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Sherwin-Williams (SHW) Stock Sinks As Market Gains: What You Should Know

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In the latest trading session, Sherwin-Williams (SHW - Free Report) closed at $228.99, marking a -0.21% move from the previous day. This move lagged the S&P 500's daily gain of 1.46%. At the same time, the Dow added 1%, and the tech-heavy Nasdaq lost 0.18%.

Heading into today, shares of the paint and coatings maker had lost 14.77% over the past month, lagging the Construction sector's loss of 8.03% and the S&P 500's loss of 6.94% in that time.

Wall Street will be looking for positivity from Sherwin-Williams as it approaches its next earnings report date. This is expected to be July 27, 2022. On that day, Sherwin-Williams is projected to report earnings of $2.78 per share, which would represent year-over-year growth of 4.91%. Our most recent consensus estimate is calling for quarterly revenue of $6 billion, up 11.46% from the year-ago period.

SHW's full-year Zacks Consensus Estimates are calling for earnings of $9.48 per share and revenue of $21.88 billion. These results would represent year-over-year changes of +16.32% and +9.68%, respectively.

Any recent changes to analyst estimates for Sherwin-Williams should also be noted by investors. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. Sherwin-Williams is currently sporting a Zacks Rank of #3 (Hold).

Looking at its valuation, Sherwin-Williams is holding a Forward P/E ratio of 24.21. This represents a premium compared to its industry's average Forward P/E of 21.22.

We can also see that SHW currently has a PEG ratio of 1.84. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Paints and Related Products industry currently had an average PEG ratio of 2.69 as of yesterday's close.

The Paints and Related Products industry is part of the Construction sector. This industry currently has a Zacks Industry Rank of 104, which puts it in the top 42% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

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