | -9.0% | A debt-to-equity ratio of 2.81 and gross debt exceeding twelve billion dollars introduce financial friction in a restrictive monetary regime. Maturing low-coupon debt tranches must be refinanced at prevailing corporate yields above five percent. Escalating annual interest expense absorbs operating cash flow, constraining balance sheet flexibility and limiting discretionary capital allocated to share repurchases. |
The Sherwin-Williams: What Could Break or Accelerate the Thesis
Event Risk Score: Low 35/100Asset-level relative pressure from clustered consensus frictions and tail risks. This is not the probability or risk score of an individual force.Plausible downside scenariosTail Risks
Tail yet plausible downside scenarios selected for their highest potential impact.
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| Tail scenario | Chance of Occurring | Stock Price Impact | Why plausible / what changes |
|---|---|---|---|
| Severe stagflation and commercial construction crash | 28% | -26% | Persistent stagflation driven by sustained five-percent sovereign yields and sticky inflation could trigger severe distress across commercial property and residential construction. Project cancellations, tenant improvement freezes, and rising contractor insolvencies would cause double-digit volume drops in Paint Stores and Performance Coatings. Fixed retail overhead would cause severe operational deleverage, slashing operating income by twenty percent. Broad economic resilience keeps probability at 28%. |
| Protracted Persian Gulf energy infrastructure shutdown | 20% | -25% | A military escalation closing the Strait of Hormuz could push crude oil sustainably above $130 per barrel, causing severe global feedstock rationing. Acrylic acid, resin, and solvent costs would double rapidly, exceeding contractor absorption capacity. Operating margins would compress by over 400 basis points as volume buckles under demand destruction, severely impairing annual free cash flow. International diplomatic intervention limits likelihood to 20%. |
Plausible upside scenariosTail Opportunities
Tail yet plausible upside scenarios selected for their highest potential impact.
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| Tail scenario | Chance of Occurring | Stock Price Impact | Why plausible / what changes |
|---|---|---|---|
| Aggressive monetary easing unlocks housing velocity | 32% | +26% | A sharp macroeconomic disinflation pivot prompting central banks to cut policy rates by 150 to 200 basis points would drive mortgage rates below 5.5%. Breaking the housing lock-in freeze would release years of deferred residential repaint demand. Architectural volumes would surge, generating tremendous store operating leverage that expands margins beyond twenty percent. Ongoing inflation risks keep probability capped at 32%. |
| Distressed international coatings competitor consolidation | 22% | +20% | Prolonged industrial stagnation or regulatory pressures across Europe could force distressed international coatings rivals into divestitures of premier decorative or industrial assets. Leveraging post-headquarters free cash flow and investment-grade balance sheet liquidity, management could execute a transformational multi-billion-dollar acquisition at cyclical trough valuations. Purchasing synergies and overseas distribution scale would accelerate normalized EPS growth, though antitrust scrutiny restricts probability to 22%. |
Company Financial AnalysisThe Sherwin-Williams: Earnings and Financials Analysis by AI
Financial figures available as of Sep 20, 2026. Only filings and source records available by this analysis date are included. View latest The Sherwin-Williams financials here.
Earnings and financials
The latest financial results tell a story of pricing strength overcoming sluggish volume. Second-quarter 2026 sales reached $6.79 billion, rising 7.5% as price increases and specialty industrial coatings offset subdued residential repainting. Net income expanded to $844 million, showing that professional painting contractors continue absorbing price hikes to ensure steady paint supply for active jobs. Beneath headline revenue, underlying growth relies more on price than physical gallons sold. However, cash generation remains stellar, with trailing free cash flow reaching $3.21 billion. This reliable cash stream confirms that the company's captive retail stores provide high-quality recurring profitability, insulating business cash flows from broader housing transaction slowdowns.
Revenue, earnings, and cash flow
The table compares up to five fiscal years of revenue, net income, and free cash flow available to this analysis.
| Fiscal year | Revenue | Net income | Free cash flow |
|---|---|---|---|
| 2025 | USD 23.6B | USD 2.6B | USD 2.7B |
| 2024 | USD 23.1B | USD 2.7B | USD 2.1B |
| 2023 | USD 23.1B | USD 2.4B | USD 2.6B |
| 2022 | USD 22.1B | USD 2B | USD 1.3B |
| 2021 | USD 19.9B | USD 1.9B | USD 1.9B |
Valuation context: historical P/E
The table compares up to five fiscal years of point-in-time valuation evidence available to this analysis.
| Fiscal year | P/E | Earnings basis | Currency basis | Ticker / reporting |
|---|---|---|---|---|
| 2025 | 31.4x | TTM | Native | USD / USD |
| 2024 | 32.2x | TTM | Native | USD / USD |
| 2023 | 33.5x | TTM | Native | USD / USD |
| 2022 | 30.6x | Annual | Native | USD / USD |
| 2021 | 50.0x | Annual | Native | USD / USD |
P/E uses historical market capitalization and earnings known at each period. Cross-currency observations are normalized to USD using point-in-time FX rates.
Profitability and margins
Profitability showcases the company's legendary pricing power across commodity cycles. Gross margins reached 48.9% in fiscal 2025 and exceeded 49% in mid-2026 as price increases counteracted rising raw material expenses. The core Paint Stores network demonstrated that professional painters accept higher prices because paint represents only a small fraction of their total project billing. Historically, price increases remain permanent even after chemical and resin prices drop, creating a powerful margin ratchet over time. While recent surges in crude oil over $100 per barrel create short-term cost pressure, the company's ability to protect unit profits ensures operating margins will expand rapidly once energy prices stabilize.
The table compares up to five fiscal years of operating income and reported profitability margins.
| Fiscal year | Operating income | Operating margin | Net margin |
|---|---|---|---|
| 2025 | USD 3.8B | 16.1% | 10.9% |
| 2024 | USD 3.8B | 16.3% | 11.6% |
| 2023 | USD 3.7B | 16.0% | 10.4% |
| 2022 | USD 3B | 13.5% | 9.1% |
| 2021 | USD 2.7B | 13.4% | 9.3% |
Balance sheet and leverage
The balance sheet is deliberately structured with high financial leverage to maximize returns on equity. Total debt stands near $12.9 billion, resulting in a debt-to-equity ratio of 2.81 following past acquisitions and regular stock buybacks. Headline liquidity appears lean, as the business operates with minimal idle cash reserves. Despite significant debt, the company faces very low financial distress risk because operating earnings cover interest payments more than eight times over. Generating over $3.2 billion in annual free cash flow allows management to comfortably manage debt maturities, though elevated interest rates make future large debt-funded acquisitions less likely.
The table compares up to five fiscal years of debt, liquidity, net cash or debt, and current-ratio evidence.
| Fiscal year | Total debt | Cash + short-term investments | Reported net cash / (debt) | Debt less (cash + short-term investments), calculated | Current ratio |
|---|---|---|---|---|---|
| 2025 | USD 12.9B | USD 207.2M | USD 12.7B net debt | USD 12.7B | 0.87x |
| 2024 | USD 11.9B | USD 210.4M | USD 11.7B net debt | USD 11.7B | 0.79x |
| 2023 | USD 11.8B | USD 276.8M | USD 11.5B net debt | USD 11.5B | 0.83x |
| 2022 | USD 12.5B | USD 198.8M | USD 12.3B net debt | USD 12.3B | 0.99x |
| 2021 | USD 11.5B | USD 165.7M | USD 11.3B net debt | USD 11.3B | 0.88x |
Reported net debt retains the source definition, which can deduct cash alone. Cash plus short-term investments is broader liquidity; the separately calculated column subtracts that full amount from total debt for the same fiscal period and currency. Reported net debt below zero is displayed as net cash. Current ratio is current assets divided by current liabilities.
Capex and investment intensity
Capital spending is experiencing a major turning point after several years of heavy investment. Spending absorbed 3.38% of revenue in fiscal 2025 as the company finished building its new global headquarters and research center in Ohio. Completing these landmark facilities allows annual capital spending to retreat toward its historical baseline near 2% of sales. This spending reduction unlocks hundreds of millions of dollars in spare cash that was previously tied up in construction. Rather than building unnecessary factory capacity, management is redirecting this liberated liquidity toward regular store openings, technological tools for contractors, and steady share repurchases that directly enhance value for shareholders.
The table compares up to five fiscal years of capital expenditure and research-and-development investment.
| Fiscal year | Capital expenditure | R&D spend |
|---|---|---|
| 2025 | USD 797.6M | -- |
| 2024 | USD 1.1B | -- |
| 2023 | USD 888.4M | USD 196.6M |
| 2022 | USD 644.5M | USD 119.3M |
| 2021 | USD 372M | USD 115.9M |
Behind the synthesisThe Sherwin-Williams: How Each Individual AI Forecaster Opinion Shapes the Global Consensus
This publication’s recorded synthesis allocated voting influence across 14 advisor opinions. The weights and rationales below are retained from that synthesis.
The independently supported consensus pattern establishes that captive direct-store distribution and permanent pricing power insulate gross profitability against input cost inflation, while the completion of major headquarters construction triggers a decisive free cash flow inflection above three billion dollars annually. Correlated assumptions across bullish views anchor on an immediate housing turnover recovery and persistent thirty-times earnings multiples, which lack macro verification under five-percent Treasury yields. Conversely, the strongest credible contrarian case correctly identifies that negative equity risk premia must compress valuation multiples toward historical industrial norms near twenty-two to twenty-four times. Materially unsupported claims of rapid double-digit architectural volume expansion are downweighted given stagnant existing home sales near generational lows. Pacing of petrochemical feedstock deflation and mortgage rate normalization remains an unresolved uncertainty. Relative weights prioritize reports utilizing verified SEC filings and balanced valuation models over unhedged momentum.
All 14 opinions
Universal Investor AI
The Polymath
OpenAI GPT-6 Astra · 2026-09-03 releaseWeight: 12.0%
Exemplary evidence quality grounded in primary SEC filings, verifying capital expenditure targets, working capital dynamics, and segment margin divergence. The valuation bridge between GAAP earnings and normalized multiples is exceptionally thorough, justifying a top relative weighting.
Universal Investor AI
The Polymath
Anthropic Claude Opus 5 · 2026-07-24 releaseWeight: 12.0%
Outstanding evidence quality backed by verified SEC filings, industry pricing announcements, and housing telemetry. The analysis elegantly connects the asymmetric pricing ratchet to post-headquarters free cash flow conversion, delivering an exceptionally coherent investment synthesis.
Michael Burry AI
The Vulture
Google Gemini 3.8 Flash · 2026-09-02 releaseWeight: 8.0%
Provides rigorous analysis of petrochemical cost inflation and valuation multiple sensitivity against five-percent Treasury yields. The causal mechanism linking frozen housing turnover to volume stagnation is well supported, though the path slightly underestimates cash flow durability from capital expenditure roll-offs.
J.P. Morgan AI
The Titan
Google Gemini 3.8 Flash · 2026-09-02 releaseWeight: 8.0%
Supplies robust analysis of the captive store network chokepoint and non-residential protective coatings growth. The compounding thesis driven by share repurchases is well supported, though its terminal multiple assumptions slightly discount duration risk.
Warren Buffett AI
The Value Seeker
Google Gemini 3.8 Flash · 2026-09-02 releaseWeight: 8.0%
Combines thorough primary research on completed research facilities with disciplined owner-earnings valuation. The thesis realistically models mid-single-digit volume growth alongside multiple contraction toward twenty-three times earnings, providing high analytical utility and grounded projections.
Sherlock Holmes AI
The Whistleblower
Google Gemini 3.8 Flash · 2026-09-02 releaseWeight: 7.0%
Features strong forensic statement analysis identifying the structural free cash flow inflection resulting from corporate headquarters capital expenditure roll-off. However, the thesis assumes an overly rapid multiple stabilization that partially understates persistent sovereign yield competition.
Universal Investor AI
The Polymath
Google Gemini 3.8 Flash · 2026-09-02 releaseWeight: 7.0%
Demonstrates high causal consistency regarding pro contractor loyalty and ongoing market share acquisition from independent dealers. The operational argument for free cash flow compounding is compelling, though projected five-year price appreciation leans somewhat optimistic.
Niccolo Machiavelli AI
The Insider
Google Gemini 3.8 Flash · 2026-09-02 releaseWeight: 7.0%
Presents an incisive operational breakdown of contractor price insensitivity, noting that labor dominates painting invoices. While the analysis of distribution power is causally sound, it assumes somewhat aggressive near-term multiple resilience in an elevated interest-rate environment.
Universal Investor AI
The Polymath
Google Gemini 3.8 Flash · 2026-09-02 releaseWeight: 7.0%
Offers strong causal reasoning on peak cyclical margin risk and valuation multiple contraction against sovereign yields. The report soundly highlights balance sheet leverage constraints, though it somewhat underweights the defensive stability of recurring repaint maintenance.
Ray Dalio AI
The Strategist
Google Gemini 3.8 Flash · 2026-09-02 releaseWeight: 6.0%
Delivers a balanced macroeconomic framework evaluating monetary tightening headwinds against captive store pricing power. The analysis accurately isolates housing turnover constraints, though its reliance on broad cycle abstractions slightly limits granular insight into specialty protective coatings momentum.
Warren Buffett AI
The Value Seeker
Google Gemini 3.8 Flash · 2026-09-02 releaseWeight: 5.0%
Accurately captures the wide economic moat and aging housing stock repaint tailwind, balanced by rigorous valuation discipline. While sound, its core arguments overlap substantially with other value framework reports, warranting a moderate standalone allocation.
Superintelligence AI
The Anthropologist
Google Gemini 3.8 Flash · 2026-09-02 releaseWeight: 5.0%
Provides a thoughtful thesis framing coatings as negentropic maintenance barriers, supported by solid capital expenditure roll-off analysis. The forecast path is credible, though its top-line volume growth assumptions remain somewhat elevated relative to housing market data.
Superintelligence AI
The Anthropologist
Google Gemini 3.8 Flash · 2026-09-02 releaseWeight: 4.0%
Presents a credible contrarian warning regarding multiple de-rating and debt service burdens under persistent rate tightening. However, the path overstates operational fragility by ignoring the captive store network's proven ability to defend gross cash generation.
Elon Musk AI
The Visionary
Google Gemini 3.8 Flash · 2026-09-02 releaseWeight: 4.0%
Constructs a sharp critique of negative equity risk premia and housing turnover lock-in, correctly highlighting valuation gravity. Nevertheless, the report underestimates countercyclical protective coatings demand and post-capex cash release, keeping its relative weighting modest.
References & Context
Research Provenance
Analysis generated by iPulse AI Engine v7 using recorded market data, operating under the editorial standards and supervision of Russlan Ramdowar, Editor-in-Chief.
External references below are sources recorded by the researcher agents for this The Sherwin-Williams forecast batch.
Primary analysis inputs
- iPulse AI Multi-Agent Forecasts — independent analyst personas, model outputs, and consensus synthesis.
- iPulse AI Global Events Context — macroeconomic, geopolitical, regulatory, and industry-event context.
- Structured market history — prices, distributions, volatility, identifiers, and listing metadata.
- Company earnings and financial statements — revenue, profitability, balance-sheet, cash-flow, and investment trends.
- Researcher web evidence — public sources consulted to challenge and contextualize the forecast thesis.
Independent AI Advisor panel
- AI Advisors
- 14
- AI Researchers
- 11
- AI Thinkers
- 3
Sources retained from AI Researcher searches
Asset-specific · Researcher web33 available sources from this batch (87 recorded). The first 15 are shown below; expand to read the rest.
- Federal Reserve Board - Federal Reserve issues FOMC statement federalreserve.gov
- Document sec.gov
- FINANCIAL CONDITION, LIQUIDITY AND CASH FLOW sec.gov
- SHERWIN WILLIAMS CO - Form 10-Q - FY2025 sec.gov
- shw-20260630 sec.gov
- Sherwin-Williams stock gains as KeyCorp outlines 2026 earnings and guidance ad-hoc-news.de
- Sherwin-Williams stock gains support from solid Q2 2026 figures and guidance ad-hoc-news.de
- Sherwin-Williams stock holds firm as valuation debate intensifies ad-hoc-news.de
- Sherwin-Williams stock holds steady as Q2 2026 earnings beat and guidance raise support valuation ad-hoc-news.de
- Raw material markets under pressure - European Coatings european-coatings.com
- The Sherwin-Williams Company Q2 2026 Earnings Call Summary finance.yahoo.com
- Global Pigment & Coatings Industry Monthly Brief – June 2026 finelandchem.com
- Housing starts outlook turns negative through 2027 as costs rise housingwire.com
- PPG expects favorable raw material prices through 2026 - execs | ICIS icis.com
- valPure® Epoxy Coatings | Sherwin-Williams industrial.sherwin-williams.com
Show 18 more sources
- Sherwin-Williams Q2 2026 slides: earnings beat, guidance raised By Investing.com investing.com
- PPG - PPG announces global price increase of up to 20% already in progress investor.ppg.com
- Sherwin-Williams - Investor Relations investors.sherwin-williams.com
- Sherwin-Williams - Nippon Paint Group and Sherwin-Williams End Pursuit of AkzoNobel investors.sherwin-williams.com
- Sherwin-Williams - Sherwin-Williams Completes Acquisition of BASF's Brazilian Architectural Paints Business investors.sherwin-williams.com
- Sherwin-Williams - The Sherwin-Williams Company Reports 2026 Second Quarter Financial Results investors.sherwin-williams.com
- Sherwin-Williams - The Sherwin-Williams Company Reports 2026 Second Quarter Financial Results investors.sherwin-williams.com
- March 16, 2026 - 425: Prospectuses and communications, business combinations | Axalta Coating Systems Ltd. (AXTA) ir.axalta.com
- SHW: The Sherwin-Williams Company Stock Price, Chart & Key Stats | LuxAlgo luxalgo.com
- Existing-Home Sales nar.realtor
- Sherwin-Williams Completes Acquisition of Suvinil — American Coatings Association paint.org
- US Existing Home Sales Hit 14-Month Low as Mortgage Rates Climb planet-today.com
- The Sherwin-Williams Company (SHW) Investor Relations, Earnings Summary & Outlook quartr.com
- PowerPoint Presentation s2.q4cdn.com
- The Sherwin-Williams Company (SHW) Stock Forecast & Price Targets stockanalysis.com
- Sherwin-Williams posts strong Q2 2026 results | SHW 8-K Filing stocktitan.net
- SHW Stock Forecast 2026 - Sherwin-Williams Price Targets & Predictions tickernerd.com
- United States Housing Starts tradingeconomics.com
54 additional sources are recorded in this batch; their citation details are not available in this publication.
Context retained with this Consensus
The same public-safe market, global-event, and fundamental context supplied to the AI Advisor panel.
Global context snapshot
2025 Full-Year Global Market and World-Events Context
Download Archived SnapshotCoverage 2025-01-01 to 2025-12-31 · Knowledge cutoff 2025-12-31
This full-year context package covers the principal geopolitical, economic, monetary-policy, technology, trade, energy, and institutional developments that shaped global markets during 2025. It gives the forecasting model a chronological account of major world events together with their likely transmission into growth, inflation, interest rates, supply chains, commodities, currencies, public markets, and sector-level investment conditions.
Archived context covering 2025-01-01 to 2025-12-31. Its recorded scope includes technology and capital cycle; trade and industrial policy; monetary policy. Selected highlights reflect the analysis cutoff, not current world conditions.
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- File size
- 90.8K bytes
- Words
- 13.3K words
- Characters
- 90.8K characters
- Est. tokens (characters ÷ 4)
- 22.7K tokens
The package also includes monthly and quarterly macroeconomic and cross-asset reference tables spanning US and international growth, central-bank policy, sovereign yields, major equity indices, foreign exchange, energy, industrial and precious metals, and digital assets. Quarterly and full-year high-impact summaries are integrated; monthly quantitative series remain working values pending final audit, and that qualification is part of the preserved context.
| Selected highlights from this archived snapshot | Date | Status |
|---|---|---|
| DeepSeek shock and AI economics reset | 2025-01-27 | OPEN ENDED TREND |
| US tariff regime escalation and trade-system rupture | 2025-02-01 | ACTIVE POLICY REGIME |
| Federal Reserve easing cycle after a prolonged hold | 2025-09-17 | ACTIVE POLICY REGIME |
Representative Sources of the Context File
And more sources from the retained context package.
2026 Year-to-Date Global Market and World-Events Context Through September 20
Download Archived SnapshotCoverage 2026-01-01 to 2026-09-20 · Knowledge cutoff 2026-09-20
January 1-September 20, 2026: monetary tightening, energy security, trade restrictions, AI financing and divergent growth; five leading market themes.
Archived context covering 2026-01-01 to 2026-09-20. Its recorded scope includes monetary policy and rates; geopolitics energy and shipping; trade and industrial policy. Selected highlights reflect the analysis cutoff, not current world conditions.
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- File size
- 84.8K bytes
- Words
- 12.4K words
- Characters
- 84.8K characters
- Est. tokens (characters ÷ 4)
- 21.2K tokens
Fed raised rates to 3.75%-4.00%; ECB hike is in force and BOJ increase starts September 24. Markets through September 18, bitcoin through September 19.
| Selected highlights from this archived snapshot | Date | Status |
|---|---|---|
| Renewed monetary tightening amid persistent inflation | 2026-01-30 | ACTIVE POLICY REGIME |
| Iran/Hormuz conflict and wider energy-security disruption | 2026-02-28 | ONGOING |
| Tariff legal reset and strategic supply restrictions | 2026-02-20 | ACTIVE POLICY REGIME |
Representative Sources of the Context File
And more sources from the retained context package.
Fundamental Context Passed as Input to the Models
Time range: Annual fiscal periods: 2014-12-31–2025-12-31, 12 periods; Quarterly fiscal periods: 2023-09-30–2026-06-30, 12 periods.
Currencies cited: USD (quote USD; primary reporting USD; converted/valuation USD).
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Income statement
9 fieldsdepreciationAndAmortization · ebit · ebitda · grossProfit · +5 more fields
Balance sheet
12 fieldscash · commonStockSharesOutstanding · longTermDebt · netDebt · +8 more fields
Cash flow
5 fieldscapitalExpenditures · dividendsPaid · freeCashFlow · salePurchaseOfStock · +1 more field
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