SWK US S&P 500Russell 1000 Earnings call · transcribed from the recording
Stanley Black & Decker (SWK) · Q2 2026 results and valuation
Share price: $115.62 · 2026-11-11
Results Q2 2026 vs Q1 2026 · previous quarter · published 29 Jul 2026 and 29 Apr 2026
Net income up 489.4% on the previous quarter. Management sounded about as positive as a typical company call, in its script and in answers to analysts.
Only a basic analysis is available for this company at the moment.
1 · Numbers
+489.4%
Net income vs Q1 2026
Outlook given
Net income 351.3M vs 59.6M
Revenue +3.0%
Against the same quarter last year (Q2 2025) it is +244.7%, so it is not just seasonal.
2 · How management spoke
Typical
Less upbeat than 62% of company calls
Answers to analysts: typical, in line with the script.
Similar to last call.
3 · What stood out
Guidance
In line with prior guidance, Stanley Black & Decker anticipates full year adjusted gross margins will expand by approximately 150 basis points…
Valuation
Is Stanley Black & Decker undervalued?
Reverse DCF. Free cash flow from the last full fiscal year (2026-01-03), grown for 10 years, discounted back, plus a terminal value. “Implied growth” is the rate the current price assumes.
At −3.7% growth a year (3-year revenue growth), the model's fair value is $18.24 a share — the stock trades 534% above it. Today's price assumes 13.3% growth a year.
Current price
$115.62
close of 2026-11-11
Market implies growth of iThe yearly free-cash-flow growth, for the next 10 years, that today’s share price already assumes. If you believe the company grows faster than this, the stock is cheap under this model; slower, and it is expensive.
+13.3% for 10 yrs
Fair value / share
$18.24
Buy below
$13.68
Price vs fair value
Overvalued >200%
Price vs buy-below price
Overvalued >200%
Read between the lines
-
Key theme
Stanley Black & Decker will use tariff refunds to accelerate growth investments, and it has incorporated the net impact within the revised EPS…
Source quote
“We will use tariff refunds to accelerate growth investments, and we have incorporated the net impact within the revised EPS... ...gross margins. Second quarter adjusted gross margins included a benefit of approximately 250 basis points from these net tariff refunds.”
-
Guidance
The tax benefit was purely timing, and Stanley Black & Decker still expects the adjusted tax rate to be at 19% for the full year.
-
Figure
Following the sale of its aerospace fasteners business early in the quarter, Stanley Black & Decker was able to deploy those proceeds plus additional operating cash flows...
-
Fading
Stanley Black & Decker's adjusted gross margin rate of 30.2% was down 20 basis points year-over-year, essentially unchanged.
Source quote
“Our adjusted gross margin rate of 30.2% was down 20 basis points year-over-year, essentially unchanged. This was ahead of our expectations, driven primarily by a well-executed outdoor products preseason. Adjusted EBITDA margin of 9.2% was down by 50 basis points year-over-year, slightly ahead of our planning assumptions for the period.”
Tone
How upbeat the language was, compared with other companiesiTone counts positive minus negative finance words, adjusted for length. Executives mostly speak positively, so the labels compare each call with every company's latest call: “typical” is the middle third, “very upbeat” the top tenth, “cautious” the bottom tenth.. Dot: Q2 2026. Ring: Q1 2026.
Script and answers carried a similar tone, so the script's message held up under questioning.
Sentences that drove the tone
“We are confident in our path forward and our ability to activate our brands to generate demand, drive operational excellence for efficiency and productivity gains and accelerate innovation to serve...”
“Approximately $0.15 of the increase is below the line, reflecting lower interest expense due to better cash performance, the share repurchases we did in the second quarter, which will reduce...”
“Organic revenue performance was driven by low single-digit organic growth in Automotive Systems and Fasteners, which outpaced the market as well as broad-based strength across global industrial markets, resulting in...”
Full figures
USD · SEC EDGAR XBRL (10-Q, period end 2026-07-04)
| Metric | Q2 2026period end 2026-07-04 | Q1 2026period end 2026-04-04 | Change | Q2 2025 | YoY |
|---|---|---|---|---|---|
| Revenue | 3.96B | 3.85B | +3.0% | 3.95B | +0.4% |
| Gross profit | 1.31B | 1.16B | +12.8% | 1.07B | +22.4% |
| Operating income | 499.0M | 84.8M | +488.4% | 26.7M | +1768.9% |
| Net income | 351.3M | 59.6M | +489.4% | 101.9M | +244.7% |
| EPS | 2.33 | 0.39 | +497.4% | 0.67 | +247.8% |
| P/E today 20.6 | 22.5 | 28.1 | −5.6 | 21.3 | +1.2 |
Topics
Most discussed now
- I kind of look at it as operationally on the mark with some positives around sales and gross margin and...
- Adjusted EBITDA margin of 11.3% was up 320 basis points year-over-year, slightly ahead of Stanley Black & Decker's planning assumptions for…
- Through disciplined execution of its strategy, Stanley Black & Decker is delivering profitable organic growth and remain on track to…
- Relative to Stanley Black & Decker's expectations for 2Q, interest costs came in lower due to strong operational cash flows, which meant…
Faded since Q1 2026
- Fading Stanley Black & Decker is now positioned with a stronger balance sheet and have unlocked the ability to deploy capital to accelerate…
- Dropped Stanley Black & Decker lasts call, it talked about the fact that it expected to see an inflection in Q2, partially due to...
- Fading This portfolio change is consistent with Stanley Black & Decker's strategy to focus on its core business and commitment to enhancing…
- Fading Stanley Black & Decker expects its capital allocation strategy to be biased towards share repurchases, which the Board has authorized.
Latest announcements
Official filings, newest first.
- Results of operations; Regulation FD disclosure · SEC 8-K
- Regulation FD disclosure · SEC 8-K
- Results of operations · SEC 8-K
- Material agreement; Agreement terminated; New financial obligation · SEC 8-K
- Results of operations · SEC 8-K
- Director or officer change; Shareholder vote results · SEC 8-K
- Regulation FD disclosure · SEC 8-K
- Regulation FD disclosure · SEC 8-K