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Investing.com - Jefferies maintained its Hold rating and $370.00 price target on Sherwin-Williams (NYSE:SHW) stock Wednesday, citing persistent weak demand in the paint and coatings sector. The $89.85 billion market cap company currently trades at a P/E ratio of 35.3x, which according to InvestingPro analysis, suggests the stock is trading above its Fair Value.
The research firm noted that current market conditions remain challenging for Sherwin-Williams, with consumer demand showing little sign of immediate improvement across its key segments.
Jefferies indicated that a meaningful recovery would likely require more than 75 basis points of additional interest rate cuts and a significant boost in consumer confidence metrics.
The firm expressed concern about consensus estimates for 2026 and 2027, suggesting they may trend lower following third-quarter results unless mortgage rates ease rapidly.
Despite the near-term challenges, Jefferies acknowledged that Sherwin-Williams continues to gain market share and make strategic investments to strengthen its competitive position, which could provide enhanced leverage during the next recovery cycle. The company maintains strong fundamentals with a 48.87% gross margin and has demonstrated commitment to shareholder returns, having raised its dividend for 32 consecutive years.
In other recent news, Sherwin-Williams has faced a series of analyst assessments following its latest financial results. The company reported second-quarter adjusted earnings per share of $3.38, which did not meet Mizuho’s estimate of $3.85 or the consensus forecast of $3.81. Additionally, same-store sales showed a modest increase of 0.8% year-over-year. BMO Capital lowered its price target for Sherwin-Williams to $391, citing a notable earnings per share miss and a reduction in guidance, though it maintained an Outperform rating. Similarly, Mizuho adjusted its price target to $385 from $400, also due to weaker-than-expected results and reduced full-year guidance.
Despite these challenges, UBS reiterated a Buy rating with a price target of $395, following discussions with Sherwin-Williams’ management. RBC Capital also maintained an Outperform rating and set a price target of $400 after engaging with company executives. Meanwhile, KeyBanc maintained a Sector Weight rating, noting softer demand in the U.S. construction and industrial markets and adjusting its 2025 earnings per share estimate downward by 4%. These developments highlight a mixed outlook for Sherwin-Williams, with various analyst firms providing differing perspectives on the company’s future performance.
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