Sherwin-Williams (SHW) Stock Falls on Q3, FY20 Warning

September 28, 2021 6:25 PM EDT

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The Sherwin-Williams Company (NYSE: SHW) stock was trading around 3.5% lower after-hours following the company’s updated Q3 and full 2021-year guidance.

The company lowered its Q3 revenue guidance, expecting flat to down slightly compared to the same period last year, and established Q3 EPS in the range of $1.80 to $1.90 which was below the consensus of $2.44.

For the full 2021-year the company expects the revenue to be up by a high single digit percentage over 2020, and EPS to be between $7.21 and $7.41, versus the consensus of $9.21.

While demand remains strong across the company’s pro architectural and industrial end markets and the company continues to make investments in its strategic growth initiatives, including bringing 50 million gallons of additional architectural production capacity online over the next two quarters, John G. Morikis, the Chairman, President and CEO of the company, said that the previously reported raw material availability challenges and inflation headwinds have worsened. According to Morikis the company doesn’t expect to see improved supply or lower raw material pricing in Q4 as anticipated, and is increasing its full-year raw material inflation outlook to be up a high-teens percentage compared to last year.

In addition, the company made an announcement today, according to which it has signed an agreement to acquire Specialty Polymers, Inc., a leading manufacturer and developer primarily of water-based polymers used in architectural and industrial coatings and other applications, in a transaction expected to close by the end of 2021.

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