Stanley Black & Decker, Inc. (SWK) stock analysis

P/E above its 5-year median

Stanley Black & Decker's P/E of 20.7 is above its own 5-year median of 20.3.

P/E below the industry

Stanley Black & Decker's P/E of 20.7 is below the Cutlery, Handtools, and General Hardware median of 21.2.

EV/EBITDA below its 5-year median

Stanley Black & Decker's EV/EBITDA of 10.9 is below its 5-year median of 17.5.

P/B below the industry

Stanley Black & Decker's price-to-book of 1.97 is below the Cutlery, Handtools, and General Hardware median of 2.07.

Trading below fair value

The share price of $115.62 is below our fair value estimate of $122.93.

Margin of safety under 20%

The price is 5.9% below fair value, less than the 20% cushion we look for.

Revenue growing under 10% a year

Revenue grew -3.7% a year over the last three fiscal years, short of the 10% we look for.

EPS growing under 10% a year

Diluted EPS grew -26.8% a year over the last three fiscal years.

Earnings growth accelerating

Net income grew 91.8% over the last twelve months, against a 5-year average of -20.1% a year.

Growing slower than the industry

Revenue grew 0.4% over the last twelve months; the Cutlery, Handtools, and General Hardware median is 4.3%.

Guidance raised

Stanley Black & Decker raised its 2026 Free cash flow* outlook on Jul 29, 2026.

Gross margin improving

Gross margin was 33.8% over the last twelve months, against 29.7% a year earlier.

Return on equity under 15%

Return on equity was 9.4% over the last twelve months and averaged 5.9% over five years; we look for 15% on both.

Return on invested capital

Needs operating income and invested capital.

Return on equity below the industry

Stanley Black & Decker's return on equity of 9.4% is below the Cutlery, Handtools, and General Hardware median of 13.6%.

Earnings shrank over 5 years

Net income shrank 20.1% a year on average over the last five fiscal years.

Net margin above its 5-year average

Net margin was 5.5% over the last twelve months, against a 5-year average of 4.0%.

Net margin below the industry

Stanley Black & Decker's net margin of 5.5% is below the Cutlery, Handtools, and General Hardware median of 5.5%.

High debt

Debt is 53.2% of shareholders' equity, above the 40% we consider low.

Debt rising against equity

Debt to equity rose from 38.4% five years ago to 53.2%.

Debt covered by cash flow

Operating cash flow over the last twelve months equals 42.3% of total debt.

Interest coverage

Interest expense is not reported separately.

Short-term assets cover short-term debts

Current assets are 1.42 times current liabilities.

Bankruptcy risk in the grey zone

The Altman Z-score is 2.41; above 3 is the safe zone and below 1.8 the distress zone.

Pays a dividend

Stanley Black & Decker paid dividends worth 2.9% of the share price over the last twelve months.

Yield below Treasuries

The 2.9% yield is below the 4.4% on a 1-year Treasury.

Yield below the top quarter

The top quarter of US dividend payers yield 3.8% or more; Stanley Black & Decker yields 2.9%.

Dividend not cut

The dividend per share has not fallen by more than 10% in any of the last 10 fiscal years.

Covered by earnings

Dividends take 59.4% of net income.

Covered by free cash flow

Dividends take 29.1% of free cash flow.