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New Britain, Connecticut-based Stanley Black & Decker, Inc. (SWK) provides hand tools, power tools, outdoor products, related accessories, engineered fastening systems, and several other items and services. With a market cap of $12.5 billion, SWK employs over 50,000 people and its operations span the Americas, Europe, and Asia.
Companies worth $10 billion or more are generally described as "large-cap stocks," Stanley Black & Decker fits right into that category, with its market cap exceeding this threshold, reflecting its notable size and influence in the tools & accessories industry.
Despite its strengths, Stanley Black & Decker has slipped over 27% from its two-year high of $110.88 touched on Sept. 27. Furthermore, SWK stock tanked 25.3% over the past three months, significantly underperforming the Dow Jones Industrials Average’s ($DOWI) 2.7% gains during the same time frame.
Over the longer term, SWK’s performance looks even grimmer. The stock has observed a marginal decline over the past six months and plunged over 18.1% in the past 52 weeks, compared to DOWI’s surge of 10.7% over the past six months and 15.4% over the past year.
To confirm the sharp downturn, SWK has traded substantially below its 50-day moving average since late October and consistently below its 200-day moving average since early November.
Despite delivering better-than-expected earnings, shares of Stanley Black & Decker fell 8.8% after the release of its Q3 results on Oct. 29. The company’s strategic focus on accelerating operations and supply chain transformation to improve fill rates and better align inventory with customer demand significantly boosted profitability. Stanley Black & Decker reported an impressive 16.9% year-over-year growth in adjusted non-GAAP net earnings from continuing operations, reaching $185 million. Additionally, the adjusted EPS of $1.22 for the quarter exceeded analysts’ expectations by a notable 18.5%.
However, the company faced a 5.1% year-over-year and a 6.8% quarter-on-quarter decline in net sales, amounting to $3.8 billion. This decrease was due to declining volumes, currency impacts, and the divestiture of the infrastructure business, which unsettled investor confidence.
Stanley Black & Decker has significantly underperformed its peer Snap-on Incorporated’s (SNA) 32.5% surge over the past six months and 19.6% returns over the past year.
Among the 15 analysts covering the SWK stock, the consensus rating is a “Hold.” Its mean price target of $103.27 indicates a 27.6% upside potential to current price levels.
