Sherwin-Williams Co. (NYSE:SHW)

The valuation ratios exhibited varied trends over the observed period, spanning from March 31, 2022, to December 31, 2025. Generally, the ratios demonstrated volatility, with periods of decline followed by stabilization or modest increases. A consistent, unidirectional trend was not apparent across all metrics.

Price to Earnings (P/E)

The Price to Earnings ratio began at 38.67 and generally decreased through September 30, 2022, reaching 24.87. It then experienced fluctuations, peaking at 34.58 in June 30, 2024, before settling around 34.50 by December 31, 2025. The ratio suggests a relatively stable investor expectation of future earnings growth, with some increased optimism in mid-2024.

Price to Operating Profit (P/OP)

Similar to the P/E ratio, Price to Operating Profit showed a declining trend from 27.85 in March 2022 to 17.07 in September 2022. A subsequent recovery occurred, with the ratio reaching 23.24 by December 2025. This suggests a correlation with earnings performance and potentially improved operational efficiency as reflected in operating profits.

Price to Sales (P/S)

The Price to Sales ratio displayed an initial decrease from 3.48 to 2.60 between March 2022 and December 2022. It then increased to a high of 3.95 in September 2024, before moderating to 3.76 by the end of the observation period. This indicates a changing investor assessment of revenue growth relative to the company’s market capitalization.

Price to Book Value (P/BV)

Price to Book Value experienced a significant decline from 31.59 in March 2022 to 18.55 in December 2022. The ratio then stabilized, fluctuating between approximately 19.27 and 23.16 over the subsequent period, ending at 19.27 in December 2025. This suggests a shift in how the market values the company’s net assets, potentially reflecting changes in asset quality or perceived future returns on equity.

Overall, the observed ratios suggest a period of adjustment followed by relative stabilization. The fluctuations across all ratios indicate sensitivity to market conditions and company performance. The slight increases in P/S and P/OP towards the end of the period may indicate renewed investor confidence, while the P/BV ratio suggests a more conservative valuation of the company’s net asset value.

The price to earnings (P/E) ratio exhibited fluctuations over the observed period, spanning from March 31, 2022, to December 31, 2025. Initial values indicated a decreasing trend through the first three quarters of 2022, followed by a slight increase at the end of the year. This pattern continued into 2023, with a subsequent decline in the third quarter before a notable rise in the fourth quarter. The ratio remained relatively stable in the first half of 2024, experienced a slight decrease in the third quarter, and then stabilized again in the final quarter of 2024. The first half of 2025 showed minimal change, with a slight increase observed in the final two quarters.

Overall Trend

The P/E ratio generally fluctuated between approximately 24 and 39 over the analyzed timeframe. While there were periods of increase and decrease, the ratio did not demonstrate a consistently strong upward or downward trajectory. The ratio appears to have settled in a range of 32 to 36 in the latter half of the period.

Year-over-Year Comparisons

Comparing the final quarter of each year, the P/E ratio moved from 28.48 in 2022 to 33.16 in 2023, then to 32.81 in 2024, and finally to 34.50 in 2025. This suggests a moderate increase in valuation relative to earnings over the four-year period, although the increases were not consistent year-to-year.

Relationship to Earnings Per Share

The P/E ratio’s movements are inversely related to changes in earnings per share (EPS). As EPS increased from $7.02 in March 2022 to $10.37 in December 2025, the P/E ratio generally decreased, although the relationship was not perfectly linear due to concurrent share price fluctuations. Periods of significant EPS growth were often accompanied by a stabilization or decrease in the P/E ratio, indicating that market expectations were adjusting to the improved earnings.

Quarterly Volatility

The largest single-quarter increase in the P/E ratio occurred between September 30, 2023 (24.87) and December 31, 2023 (33.16). The largest single-quarter decrease occurred between March 31, 2022 (38.67) and June 30, 2022 (34.26). These fluctuations suggest potential sensitivity to market events or company-specific news during those periods.

The Price to Operating Profit (P/OP) ratio exhibited fluctuations over the observed period, spanning from March 31, 2022, to December 31, 2025. Initially, the ratio demonstrated a declining trend, followed by periods of relative stability and subsequent increases, ultimately concluding near its starting point.

Initial Decline (March 31, 2022 – September 30, 2022)

From March 31, 2022, to September 30, 2022, the P/OP ratio decreased from 27.85 to 20.54. This decline suggests a potential shift in investor sentiment, possibly reflecting concerns about near-term earnings expectations relative to the share price, or an increase in operating profit per share outpacing share price growth.

Stabilization and Increase (October 1, 2022 – June 30, 2023)

Following the initial decline, the P/OP ratio stabilized and then increased, reaching 20.75 by June 30, 2023. This movement indicates a possible recovery in investor confidence or a slowdown in the growth of operating profit per share relative to the share price. The ratio remained relatively consistent between 19.19 and 20.75 during this period.

Subsequent Volatility (July 1, 2023 – December 31, 2024)

The period from July 1, 2023, to December 31, 2024, was characterized by increased volatility. The P/OP ratio rose to a peak of 24.24 by September 30, 2024, before decreasing slightly to 23.08 by December 31, 2024. This suggests a dynamic market response to company performance and broader economic conditions.

Final Period (January 1, 2025 – December 31, 2025)

In the final period, the P/OP ratio fluctuated between 22.73 and 23.54, concluding at 23.24 on December 31, 2025. This indicates a period of relative stability, with the ratio remaining within a narrow range. The final value is comparable to the ratio observed in the middle of 2023.

Overall Trend

While exhibiting interim fluctuations, the P/OP ratio demonstrates a cyclical pattern over the analyzed timeframe. The ratio began and ended at similar levels, suggesting that investor valuation of operating profit relative to share price remained broadly consistent over the entire period, despite short-term variations.

The observed changes in the P/OP ratio warrant further investigation into the underlying drivers of share price and operating profit per share. Factors such as industry trends, competitive landscape, and company-specific developments likely contributed to these fluctuations.

The price-to-sales (P/S) ratio for the analyzed period demonstrates fluctuations, generally trending upward with notable variations. Initial values indicate a decrease from 3.48 to 2.60, followed by periods of increase and subsequent stabilization. A review of the quarterly figures reveals a complex pattern, influenced by both share price and sales per share movements.

Initial Decline (Mar 31, 2022 – Dec 31, 2022)

The P/S ratio experienced a consistent decline from 3.48 in March 2022 to 2.60 in December 2022. This decrease occurred alongside a decrease in share price, though sales per share also exhibited growth during this period. The ratio’s decline suggests that the decrease in share price outpaced the increase in sales per share.

Subsequent Increase and Volatility (Mar 31, 2023 – Dec 31, 2023)

From March 2023 through December 2023, the P/S ratio showed increased volatility. An initial increase to 3.09 was followed by a decrease to 2.61, then a substantial rise to 3.44. This period coincided with significant fluctuations in both share price and sales per share, indicating a strong correlation between these variables and the P/S ratio. The peak of 3.44 in December 2023 represents the highest value observed during the analyzed timeframe.

Stabilization and Recent Trends (Mar 31, 2024 – Dec 31, 2025)

Following the peak in December 2023, the P/S ratio exhibited a period of relative stabilization, fluctuating between 3.31 and 3.95. The ratio then decreased to 3.76 by December 2025. Sales per share consistently increased throughout this period, while the share price experienced more moderate fluctuations. The slight decrease in the P/S ratio towards the end of the period suggests that sales per share growth may not have been sufficient to offset share price movements.

Overall Observations

The P/S ratio demonstrates sensitivity to changes in both share price and sales per share. While sales per share generally increased over the analyzed period, the P/S ratio’s trajectory was significantly influenced by share price volatility. The ratio’s movement suggests that investor sentiment and market conditions played a substantial role in valuation during this timeframe.

The price-to-book value (P/BV) ratio for the analyzed period demonstrates considerable fluctuation, though generally trending downwards over the observed timeframe. Initial values are relatively high, decreasing significantly before stabilizing and experiencing a final modest increase. A detailed examination reveals distinct phases in the ratio’s behavior.

Initial Decline (Mar 31, 2022 – Dec 31, 2022)

The P/BV ratio exhibits a pronounced decline from 31.59 in March 2022 to 18.55 by December 2022. This decrease coincides with a period where the share price decreased from US$271.37 to US$222.63, while book value per share (BVPS) increased from US$8.59 to US$12.00. The increase in BVPS partially offset the share price decline, but not enough to prevent a substantial reduction in the P/BV ratio.

Stabilization and Subsequent Increase (Mar 31, 2023 – Dec 31, 2023)

From March 2023 to December 2023, the P/BV ratio demonstrates a period of relative stability, fluctuating between 19.12 and 21.32. During this period, the share price increased from US$234.79 to US$311.26, and BVPS increased from US$12.28 to US$14.60. The increases in both share price and BVPS contributed to the stabilization of the ratio.

Recent Fluctuations (Mar 31, 2024 – Dec 31, 2025)

The period from March 2024 to December 2025 shows continued fluctuation, with the P/BV ratio ranging from 19.27 to 23.16. Share price movements are more pronounced, ranging from US$348.13 to US$357.61, while BVPS continues to increase, moving from US$16.48 to US$18.56. The ratio appears to be stabilizing around the 19-21 range, with a slight increase towards the end of the observed period.

Overall, the P/BV ratio has decreased from its initial high of 31.59 to a more moderate level around 19.27-23.16. This suggests that the market is valuing the company’s net assets at a lower multiple of their book value compared to the beginning of the analyzed period. The concurrent increases in both share price and BVPS indicate a complex interplay of market sentiment and underlying asset value.