Timing clarification: Sherwin-Williams is scheduled to report today, Tuesday, July 28, 2026, before the market opens—not tomorrow. The earnings call is scheduled for 10:00 a.m. EDT.
Sherwin-Williams enters the report with a familiar combination: weak underlying end markets, company-specific market-share gains, rising prices, and increasing input-cost risk.
The most important question is not whether reported sales grow—management has already guided to mid-single-digit growth—but how much of that growth reflects sustainable volume and share gains rather than Suvinil, currency, and pricing. Investors should also focus on whether pricing and cost reductions can preserve margins as raw-material inflation begins flowing through the income statement.
The shares closed at $327.31 on July 27, approximately 3% below their pre-Q1 level and 7% below their July 2 high. Expectations do not appear excessive, but maintaining the full-year earnings outlook is likely already embedded in the setup.
Sherwin-Williams has not provided quarterly EPS guidance, making sales quality, margins, and the updated outlook more informative than the headline EPS comparison.
| Metric | Relevant benchmark |
|---|---|
| Q2 2025 sales | $6.315 billion |
| Q2 2026 sales guidance | Up mid-single digits |
| Implied Q2 sales range* | Approximately $6.57–$6.69 billion |
| Implied midpoint* | Approximately $6.63 billion |
| Q2 2025 adjusted EPS | $3.38 |
| Q2 2025 gross margin | 49.4% |
| FY2026 adjusted EPS guidance | $11.50–$11.90 |
| FY2025 adjusted EPS | $11.43 |
*Treating “mid-single digits” as approximately 4%–6%.
The full-year EPS range implies growth of only about 1%–4%, or 2.4% at the midpoint. That leaves limited room for execution problems once raw-material inflation intensifies.
Paint Stores Group is Sherwin-Williams’ core earnings engine. First-quarter sales increased 3.7%, with same-store sales up 2.4%. Both price and volume contributed, despite little broad-based market recovery.
The strongest areas entering Q2 were:
The best outcome would be continued positive volume alongside pricing. If Paint Stores growth is primarily price-driven while volume turns negative, investors may question the durability of market-share gains and the second-half earnings outlook.
Key figures to watch: same-store sales, volume versus price/mix, residential repaint growth, and PSG segment margin. The Q2 2025 PSG margin was 24.8%.
First-quarter consolidated sales rose 6.8%, but acquisitions contributed 2.7 percentage points and currency added 1.7 points. The distinction was particularly stark in Consumer Brands:
Because Suvinil was acquired in October 2025, it will again provide a sizable year-over-year Q2 contribution. Investors should therefore separate:
A mid-single-digit consolidated sales result could still be disappointing if legacy volumes weaken materially.
This is likely the report’s central debate.
Following Q1, management:
Industrial coatings are seeing inflation first, particularly in Asia and Europe, because of exposure to solvents, resins, and petrochemical derivatives. Architectural coatings should experience the pressure later because more of their purchasing is contractual.
Q2 will indicate whether Sherwin-Williams is still benefiting from a favorable timing gap—pricing already in place while higher costs have yet to flow through fully—or whether inflation arrived sooner than expected.
Positive signal: gross-margin expansion despite Suvinil dilution and higher raw-material costs.
Negative signal: management says current pricing is no longer sufficient to offset its updated cost basket.
Q1 gross margin expanded 90 basis points to 49.1%, even with Suvinil dilution. Management expected normal seasonal improvement moving into the spring and summer selling season, but also warned that commodity inflation would become more visible.
The more difficult issue has been SG&A. Q1 SG&A rose to 34.8% of sales from 33.8%, reflecting:
Management maintained its expectation for only a low-single-digit full-year SG&A increase. Investors should test whether that remains realistic.
The prior-year comparison is also noisy. Q2 2025 included $59 million of restructuring expense, approximately $40 million of building-related transition costs, and substantial non-operating headwinds. Adjusted EPS excludes the restructuring charge but not every other unusual pressure. A strong year-over-year EPS result may consequently contain some comparison benefit rather than solely better underlying operations.
Performance Coatings was better than expected in Q1:
Much of the growth appears to reflect new accounts and share gains rather than end-market recovery. Packaging also has a regulatory tailwind from conversion to non-BPA coatings, while Automotive Refinish is benefiting from direct-install wins and Sherwin-Williams’ distribution and technology offering.
The risk is that PCG has the most immediate raw-material exposure. Strong sales with deteriorating margins would indicate that price is lagging costs. Strong volume and stable or improving margins would be one of the most constructive possible readouts.
Suvinil is improving Sherwin-Williams’ reported growth and increasing its exposure to Latin America, but its margin is below the consolidated average. Investors should look for:
Debt stood at approximately $11.7 billion at the end of Q1, while net debt to adjusted EBITDA was 2.5 times. Interest expense increased sharply, partly because of acquisition financing and building-related debt. Sherwin-Williams nevertheless returned $773 million through dividends and buybacks in Q1.
Q2 is seasonally cash-generative, so cash flow, debt reduction, and the balance between deleveraging and continued repurchases deserve attention.
Management previously reaffirmed:
A simple reiteration may be enough if Q2 margins and volumes are solid. However, the market will examine the language behind the reiteration.
This would reinforce the thesis that Sherwin-Williams can compound earnings through share gains and pricing even without a housing recovery.
This would be an acceptable result, although the stock reaction would likely depend on the confidence of management’s price/cost commentary.
That outcome would raise concerns that the earnings algorithm is becoming too reliant on price increases and cost reductions while demand remains weak.
The likely headline is mid-single-digit sales growth against weak markets, but that alone will not determine the investment read-through. The three decisive variables are:
A clean quarter would show positive PSG volume, continued PCG momentum, and enough pricing to protect margins without damaging demand. Conversely, acquisition-led growth combined with weaker legacy volume and rising costs would make the unchanged full-year guidance considerably less credible.
Sources: Sherwin-Williams Q1 2026 earnings release, earnings-call transcript and Form 10-Q; Q2 2025 earnings release; July 1, 2026 earnings-date announcement; and stock-price data through July 27, 2026.