The Sherwin-Williams Company (SHW) DCF Valuation
Why we don't show a single “fair value” for SHW
Even the optimistic scenario of a conservative trailing-FCF model ($123.36) sits far below today's price — the market is paying for growth and durability beyond what this model structure captures. The honest lens is the question below: what growth does today's price actually require? The model scenarios are listed further down for reference.
What would today's price require?
$316.89 is justified only if free cash flow grows about +28.0% a year (fading to 2.5% long-run) at a 9.7% required return — faster than the company has actually grown.
| Scenario | FCF growth (fading to 2.5%) | Discount | Value / share |
|---|---|---|---|
| Conservative | 0.5%/yr | 10.7% | $58.36 |
| Base case | 2.0%/yr | 9.7% | $81.37 |
| Optimistic | 5.0%/yr | 8.7% | $123.36 |
| Analyst DCF (FMP) | independent reference — different model | $227.02 | |
Current Price
$316.89
Market-Implied Growth
+28.0%/yr
vs -2.4% 5Y actual
Base-Case Model Value
$81.37
model output — not a price target
SHW DCF Fair Value Calculator
Edit the assumptions to see how they change the estimated fair value. Opens seeded with TGM's data-driven base case for SHW (growth from its own 5-year record, discount from its beta), so the sandbox starts where the scenarios above leave off. Illustrative model — not investment advice.
Base inputs: FCF $2.4B · 0.25B shares · net debt $12.7B
Estimated Fair Value
$79.27
-75.0% vs $316.89
Sensitivity — fair value by discount rate × terminal growth
How the estimated fair value shifts with the discount rate (WACC) and terminal growth, holding your 2.0%/yr FCF growth and 10-year horizon fixed. Green = above today's $316.89; red = below. Your current case is outlined.
| WACC ↓ / Terminal → | 1.50% | 2.00% | 2.50% | 3.00% | 3.50% |
|---|---|---|---|---|---|
| 7.7% | $111 | $119 | $129 | $141 | $156 |
| 8.7% | $87.86 | $93.54 | $100 | $108 | $117 |
| 9.7% | $70.72 | $74.72 | $79.27 | $84.49 | $90.57 |
| 10.7% | $57.31 | $60.22 | $63.48 | $67.16 | $71.35 |
| 11.7% | $46.54 | $48.71 | $51.11 | $53.79 | $56.79 |
About The Sherwin-Williams Company
Cleveland, Ohio-based The Sherwin-Williams Company, established in 1866, is a prominent global player in the development, manufacturing, distribution, and sale of paints, coatings, and related merchandise. Its extensive customer base encompasses professionals, industrial enterprises, commercial clients, and individual consumers. The company's operations are organized into three key segments: 1. The Americas Group: This division provides architectural paints and coatings, protective and marine products, and original equipment manufacturer (OEM) finishes, catering to architectural and industrial painting contractors, as well as do-it-yourself homeowners. 2. Consumer Brands Group: This segment supplies a broad portfolio of both branded and private-label offerings, including architectural paints, stains, varnishes, wood finishes, and various related items like applicators, adhesives, and aerosols, to retailers and distributors. 3. Performance Coatings Group: Focused on specialized applications, this group develops and sells industrial coatings for wood finishing and general industrial use, automotive refinish products, high-performance protective and marine coatings, coil and packaging coatings, and advanced resins and colorants. Sherwin-Williams reaches its global clientele through its approximately 5,000 company-operated stores and facilities (as of February 17, 2022), alongside direct sales personnel and external representatives. The company maintains a significant international footprint, operating across North and South America, the Caribbean, Europe, Asia, and Australia.
- Sector
- Basic Materials
- Industry
- Chemicals - Specialty
- CEO
- Heidi G. Petz