The Sherwin-Williams Company Reports 2026 Third Quarter Financial Results
SHERWIN WILLIAMS CO (SHW) filed an SEC Form 8-K — Results of Operations and Financial Condition. Exhibit 99.1 NEWS The Sherwin-Williams Company • 1 Sherwin Way • Cleveland, Ohio 44113 • (216) 566-2000 The Sherwin-Williams Company Reports 2026 Third Quarter Financial Results CLEVELAND, October 27, 2026 - The Sherwin-Williams Company (NYSE: SHW) announced its financial results
How this was made
The 30-second read
Why it matters
The guidance revision signals lower profitability expectations, which may lead to a short‑term price decline despite solid cash flow and shareholder returns.
Market read
The earnings release and guidance update are primary drivers for SHW's stock movement and have modest spill‑over to the broader materials sector.
What to watch
Share repurchases and dividend payouts may offset earnings concerns for income‑focused investors.
Consolidated Net sales increased 7.9% to $6.86 billion; diluted net income per share increased 0.9% to $3.38 per share; full year 2026 adjusted diluted net income per share guidance narrowed to $11.85 to $12.15 per share.
Sales growth accelerated across all three reportable segments, but gross margin, segment margins, net income and Consumer Brands Group profit were pressured by higher raw material and supply chain costs, mix, Suvinil-related expenses and higher interest expense.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| Net sales, three months ended September 30GAAP | $6.86B | – | 7.9 % |
| Gross profit, three months ended September 30GAAP | $3.28B | – | – |
| Gross profit percent to Net sales, three months ended September 30GAAP | 47.8 % | – | – |
| Selling, general and administrative expenses, three months ended September 30GAAP | 2,069.1 | – | – |
| Selling, general and administrative expenses percent to Net sales, three months ended September 30GAAP | 30.2 % | – | – |
| Income before income taxes, three months ended September 30GAAP | $1.06B | – | 0.3 % |
| Income before income taxes percent to Net sales, three months ended September 30GAAP | 15.5% | – | – |
| Net income, three months ended September 30GAAP | $821M | – | (1.5)% |
| Diluted net income per common share, three months ended September 30GAAP | $ 3.38 | – | 0.9 % |
| Adjusted diluted net income per share, three months ended September 30non-GAAP | $ 3.63 | – | 1.1 % |
| EBITDA, three months ended September 30non-GAAP | $1.39B | – | 3.4% |
| EBITDA percent to Net sales, three months ended September 30non-GAAP | 20.3% | – | – |
| Adjusted EBITDA, three months ended September 30non-GAAP | $1.40B | – | 3.3% |
| Adjusted EBITDA percent to Net sales, three months ended September 30non-GAAP | 20.5% | – | – |
| Net sales, nine months ended September 30GAAP | $19.32B | – | – |
| Gross profit, nine months ended September 30GAAP | 9,395.7 | – | – |
| Gross profit percent to Net sales, nine months ended September 30GAAP | 48.6 % | – | – |
| Selling, general and administrative expenses, nine months ended September 30GAAP | 6,142.4 | – | – |
| Income before income taxes, nine months ended September 30GAAP | 2,855.8 | – | – |
| Net income, nine months ended September 30GAAP | $2.20B | – | – |
| Diluted net income per common share, nine months ended September 30GAAP | $ 8.95 | – | – |
| Adjusted diluted net income per share, nine months ended September 30non-GAAP | $ 9.67 | – | – |
| EBITDA, nine months ended September 30non-GAAP | $3.82B | – | – |
| Adjusted EBITDA, nine months ended September 30non-GAAP | $3.86B | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| Paint Stores GroupNet sales increased primarily due to selling price increases, which impacted Net sales by a mid-single digit percentage, as well as low-single digit percentage sales volume growth. | $4.02B | – | 4.7 % |
| Consumer Brands GroupNet sales increased primarily as a result of the acquisition of Suvinil, favorable foreign currency translation and a positive shift in mix, partially offset by soft demand in North America. | $937.4M | – | 21.7 % |
| Performance Coatings GroupNet sales increased primarily due to selling price increases, which impacted Net sales by a mid-single digit percentage, and low-single digit percentage sales volume growth. | $1.90B | – | 8.8 % |
Amounts quoted below without a unit are in millions, as in the filing’s tables. Per-share figures are as printed.
Fourth Quarter 2026 and Full Year 2026 outlook
- RevenueFourth Quarter 2026: Up mid-single digit %; Full Year 2026: Up mid to high-single digit %
- Tax rateLow twenty percent
- NoteFull Year 2026 diluted net income per share: $10.92 - $11.22
- NoteFull Year 2026 adjusted diluted net income per share: $11.85 - $12.15
- NoteExcludes $0.82 per share of Valspar acquisition-related amortization expense and $0.11 per share of severance and other restructuring expenses incurred through September 30, 2026.
Capital returns
- The Company returned $749.0 million to shareholders in the quarter through dividends and share repurchases.
- The Company returned cash of $2.98 billion to shareholders in the form of dividends and repurchases of 7.1 million shares of its common stock during the first nine months of 2026.
- Cash dividends were 194.3 for the three months ended September 30, 2026, compared to 195.7 for the three months ended September 30, 2025.
- Cash dividends were 588.9 for the nine months ended September 30, 2026, compared to 594.0 for the nine months ended September 30, 2025.
- At September 30, 2026, the Company had remaining authorization to purchase 22.5 million shares of its common stock through open market purchases.
What drove it
- Consolidated Net sales increased due to higher Net sales in all reportable segments, inclusive of the October 2025 acquisition of Suvinil, and selling price increases, which impacted Net sales by a mid-single digit percentage.
- Paint Stores Group same-store sales increased 3.9%; professional customer end markets were led by a double digit percentage increase in protective and marine, a high-single digit percentage increase in commercial and a mid-single digit percentage increase in residential repaint.
- Performance Coatings Group growth was led by General Industrial, Packaging and Coil, which each increased by a double digit percentage.
- SG&A as a percent of sales decreased in the quarter.
Concerns
- Gross margin was primarily impacted by higher raw material and supply chain related costs and by mix, including dilution from Suvinil and higher growth in lower margin reportable segments.
- Consumer Brands Group segment profit decreased 7.1% to $ 146.2 and reported segment margin declined to 15.6% from 20.4%.
- Income before income taxes increased only 0.3% to $ 1,063.5 despite 7.9% Net sales growth.
- Administrative costs included additional interest expense attributable to an increase in debt.
- Customer sentiment and leading indicators point to muted demand over the remainder of the year and into 2027.
What to watch
- Whether pricing and cost actions offset higher raw material and supply chain related costs.
- North American demand in Consumer Brands Group, where the Company cited soft demand.
- The effect of Suvinil on consolidated growth, mix, gross margin and incremental SG&A expenses.
- Execution against fourth quarter 2026 consolidated Net sales guidance of up a mid-single digit percentage.
- Full-year diluted net income per share within the $10.92 to $11.22 range and adjusted diluted net income per share within the $11.85 to $12.15 range.
Balance sheet and cash flow
- The Company generated $2.59 billion in Net operating cash during the first nine months of 2026.
- Cash and cash equivalents were $ 264.2 at September 30, 2026, compared to $ 241.5 at September 30, 2025.
- Short-term borrowings were $ 2,353.6 at September 30, 2026, compared to $ 1,846.9 at September 30, 2025.
- Current portion of long-term debt was $ 1,498.8 at September 30, 2026, compared to $ 350.5 at September 30, 2025.
- Long-term debt was $ 7,942.7 at September 30, 2026, compared to $ 9,318.1 at September 30, 2025.
- Capital expenditures were 128.7 for the three months ended September 30, 2026, compared to 196.4 for the three months ended September 30, 2025.
- Capital expenditures were 375.4 for the nine months ended September 30, 2026, compared to 567.2 for the nine months ended September 30, 2025.
Analysis
Sherwin-Williams reported third-quarter consolidated Net sales of $6.86 billion, up 7.9%, with growth in all three reportable segments. Paint Stores Group sales increased 4.7% to $4,015.8, Consumer Brands Group sales rose 21.7% to $937.4, and Performance Coatings Group sales increased 8.8% to $1,903.3. Pricing contributed a mid-single digit percentage to both Paint Stores Group and Performance Coatings Group sales, while Suvinil, favorable foreign currency translation and mix supported Consumer Brands Group growth. Paint Stores Group same-store sales increased 3.9% and the Company cited low-single digit percentage sales volume growth in both Paint Stores Group and Performance Coatings Group.
Profit conversion lagged sales growth. Gross profit percent to Net sales declined to 47.8% from 49.2%, while income before income taxes increased 0.3% to $1,063.5 and net income decreased 1.5% to $821.0. The Company attributed the gross-margin pressure to higher raw material and supply chain costs and mix, including Suvinil dilution and higher growth in lower-margin reportable segments. SG&A improved as a percentage of sales to 30.2% from 30.7%, but the Company cited Suvinil-related SG&A and higher Administrative costs associated with additional interest expense attributable to increased debt.
Segment profitability was uneven. Paint Stores Group segment profit increased 2.1% to $974.3, although its reported segment margin declined to 24.3% from 24.9%. Performance Coatings Group segment profit increased 6.2% to $255.2, with reported margin of 13.4% versus 13.7%. Consumer Brands Group was the principal pressure point: segment profit declined 7.1% to $146.2 and reported segment margin fell to 15.6% from 20.4%, reflecting higher raw material and supply chain costs, Suvinil-related SG&A and unfavorable foreign currency transaction gains and losses.
GAAP diluted net income per share rose 0.9% to $3.38, while adjusted diluted net income per share increased 1.1% to $3.63. EBITDA increased 3.4% to $1,390.3 and adjusted EBITDA increased 3.3% to $1,403.4. For the first nine months, Net sales were $19,316.2, net income was $2,199.3, diluted net income per share was $8.95 and adjusted diluted net income per share was $9.67. The Company generated $2.59 billion in Net operating cash over the first nine months and returned $2.98 billion to shareholders through dividends and repurchases of 7.1 million shares.
Management maintained full-year sales guidance for an increase of a mid to high-single digit percentage and expects fourth-quarter Net sales to increase by a mid-single digit percentage. It revised full-year diluted net income per share guidance to $10.92 to $11.22 and narrowed adjusted diluted net income per share guidance to $11.85 to $12.15. The outlook explicitly reflects muted demand through the remainder of 2026 and into 2027, placing emphasis on the Company's pricing, cost-control and market-share actions amid continuing input-cost and mix pressure.
Management, verbatim
Sherwin-Williams third quarter performance demonstrated the resilience of our Company and the strength of our strategy in a challenging demand environment. Despite muted underlying market volumes, we continued to win new customers, increase share-of-wallet and deliver sales growth across all three reportable segments, at or above our guidance, supported by the differentiated value and productivity our solutions deliver to customers.
Heidi G. Petz, Chair, President and Chief Executive Officer
Customer sentiment and the leading indicators we track point to muted demand over the remainder of the year and into 2027. As we navigate this environment, our focus remains clear: win in the marketplace, serve our customers, offset inflation, reduce costs and continue to deliver profitable growth and shareholder value.
Heidi G. Petz, Chair, President and Chief Executive Officer
Not in the filing
stated, not guessed- GAAP operating income was not reported.
- Free cash flow was not reported.
- A total debt figure was not reported.
- Quarterly operating cash flow was not reported.
- Gross margin guidance was not reported.
- Operating expense guidance was not reported.
- Prior outlook was not provided, so comparison of actual results with prior guidance is unavailable.
AlphAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.
Background
Sherwin-Williams disclosed its third‑quarter 2026 financials, including a 7.9% sales increase and a modest EPS rise, while updating full‑year EPS guidance.
Ticker impact
Sherwin-Williams reported Q3 2026 results and revised full-year diluted EPS guidance to $10.92-$11.22 per share.
likely downward pressure as the market prices in the updated EPS guidance
The updated EPS range is below prior expectations, updating future earnings outlook and may trigger sell‑offs.
Market effects
Paint and coatings sector may see broader valuation adjustments as a leading player lowers guidance.
U.S. consumer discretionary index could face slight drag.
Limited to markets tracking U.S. industrials and materials.
Counterpoint
If the guidance revision is modest and the company continues strong cash returns, the stock could be undervalued.
Key entities
- companySherwin-Williams
U.S. paint and coatings manufacturer (NYSE: SHW).
