Back to top

Image: Bigstock

Stanley Black Gears Up to Report Q4 Earnings: What's in the Offing?

Read MoreHide Full Article

Key Takeaways

  • SWK is set to report Q4 results on Feb. 4, with revenues seen up 1.1% to $3.76B and adjusted EPS at $1.27.
  • Stanley Black's Tools & Outdoor and Engineered Fastening units are expected to post 1% and 1.9% growth.
  • SWK faces high costs, supply-chain issues and labor shortages, though cost cuts may aid margins.

Stanley Black & Decker, Inc. (SWK - Free Report) is scheduled to release fourth-quarter 2025 results on Feb. 4, before market open.

The Zacks Consensus Estimate for this New Britain, CT-based tool maker’s fourth-quarter revenues is pegged at $3.76 billion, indicating growth of 1.1% from the year-ago quarter. The consensus estimate for adjusted earnings is pinned at $1.27 per share. The figure indicates a decline of 14.8% from the year-ago quarter’s number.

The consensus estimate for earnings has been stable over the past 60 days. The company has an impressive earnings surprise history, having outperformed the consensus estimate in each of the preceding four quarters, the average surprise being 57.8%.

Let’s see how things have shaped up for Stanley Black before the announcement.

Factors Likely to Have Shaped SWK’s Quarterly Performance

Stanley Black’s Tools & Outdoor segment’s results are expected to benefit from the solid momentum in its DEWALT business and recovery in demand for outdoor products. However, persistent softness in the DIY market and depressing demand for hand tools remain concerning. We expect the Tools & Outdoor segment’s revenues to increase 1% year over year to $3.26 billion.

Despite softness, strength in the aerospace market and signs of recovery in the automotive market are expected to have aided the Engineered Fastening segment’s fourth-quarter performance. However, weakness in the general industrial market and the divestiture of the infrastructure business are likely to weigh on the segment’s top-line results. We expect the Engineered Fastening segment’s revenues to grow 1.9% year over year to $502 million.

However, over time, Stanley Black has been incurring high costs and operating expenses, which are likely to have weighed on its performance. Also, supply-chain challenges and labor shortages, especially in the aerospace market, are likely to affect its results in the fourth quarter.

Nevertheless, SWK’s cost-reduction program is likely to have supported its bottom line in the to-be-reported quarter. The company is expected to have put up a healthy margin performance, aided by supply-chain transformation and inventory reduction efforts.

Earnings Whisper

Our proven model does not conclusively predict an earnings beat for Stanley Black this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is not the case here, as elaborated below.

Earnings ESP: Stanley Black has an Earnings ESP of -1.56% as the Most Accurate Estimate is pegged at $1.25 per share, which is lower than the Zacks Consensus Estimate of $1.27. You can uncover the best stocks before they’re reported with our Earnings ESP Filter.

Zacks Rank: SWK presently carries a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Stocks With the Favorable Combination

Here are three companies, which according to our model, have the right combination of elements to post an earnings beat this season.

Ingersoll Rand (IR - Free Report) has an Earnings ESP of +0.82% and a Zacks Rank of 3 at present. The company is slated to release fourth-quarter 2025 results on Feb. 12.

Ingersoll Rand’s earnings matched the Zacks Consensus Estimate thrice and missed once in the trailing four quarters, the average surprise being a negative 0.34%.

Allegion plc (ALLE - Free Report) has an Earnings ESP of +0.21% and a Zacks Rank of 3 at present. The company is scheduled to release fourth-quarter 2025 results on Feb. 17.

Allegion’s earnings surpassed the Zacks Consensus Estimate in each of the preceding four quarters, the average surprise being 5.9%.

Watts Water Technologies (WTS - Free Report) has an Earnings ESP of +0.59% and a Zacks Rank of 2 at present. The company is slated to release second-quarter fiscal 2026 results on Feb. 11.

Watts Water’s earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 10.9%.

Published in