Sherwin Williams Posts Mixed Q2 Results, Updates Q3 and FY25 Outlooks

Sherwin Williams reported Q2 non-GAAP EPS of $3.38, missing estimates by $0.43. Revenue was $6.31B, beating estimates by $20M. The company generated $1.05 billion in net operating cash and returned $1.27 billion to shareholders. Sherwin Williams initiated Q3 and updated FY25 outlook.

Sherwin-Williams (SHW) reported its Q2 non-GAAP earnings per share (EPS) of $3.38, missing estimates by $0.43. Revenue was $6.31 billion, beating estimates by $20 million. The company generated $1.05 billion in net operating cash and returned $1.27 billion to shareholders. Sherwin-Williams initiated Q3 and updated its FY25 outlook [1].

Financial Performance

The company reported a non-GAAP EPS of $3.38, which was $0.43 lower than the estimated $3.81. Revenue of $6.31 billion exceeded expectations by $20 million. This marks a significant deviation from the consensus estimates, indicating a mixed performance for the quarter [1].

Operational Highlights

Net operating cash flow (NOCF) stood at $1.05 billion, while the company returned $1.27 billion to shareholders through dividends and share buybacks. This demonstrates a strong commitment to shareholder value and cash flow management [1].

Analyst Reactions

Analysts have mixed reactions to the Q2 results. Among the 29 analysts covering SHW, 16 have a "strong buy" or "buy" rating, 11 are "hold," and 2 have a "sell" rating. The median price target of $400 remains unchanged from a month ago, with BMO reducing its target to $405 from $410 [1].

Future Outlook

SHW initiated Q3 and updated its FY25 outlook. The company's guidance and future projections will be closely watched by investors for any signs of improved performance or potential risks. The housing market's impact on the company's top-line growth remains a key concern [1].

Peer Comparison

Comparatively, SHW ranks at the top for revenue growth and gross profit among its peers. It is in the middle for return on equity. Ecolab, DuPont de Nemours, and PPG Indus have different analyst ratings and average 1-year price targets, suggesting varied market expectations [2].

Market Performance

SHW shares have been trading at $340.07 as of July 18, with a 1.06% decline over the last 52 weeks. The stock's YTD performance is up ~0.9% compared to the ~4.2% rise in the Dow Industrials (DJI). Options analytics service ORATS indicates a 4.0% swing for the shares, aligning with the stock's average post-earnings move over the last 12 quarters [1].

Conclusion

Sherwin-Williams' Q2 results were mixed, with EPS and revenue deviating from expectations. The company's strong cash flow and shareholder returns are positive aspects. The housing market's impact on the company's top-line growth remains a critical factor to monitor. Investors will closely watch the company's updated outlook and future earnings announcements for further insights.

References

[1] https://www.tradingview.com/news/reuters.com,2025:newsml_L6N3TI0LM:0-preview-sherwin-williams-eps-revenue-seen-edging-higher-in-q2/
[2] https://www.benzinga.com/insights/earnings/25/07/46519870/a-preview-of-sherwin-williamss-earnings