Will SHW's 2025 earnings rebound from 2024 levels?

The Sherwin-Williams Company (NYSE: SHW) is poised for a rebound in its 2025 earnings, considering both the analyst estimates and the company's guidance. Here's a detailed analysis:

1. Analyst Estimates and Company Guidance:
   • KeyCorp's Q1 2025 EPS estimate is $2.31, which is slightly above the 2024 Q1 EPS of $2.31.
   • The consensus estimate for Sherwin-Williams' full-year 2025 EPS is $11.65-$12.05, indicating a range that, if met, would represent a rebound from the 2024 EPS of $11.47.
   • Revenue guidance for 2025 has not been provided, but the company's historical revenue growth and the slight variance from the consensus estimate in the most recent quarter suggest a positive outlook.

2. Historical Performance and Trends:
   • Sherwin-Williams has demonstrated a net margin of 10.92% and a return on equity of 75.58%, indicating strong profitability and efficiency.
   • The company's revenue has shown a positive trend, with a 0.5% increase year-over-year in the latest reported quarter.
   • Despite missing the consensus estimate in the most recent quarter, Sherwin-Williams reported a higher EPS than expected, which is a positive sign.
3. Market Sentiment and Analyst Ratings:
   • KeyCorp, Royal Bank of Canada, and Morgan Stanley have given Sherwin-Williams a "Sector Weight," "Outperform," and "Overweight" ratings, respectively, indicating a positive long-term outlook.
   • While there are some neutral and underperform ratings from analysts like UBS Group and Seaport Res Ptn, the overall sentiment is positive, with an average rating of "Moderate Buy" and an average price target of $400.65.
4. Potential Challenges and Considerations:
   • Seaport Res Ptn has a more cautious outlook, lowering its FY2024 earnings estimates, which suggests that Sherwin-Williams may face some challenges in the short term.
   • The expected decline in Q4 2024 earnings compared to Q3 2024 suggests that the company may be experiencing a seasonal fluctuation or specific industry challenges.

In conclusion, while Sherwin-Williams may face some short-term challenges, the analyst estimates and company guidance for 2025 suggest a rebound in earnings from the 2024 levels. The company's strong historical performance, profitability, and positive market sentiment support this view. However, investors should monitor the company's performance closely, especially in light of any potential industry-specific challenges or seasonal fluctuations.