Stanley Black & Decker Q4 adjusted EPS beats estimates on margin expansion

Overview

• Tools and outdoor solutions firm's Q4 revenue declined 1%, missing analyst expectations

• Adjusted EPS for Q4 beat analyst expectations

• Company to divest CAM business for $1.8 bln in cash

Outlook

• Stanley Black & Decker expects 2026 EPS between $3.15 and $4.35 on a GAAP basis

• Company targets 2026 adjusted EPS between $4.90 and $5.70

• Stanley Black & Decker forecasts 2026 free cash flow between $700 mln and $900 mln

Result Drivers

• GROSS MARGIN EXPANSION - Higher pricing, tariff mitigation, and supply chain cost reductions drove significant gross margin improvement

• TOOLS & OUTDOOR MARGIN - Despite volume declines, segment margin expanded due to higher pricing and cost controls

• ENGINEERED FASTENING GROWTH - Strong demand in aerospace and automotive drove segment growth and margin expansion

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "hold" and the breakdown of recommendations is 6 "strong buy" or "buy", 13 "hold" and 1 "sell" or "strong sell"

• The average consensus recommendation for the industrial machinery & equipment peer group is "buy."

• Wall Street's median 12-month price target for Stanley Black & Decker Inc is $86.50, about 6.8% above its February 3 closing price of $80.96

• The stock recently traded at 14 times the next 12-month earnings vs. a P/E of 12 three months ago

Press Release: ID:nPnbhWL3Ha

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