Building Materials Stocks Q4 In Review: Sherwin-Williams (NYSE:SHW) Vs Peers

Wrapping up Q4 earnings, we look at the numbers and key takeaways for the building materials stocks, including Sherwin-Williams (NYSE:SHW) and its peers.

Traditionally, building materials companies have built competitive advantages with economies of scale, brand recognition, and strong relationships with builders and contractors. More recently, advances to address labor availability and job site productivity have spurred innovation. Additionally, companies in the space that can produce more energy-efficient materials have opportunities to take share. However, these companies are at the whim of construction volumes, which tend to be cyclical and can be impacted heavily by economic factors such as interest rates. Additionally, the costs of raw materials can be driven by a myriad of worldwide factors and greatly influence the profitability of building materials companies.

The 9 building materials stocks we track reported a strong Q4. As a group, revenues beat analysts’ consensus estimates by 2% while next quarter’s revenue guidance was 1.8% below.

While some building materials stocks have fared somewhat better than others, they have collectively declined. On average, share prices are down 4.8% since the latest earnings results.

Widely known for its success in the paint industry, Sherwin-Williams (NYSE:SHW) is a manufacturer of paints, coatings, and related products.

Sherwin-Williams reported revenues of $5.30 billion, flat year on year. This print was in line with analysts’ expectations, but overall, it was a slower quarter for the company with full-year EPS guidance missing analysts’ expectations and a slight miss of analysts’ organic revenue estimates.

“Sherwin-Williams delivered strong fourth quarter results despite continued demand choppiness in the majority of our end markets,” said Chair, President and Chief Executive Officer, Heidi G. Petz.

The market was likely pricing in the results, and the stock is flat since reporting. It currently trades at $360.98.

Read our full report on Sherwin-Williams here, it’s free.

Founded in 1909, Vulcan Materials (NYSE:VMC) is a producer of construction aggregates, primarily crushed stone, sand, and gravel.

Vulcan Materials reported revenues of $1.85 billion, up 1.1% year on year, outperforming analysts’ expectations by 2.1%. The business had a stunning quarter with a solid beat of analysts’ EBITDA estimates.

Although it had a fine quarter compared to its peers, the market seems unhappy with the results as the stock is down 11.5% since reporting. It currently trades at $239.27.