Here's Why Stanley Black & Decker Stock Got Hammered 22% in April

Core Viewpoint - Stanley Black & Decker's stock experienced a significant decline of 21.9% in April due to the impact of newly imposed tariffs, leading management to lower its full-year guidance for earnings and cash flow [1][2]. Financial Impact - The tariffs are expected to negatively affect earnings per share (EPS) by $0.75 in 2025, prompting a reduction in the full-year adjusted EPS guidance from $5.25 to $4.50 [2]. - The forecast for free cash flow in 2025 has been lowered from $750 million to $500 million [2]. - The adjusted cost of sales in the U.S. is approximately $6.8 billion, with significant portions sourced from China and Mexico, which are subject to tariffs [5]. Market Valuation - The revised estimates suggest a stock valuation of 13.6 times earnings in 2025 and 19 times free cash flow, which may be attractive if 2025 is a trough year and management's mitigation strategies are effective [3]. Supply Chain Challenges - The company faces challenges in reshaping its supply chain due to the tariffs, which will require time and effort to implement [5]. - Substantial tariffs are also affecting other Asian suppliers, complicating sourcing adjustments [6]. Sales and Inflation Concerns - Price increases already implemented by the company may negatively impact sales, while potential inflation from tariffs could lead to higher interest rates and reduced demand for tools and fasteners [7]. Investment Consideration - Despite the justified sell-off, the stock may present a decent value if the company can adapt and meet its revised full-year guidance [8].