If You Invested $1000 in Sherwin-Williams 10 Years Ago, This Is How Much You'd Have Now
For most investors, how much a stock's price changes over time is important. Not only can it impact your investment portfolio, but it can also help you compare investment results across sectors and industries.
The fear of missing out, or FOMO, also plays a factor in investing, especially with particular tech giants, as well as popular consumer-facing stocks.
What if you'd invested in Sherwin-Williams (SHW) ten years ago? It may not have been easy to hold on to SHW for all that time, but if you did, how much would your investment be worth today?
Sherwin-Williams' Business In-Depth
With that in mind, let's take a look at Sherwin-Williams' main business drivers.
Founded in 1866 and headquartered in Cleveland, OH, The Sherwin-Williams Company is into manufacturing and sales of paints, coatings and related products, primarily in the North and South America. It also has operations in the Caribbean region, Europe and Asia. Sherwin-Williams is one of the biggest paint companies in the United States and in the world. Its well-known brands include Dutch Boy, Minwax and Krylon. The company, on Jun 1, 2017, completed the purchase of rival paints maker Valspar in an all-cash transaction, creating a premier global paints and coatings company.
Sherwin-Williams made changes to its reporting structure as a result of its acquisition of Valspar that led to the formation of three new reportable operating segments – The Americas Group, The Consumer Brands Group and The Performance Coatings Group. Earlier, the company had four operating segments – The Paint Stores Group, The Consumer Group, The Global Finishes Group and The Latin America Coatings Group.
The Americas Group: This segment includes the company’s earlier Paint Stores Group and Latin America Coatings Group. The group produces and sells a wide array of industrial coatings, architectural paint and related products across Latin America through dedicated dealers and company-operated stores. The segment accounted for around 56% of Sherwin-Williams’ 2021 sales.
The Consumer Brands Group: The division includes the company’s Consumer Group and Valspar's Consumer Paints segment, barring Valspar's Automotive Refinishes products business. The segment operates highly efficient supply chain for paints and coatings related products across the globe. The segment accounted for around 14% of Sherwin-Williams’ 2021 sales.
The Performance Coatings Group: The unit includes the company’s Global Finishes Group and Valspar's Coatings Group coupled with Valspar's Automotive Refinishes products business. It sells a wide array of industrial coatings and finishes for industrial wood, general industrial, protective and marine, packaging and automotive, coil and extrusion customers. The segment accounted for around 30% of Sherwin-Williams’ 2021 sales.
Bottom Line
Anyone can invest, but building a successful investment portfolio requires research, patience, and a little bit of risk. So, if you had invested in Sherwin-Williams ten years ago, you're likely feeling pretty good about your investment today.
A $1000 investment made in November 2012 would be worth $4,568.27, or a 356.83% gain, as of November 7, 2022, according to our calculations. Investors should note that this return excludes dividends but includes price increases.
In comparison, the S&P 500 gained 166.62% and the price of gold went up -6.02% over the same time frame.
Analysts are anticipating more upside for SHW.
Sherwin-Williams’ adjusted earnings and sales for the third quarter beat the respective Zacks Consensus Estimate. The company is expected to gain from the synergies of the Valspar acquisition and its operational- improvement actions. It is focused on growth through the expansion of operations. It is benefiting from strength in the Performance Coatings Group. Cost-control actions, working capital reductions, supply chain optimization and productivity improvement are also expected to support margins. However, supply-chain issues and higher labor costs are expected to hurt results in fourth-quarter 2022. The company also faces headwinds from higher input costs due to supply disruptions. It is exposed to challenges stemming from soft demand in Europe and China. A stretched valuation is another concern.
Shares have gained 5.17% over the past four weeks and there have been 4 higher earnings estimate revisions for fiscal 2022 compared to none lower. The consensus estimate has moved up as well.
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