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

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Sherwin-Williams (SHW - Free Report) closed the most recent trading day at $225.41, moving +0.94% from the previous trading session. The stock outpaced the S&P 500's daily loss of 0.07%. Meanwhile, the Dow gained 0.27%, and the Nasdaq, a tech-heavy index, added 0.02%.

Prior to today's trading, shares of the paint and coatings maker had lost 16.69% over the past month. This has lagged the Construction sector's loss of 13.51% and the S&P 500's loss of 7.99% in that time.

Sherwin-Williams will be looking to display strength as it nears its next earnings release, which is expected to be July 27, 2022. In that report, analysts expect Sherwin-Williams to post earnings of $2.78 per share. This would mark year-over-year growth of 4.91%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $6 billion, up 11.46% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $9.48 per share and revenue of $21.88 billion, which would represent changes of +16.32% and +9.68%, respectively, from the prior year.

It is also important to note the recent changes to analyst estimates for Sherwin-Williams. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. Sherwin-Williams is currently sporting a Zacks Rank of #3 (Hold).

In terms of valuation, Sherwin-Williams is currently trading at a Forward P/E ratio of 23.56. This represents a premium compared to its industry's average Forward P/E of 21.09.

Meanwhile, SHW's PEG ratio is currently 1.79. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Paints and Related Products was holding an average PEG ratio of 2.7 at yesterday's closing price.

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

The Zacks Industry Rank gauges the strength of our 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.

Make sure to utilize to follow all of these stock-moving metrics, and more, in the coming trading sessions.

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