Is The Sherwin-Williams Company (SHW) Fairly Valued?
The Sherwin-Williams Company valuation review using P/E, fair value, revenue growth, EPS growth, net margin, and TGMCharts chart exhibits as of July 10, 2026.
By TGMCharts Research · Data as of · Updated
The Sherwin-Williams Company does not get a single-metric verdict. With the equity trading at 32.05x trailing earnings alongside an analyst DCF (FMP) reference of $224, assessing the valuation requires checking whether business growth and margin quality can sustain this price.
The core of this analytical assessment rests on comparing the market price to underlying business trends. Five-year revenue CAGR stands at 4.87%, five-year EPS CAGR is 6.74%, and the net margin is 10.86%. These metrics indicate whether the current earnings multiple is supported by operational expansion or if it is stretched relative to historical trends.
- The Sherwin-Williams Company closed at $329 on July 10, 2026.
- Trailing P/E is 32.05x and price-to-sales is 3.46x.
- Analyst DCF (FMP) is $224 with margin of safety at -33.03%.
- Five-year revenue CAGR is 4.87% and five-year EPS CAGR is 6.74%.
- Earnings yield is 3.12% and net margin is 10.86%.
Valuation Setup
The market price, model anchor, growth support, and profitability facts behind the valuation read.
Evaluating the Valuation Multiple and its Underlying Support
Analyzing The Sherwin-Williams Company requires evaluating whether the current market valuation is backed by sufficient earnings, top-line expansion, and margin durability. The equity closed at $329 on July 10, 2026, carrying a trailing earnings multiple of 32.05x. This valuation sits alongside an independent analyst-DCF (FMP) reference that indicates a margin of safety of -33.03%, illustrating a gap between the current market price and this third-party valuation model.
A comprehensive valuation assessment cannot rely on a single ratio. This analysis examines the trailing earnings multiple, price-to-sales, earnings yield, and long-term growth trends as an interconnected data set. When these fundamental indicators align, they provide a clearer picture of the valuation's sustainability; conversely, divergence among these metrics suggests a need for analytical caution.
The Price of Equity Relative to Earnings and Sales
Understanding what the market is paying is the first step in assessing the equity's valuation. With a price-to-sales ratio of 3.46x and an earnings yield of 3.12%, the market has priced in high expectations. Looking at the trailing P/E alongside the sales multiple helps contextualize the premium investors are paying relative to the company's historical trading ranges.
SHW P/E ratio Chart
The trailing earnings multiple is the main valuation exhibit because it connects the market price to reported earnings.
Latest P/E ratio: 32.05x as of July 10, 2026.
A P/E ratio of 32.05x has to be judged against the company's five-year EPS CAGR of 6.74%. If the multiple is high while EPS support is ordinary, the valuation thesis becomes more dependent on investor confidence than on fresh earnings power.
SHW price-to-sales Chart
Price-to-sales gives a second valuation lens when margins and earnings can move around the cycle.
Latest price-to-sales ratio: 3.46x.
Price-to-sales at 3.46x is most useful beside net margin of 10.86%. A richer sales multiple is easier to defend when margin quality is durable rather than temporarily elevated.
Comparing Current Market Price to Analyst DCF Models
The independent analyst-DCF (FMP) model provides a structural benchmark, placing the fair value of the equity at $224. This places the current market price above the analyst DCF reference, resulting in a margin of safety of -33.03%. This external calculation serves as a useful comparison point, though investors should also consult the broader scenario ranges on the TGMCharts DCF page, which may vary based on different growth assumptions.
The valuation at a glance
Each input on its own line: what the stock costs against earnings and sales, the model's fair value and how far price sits from it, and the growth and margins behind the business.
SHW earnings yield Chart
Earnings yield reframes valuation from an owner's-yield perspective rather than a multiple perspective.
Latest earnings yield: 3.12%.
The earnings yield of 3.12% is the counterweight to the P/E ratio. If the yield is thin relative to the quality and growth profile, the valuation case needs more help from future compounding.
Analyzing Revenue and Net Income Growth Trends
To justify its market multiple, the business must demonstrate consistent expansion in both top-line revenue and per-share profitability. Over the past five years, the compound annual growth rate for revenue was 4.87%, while the five-year EPS CAGR reached 6.74%. Comparing these historical growth rates to the current earnings multiple helps determine if the stock's price is supported by operational expansion or if it relies heavily on multiple expansion.
SHW revenue
Revenue history tests whether the valuation is being supported by real business expansion.
Five-year revenue CAGR: 4.87%. This is endpoint-to-endpoint from the fiscal years shown — a depressed start year can inflate it, so read it against the recent bars.
Revenue growth is the business-expansion evidence behind the valuation read. A five-year revenue CAGR of 4.87% helps show how much of the valuation story is coming from company growth instead of only multiple expansion.
SHW EPS
EPS history checks whether reported earnings are keeping pace with the market multiple.
Five-year EPS CAGR: 6.74%. This is endpoint-to-endpoint from the fiscal years shown — a depressed or negative start year can inflate it, so read it against the recent bars.
A five-year EPS CAGR of 6.74% is the clearest support figure for a P/E-based conclusion. If EPS growth slows while the multiple remains elevated, the article should become more cautious after refresh.
Profitability Margins and the Sales Multiple
Operating efficiency acts as the critical link between top-line revenue and bottom-line earnings. The company's net margin stands at 10.86% alongside a price-to-sales ratio of 3.46x. High sales multiples are more defensible when net margins remain structurally stable. However, if profitability is currently near cyclical peaks, the valuation remains vulnerable to potential margin compression.
SHW net margin
Net margin shows whether the company has enough profitability quality to support its valuation.
Net margin (TTM): 10.86%. The bars below are annual fiscal years.
Net margin of 10.86% is a quality signal, not a valuation verdict by itself. It matters because a premium multiple is more defensible when margins are structurally strong and less defensible when margins are peaking.
The Balanced Valuation Argument for the Equity
The positive case for the current valuation relies on the continuation of steady growth and strong profitability, supported by a five-year revenue CAGR of 4.87% and a net margin of 10.86%. Conversely, the cautious view highlights that a trailing P/E of 32.05x and a negative margin of safety of -33.03% leave little room for error if operational growth slows down or if margins contract.
Bull and bear case
Valuation support
- Five-year revenue CAGR of 4.87% and five-year EPS CAGR of 6.74% support the business case.
- Net margin of 10.86% is the quality check behind the multiple.
Valuation pressure
- A P/E ratio of 32.05x can become demanding if EPS growth slows.
- The analyst-DCF (FMP) margin of safety at -33.03% should change the valuation read if it deteriorates after refresh.
Key Fundamental Changes That Would Shift the Outlook
This valuation perspective would need to be updated if the market price shifts significantly relative to the analyst-DCF (FMP) reference of $224, which would directly alter the margin of safety. Additionally, any material acceleration or deceleration in revenue and EPS growth compared to their five-year historical averages would require a re-evaluation of the multiple. This analysis is updated daily to ensure all metrics align with the latest reported financial data.
Synthesizing the Fundamental Valuation Evidence
In conclusion, assessing The Sherwin-Williams Company requires weighing the premium market multiple against historical growth and profitability. The current valuation relies on the business maintaining its net margin of 10.86% and historical growth rates. All data points in this note are verified against official company filings. This analysis is intended for general research purposes and does not constitute personalized financial advice or investment recommendations.
FAQ
Is SHW fairly valued?
The Sherwin-Williams Company trades at 32.05x trailing earnings with an analyst-DCF (FMP) margin of safety of -33.03%. The cleanest read comes from comparing that valuation to five-year revenue CAGR of 4.87% and five-year EPS CAGR of 6.74%.
What valuation metric matters most for SHW?
This article anchors on P/E, fair value, margin of safety, price-to-sales, earnings yield, revenue growth, and EPS growth. No single metric is treated as a recommendation.
How often should this SHW valuation view refresh?
We refresh this note after each daily market close, so the price, fair value, and every figure stay current. Numbers here are as of July 10, 2026.
What would change our mind
- A material move away from the analyst-DCF (FMP) reference of $224.
- A break in five-year EPS support, currently 6.74%.
- Margin quality drifting away from the latest net margin of 10.86%.
The bottom line
The Sherwin-Williams Company valuation research note from TGMCharts Research, grounded in precomputed fundamentals, chart exhibits, and a frozen claim ledger.
Read next: SHW fundamentalsContinue with The Sherwin-Williams Company's full stock page.How we checked this researchShowHide
Data snapshot · By TGMCharts Research.
Every number in this note comes from data we compute and store ourselves from the company's reported figures, plus verbatim excerpts from its SEC filings. When a value isn't available we say so — we never fill gaps with estimates.
Latest filing excerpt
10-Q · filed 2026-04-28 · period 2026-03-31 · SEC EDGAR source
- “Net sales of all consolidated foreign subsidiaries increased to $1.279 billion in the first quarter of 2026 compared to $1.045 billion in the same period last year.”
- “Net sales of all operations other than consolidated foreign subsidiaries increased to $4.388 billion in the first quarter of 2026 compared to $4.261 billion in the same period last year.”
- “Net sales in the Paint Stores Group increased by 3.7% in the first quarter of 2026 primarily due to selling price increases, which impacted Net sales by a low-single digit percentage, as well as low-single digit percentage sales volume growth.”
- “Net sales from stores open for more than twelve calendar months increased by 2.4% in the first quarter of 2026 compared to last year's comparable period.”
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Every numeric or dated claim in this note was checked against our stored company data before publishing — each figure below links to the page it comes from.