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Stanley Black's Q2 Earnings Beat Estimates, Revenues Down Y/Y
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Key Takeaways
SWK posted Q2 adjusted EPS of $1.08, beating estimates but down 0.9% year over year on weaker sales.
Tools and Outdoor and Engineered Fastening revenues declined 1.9% and 2.4% year over year, respectively.
Free cash flow fell to -$350.3M, while EBITDA margin dropped 260 bps to 8.1% amid rising SGnA costs.
Stanley Black & Decker, Inc. (SWK - Free Report) reported second-quarter 2025 adjusted earnings of $1.08 per share, which beat the Zacks Consensus Estimate of 38 cents. The bottom line inched down 0.9% year over year.
Stanley Black’s net sales of $3.95 billion missed the consensus estimate of $3.99 billion. The top line declined 2% year over year due to weakness in both segments.
Stanley Black’s Segmental Discussion
Effective from the first quarter of 2025, SWK has renamed the Industrial segment as the Engineered Fastening segment. It had no impact on the company's consolidated financial statements or segment results.
Revenues from the company’s primary segment, Tools & Outdoor, totaled $3.46 billion, which decreased 1.9% year over year.
Revenues from the Engineered Fastening segment grossed $483.8 million, down 2.4% year over year.
Stanley Black & Decker, Inc. Price, Consensus and EPS Surprise
Stanley Black’s cost of sales inched down 0.2% year over year to $2.88 billion. The gross profit decreased 6.5% year over year to $1.07 billion. The gross margin decreased 140 basis points (bps) year over year to 27%.
Selling, general and administrative expenses increased 5.4% year over year to $873.1 million. Adjusted EBITDA was $318.2 million, indicating a year-over-year decline of 25.9%. The margin decreased 260 bps to 8.1%.
SWK’s Balance Sheet and Cash Flow
While exiting the second quarter, Stanley Black had cash and cash equivalents of $311.8 million compared with $290.5 million at the end of fourth-quarter 2024. The long-term debt balance was $4.76 billion, lower than $5.6 billion reported at the end of fourth-quarter 2024.
In the first six months of 2025, net cash used in operating activities was $205.7 million against $142 million generated in the year-ago period. Capital and software expenditures totaled $144.6 million, down from $152.9 million reported in the year-ago period. Free cash flow (before dividends) was a negative $350.3 million compared with $10.9 million a year ago.
In the first six months, SWK paid out dividends worth $248.5 million to its shareholders, up 2% from the year-ago period.
SWK’s 2025 Guidance
Stanley Black expects total revenues to be in the range of (1%)-flat on a year-over-year basis. The company anticipates earnings to be $3.45 (+/- $0.10) per share compared with $3.30 (+/- $0.15) expected earlier. Adjusted earnings are projected to be $4.65 per share. The company targets to generate annual free cash flow (non-GAAP) of approximately $600 million.
Flowserve Corporation (FLS - Free Report) presently sports a Zacks Rank of 1. FLS’ earnings surpassed the consensus estimate twice and missed on the other two occasions in the trailing four quarters. The average earnings surprise was 5.3%. In the past 60 days, the Zacks Consensus Estimate for Flowserve’s 2025 earnings has increased 0.6%.
ITT Inc. (ITT - Free Report) currently carries a Zacks Rank #2 (Buy). ITT has an impressive earnings surprise history, having outperformed the consensus estimate in each of the preceding four quarters, the average surprise being 1.7%. In the past 60 days, the Zacks Consensus Estimate for ITT’s 2025 earnings has increased 0.9%.
IDEX Corporation (IEX - Free Report) currently carries a Zacks Rank of 2. IEX has an impressive earnings surprise history, having outperformed the consensus estimate in each of the preceding four quarters, with an average surprise of 2.2%. In the past 60 days, the Zacks Consensus Estimate for IDEX’s 2025 earnings has inched up 0.4%.
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Stanley Black's Q2 Earnings Beat Estimates, Revenues Down Y/Y
Key Takeaways
Stanley Black & Decker, Inc. (SWK - Free Report) reported second-quarter 2025 adjusted earnings of $1.08 per share, which beat the Zacks Consensus Estimate of 38 cents. The bottom line inched down 0.9% year over year.
Stanley Black’s net sales of $3.95 billion missed the consensus estimate of $3.99 billion. The top line declined 2% year over year due to weakness in both segments.
Stanley Black’s Segmental Discussion
Effective from the first quarter of 2025, SWK has renamed the Industrial segment as the Engineered Fastening segment. It had no impact on the company's consolidated financial statements or segment results.
Revenues from the company’s primary segment, Tools & Outdoor, totaled $3.46 billion, which decreased 1.9% year over year.
Revenues from the Engineered Fastening segment grossed $483.8 million, down 2.4% year over year.
Stanley Black & Decker, Inc. Price, Consensus and EPS Surprise
Stanley Black & Decker, Inc. price-consensus-eps-surprise-chart | Stanley Black & Decker, Inc. Quote
SWK’s Margin Profile
Stanley Black’s cost of sales inched down 0.2% year over year to $2.88 billion. The gross profit decreased 6.5% year over year to $1.07 billion. The gross margin decreased 140 basis points (bps) year over year to 27%.
Selling, general and administrative expenses increased 5.4% year over year to $873.1 million. Adjusted EBITDA was $318.2 million, indicating a year-over-year decline of 25.9%. The margin decreased 260 bps to 8.1%.
SWK’s Balance Sheet and Cash Flow
While exiting the second quarter, Stanley Black had cash and cash equivalents of $311.8 million compared with $290.5 million at the end of fourth-quarter 2024. The long-term debt balance was $4.76 billion, lower than $5.6 billion reported at the end of fourth-quarter 2024.
In the first six months of 2025, net cash used in operating activities was $205.7 million against $142 million generated in the year-ago period. Capital and software expenditures totaled $144.6 million, down from $152.9 million reported in the year-ago period. Free cash flow (before dividends) was a negative $350.3 million compared with $10.9 million a year ago.
In the first six months, SWK paid out dividends worth $248.5 million to its shareholders, up 2% from the year-ago period.
SWK’s 2025 Guidance
Stanley Black expects total revenues to be in the range of (1%)-flat on a year-over-year basis. The company anticipates earnings to be $3.45 (+/- $0.10) per share compared with $3.30 (+/- $0.15) expected earlier. Adjusted earnings are projected to be $4.65 per share. The company targets to generate annual free cash flow (non-GAAP) of approximately $600 million.
SWK’s Zacks Rank and Key Picks
SWK currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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Flowserve Corporation (FLS - Free Report) presently sports a Zacks Rank of 1. FLS’ earnings surpassed the consensus estimate twice and missed on the other two occasions in the trailing four quarters. The average earnings surprise was 5.3%. In the past 60 days, the Zacks Consensus Estimate for Flowserve’s 2025 earnings has increased 0.6%.
ITT Inc. (ITT - Free Report) currently carries a Zacks Rank #2 (Buy). ITT has an impressive earnings surprise history, having outperformed the consensus estimate in each of the preceding four quarters, the average surprise being 1.7%. In the past 60 days, the Zacks Consensus Estimate for ITT’s 2025 earnings has increased 0.9%.
IDEX Corporation (IEX - Free Report) currently carries a Zacks Rank of 2. IEX has an impressive earnings surprise history, having outperformed the consensus estimate in each of the preceding four quarters, with an average surprise of 2.2%. In the past 60 days, the Zacks Consensus Estimate for IDEX’s 2025 earnings has inched up 0.4%.