Sherwin-Williams Company (NYSE:SHW)

For reference point and to allow for comments by others. As of the end of March, 2013.

ROE 38.96%
Trailing PE 20.52
PB 10.68
Div yield 1.10%

They deliver a high quality product and continue to demonstrate solid cash flow and earnings results.

Priced for perfection.

Sherwin-Williams, a maker of specialty paints. Everyone I asked, including my wife, two painting contractors, and even Martha Stewart Living magazine, noted that SHW's paints were best-of-breed - they already knew that. Since Martha Stewart sells a competing brand of paint for DIY'ers, the mention in her magazine was particularly noteworthy.

The stock is levered to the housing and homebuilding market, which has been on a massive tear lately.

RoE

With addition of Comex and the introduction of new applications this is more than just a paint retailer...
Execution has been flawless.

Overvalued.

overvalued

People buying foreclosed properties will be fixing them up, and for do-it-yourselfers, that means paint!

solid company, great franchise, good management, good track record, housing will someday come back

Home owners coming out of recession will want to give their houses a lick of paint... :)

The confidence of this company and thier employees, who basically own the company will outpreform thier wallstreet goals and their competition as they have for the last 30 because that's what they do.

this stock has made me a lot of money!

everybody needs paint!

Analyst: Alex Pape
Date: 3/29/2010
Company: The Sherwin-Williams Company (NYSE: SHW)
Market Cap: 7.3b
Price: $67.01

1) A brief overview of the company:
The Sherwin-Williams Company develops, manufactures, distributes, and sells paint, coatings, and related products. Its customers are concentrated in North and South America, though the company also has operations in the Caribbean, Europe, and Asia. The business is structured into three segments:
Sherwin-Williams Paint Stores – SHW sells its branded paints, stains, tools, and equipment through its 3,354 company-operated stores in the U.S., Canada, Jamaica, Puerto Rico, St. Maarten, Trinidad and Tobago, and the Virgin Islands. Six products are GreenGuard Indoor Air Quality Certified (an independent air quality agency). About 62% of revenue.
Consumer Group – SHW sells its branded, private-label paints, stains, varnishes, and industrial products through mass merchandisers, home centers, independent dealers, and hardware stores in the U.S., Canada, Mexico, Poland, and the U.K. About 16% of revenue.
Global Finishes Group – Manufactures and sells OEM product finishes, automotive finishes, protective and marine coatings, and architectural coatings in North and South America, Europe, and Asia through 539 company-owned architectural, automotive, industrial, and chemical coatings branches. This segment also distributes SHW products in 19 developing countries through wholly owned subsidiaries, JV’s, licensees of technology, and trademarks. About 22% of revenue.

2) What is the competitive landscape?
SHW is the biggest manufacturer of paints and coatings in the U.S. Customers range from professional painting contractors to do-it-yourself homeowners to property managers to industrial manufacturers to original equipment manufacturers (OEMs). While other big players exist, the majority of sales go to professionals, to whom coating quality holds high importance, meaning that SHW competes on quality as well as price.

3) Is this a good long-term business?
SHW’s business is certainly tied to the US housing market, so a slump there isn’t making things any easier for the firm. Also, the company is tied up in various lawsuits—some regarding lead paint, which could lead to costly clean-up expenditures. The company’s overall track record, though, is impressive – shareholders have received an annual return of almost 14%. This figure includes dividends, which the company has never missed; despite the downturn, SHW actually increased its dividend $0.02 to $1.42 a share. The need for paint and coatings is not going anywhere long-term, and SHW is increasingly positioning itself abroad, building on existing operations in China and India and setting up new operations in developing countries. SHW is also an industry leader in newer, environmentally-friendly paints and coatings. Overall, this is a company with a solid management team that has fared well through good times and bad.

Because Cleveland is the city.

I am a retired 34 employee of the Sherwin-Williams Co. and I have spent time with the management team. I have very confidence that Sherwin-Williams management will do what is necessary to turn a profit in these very difficult times. No matter what the balance of the market is doing Sherwin-Williams will be ahead of the pack.

Less building, less machinary running, less paint we need.

This account tracks the performance of the investment firm Ruane, Cunniff, and Goldfarb - the investment manager of Sequoia Fund.