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Sherwin-Williams (SHW) Inks Deal to Buy Gross & Perthun GmbH

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The Sherwin-Williams Company (SHW - Free Report) agreed to acquire Gross & Perthun GmbH. The latter is a developer, producer and distributor of coatings mainly for the heavy equipment and transportation industries based in Mannheim, Germany.

The acquired business has around 100 employees and roughly $50 million in annual sales. It is expected to become part of the Sherwin-Williams Performance Coatings Group segment. The deal is anticipated to close by the end of the third quarter of 2022.

Sherwin-Williams stated that this high-quality business brings innovative waterborne and solvent liquid coatings technology, leading specification and approval positions, strong relationships with multi-national and local customers, strategically located production and an excellent commercial and technical team focused on delivering innovative and value-added solutions. The combination of its businesses provides multiple opportunities to boost profitable growth throughout Europe and beyond.

Shares of Sherwin-Williams have declined 5.4% in the past year compared with a 4% decline of the industry.

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Sherwin-Williams, on Apr 1, 2022, completed the acquisition of the European industrial coatings business of Sika AG. The company noted that the acquisition is in sync with its strategy of taking over premium, complementary and differentiated businesses that have the potential to contribute to its growth momentum. The acquired business provides unique technology, an efficient sales and marketing team, strategic manufacturing locations and adds to scale.

The company, in its last earnings call, stated that it expects consolidated net sales to increase low-double digit to mid teens percentage year over year in the second quarter. For 2022, net sales are expected to increase high-single digit to low-double digit percentage. The company also expects adjusted earnings per share for 2022 to be between $9.25 and $9.65.

 

Zacks Rank & Key Picks

Sherwin-Williams currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the basic materials space are Allegheny Technologies Inc. (ATI - Free Report) , Nutrien Ltd. (NTR - Free Report) and The Chemours Company (CC - Free Report) .

Allegheny has a projected earnings growth rate of 953.9% for the current year. The Zacks Consensus Estimate for ATI's current-year earnings has been revised 31.7% upward in the past 60 days.

Allegheny’s earnings beat the Zacks Consensus Estimate in each of the last four quarters. It has a trailing four-quarter earnings surprise of roughly 128.9%, on average. ATI has gained around 7.8% in a year and currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Nutrien has a projected earnings growth rate of 169.7% for the current year. The Zacks Consensus Estimate for NTR’s current-year earnings has been revised 36.4% upward in the past 60 days.

Nutrien’s earnings beat the Zacks Consensus Estimate in three of the trailing four quarters, the average being 5.8%. NTR has gained 37.5% in a year. The company flaunts a Zacks Rank #1.

Chemours, currently sporting a Zacks Rank #1, has an expected earnings growth rate of 30.5% for the current year. The Zacks Consensus Estimate for CC's earnings for the current year has been revised 15.2% upward in the past 60 days.

Chemours’ earnings beat the Zacks Consensus Estimate in three of the trailing four quarters, the average being 28.7%. CC has gained around 12.6% over a year.
 


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