Sherwin-Williams' Q2 Earnings Lag Estimates, Revenues Beat

Core Insights - Sherwin-Williams Company (SHW) reported second-quarter 2025 earnings of $3 per share, a decrease of approximately 14.3% from $3.50 in the same quarter last year [1] - Adjusted earnings were $3.38 per share, missing the Zacks Consensus Estimate of $3.76 [1] - Revenues reached $6,314.5 million, reflecting a year-over-year increase of about 0.7%, surpassing the Zacks Consensus Estimate of $6,284 million [1] Segmental Review - The Paint Stores Group segment achieved net sales of $3,702.2 million, up around 2.3% year over year, exceeding the Zacks Consensus Estimate of $3,685.4 million, driven by higher selling prices despite a slight decline in volume [2] - The Consumer Brands Group segment saw a decline in net sales of 4.1% year over year to $809.4 million, falling short of the consensus estimate of $821.3 million, primarily due to weak DIY demand in North America and a 2% negative impact from unfavorable foreign currency translation [3] - The Performance Coatings Group segment reported net sales of approximately $1,801.1 million, a slight decline of 0.3% year over year, but beating the consensus estimate of $1,770.5 million, with increased sales from acquisitions offset by lower selling prices [4] Financials - In the first half of 2025, the company generated $1.05 billion in net operating cash and returned $1.27 billion to shareholders through dividends and stock repurchases of 2.5 million shares [5] - As of June 30, 2025, the company had authorization to repurchase 32 million shares of its common stock through open market purchases [5] Outlook - For the third quarter and full-year 2025, the company expects net sales to fluctuate by a low-single-digit percentage, indicating a stable revenue outlook [6] - The effective tax rate is anticipated to be in the low 20% range for 2025, with projected net income per share between $10.11 and $10.41, and adjusted net income per share forecasted between $11.20 and $11.50 for the full year [6] Price Performance - Sherwin-Williams shares have decreased by 0.9% over the past year, compared to a 2.4% decline in the industry [7]