The analysts might have been a bit too bullish on The Sherwin-Williams Company (NYSE:SHW), given that the company fell short of expectations when it released its quarterly results last week. Sherwin-Williams missed analyst forecasts, with revenues of US$5.4b and statutory earnings per share (EPS) of US$1.97, falling short by 2.4% and 5.8% respectively. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Sherwin-Williams after the latest results.

After the latest results, the 26 analysts covering Sherwin-Williams are now predicting revenues of US$23.6b in 2024. If met, this would reflect a credible 2.9% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to ascend 11% to US$10.60. Before this earnings report, the analysts had been forecasting revenues of US$23.8b and earnings per share (EPS) of US$10.77 in 2024. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.

The analysts reconfirmed their price target of US$337, showing that the business is executing well and in line with expectations. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. Currently, the most bullish analyst values Sherwin-Williams at US$400 per share, while the most bearish prices it at US$219. This shows there is still a bit of diversity in estimates, but analysts don't appear to be totally split on the stock as though it might be a success or failure situation.

Of course, another way to look at these forecasts is to place them into context against the industry itself. We would highlight that Sherwin-Williams' revenue growth is expected to slow, with the forecast 3.9% annualised growth rate until the end of 2024 being well below the historical 6.6% p.a. growth over the last five years. Compare this to the 128 other companies in this industry with analyst coverage, which are forecast to grow their revenue at 4.3% per year. Factoring in the forecast slowdown in growth, it looks like Sherwin-Williams is forecast to grow at about the same rate as the wider industry.

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as the wider industry. The consensus price target held steady at US$337, with the latest estimates not enough to have an impact on their price targets.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Sherwin-Williams going out to 2026, and you can see them free on our platform here.

Even so, be aware that Sherwin-Williams is showing 1 warning sign in our investment analysis , you should know about...

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