SWK - Embedded Expectations Analysis - 2019 05 17
Stanley Black & Decker, Inc. (SWK:USA) currently trades near historical averages relative to UAFRS-based (Uniform) Earnings, with an 18.8x Uniform P/E. At these levels, the market is expecting profitability to remain stable at current levels, but management has concerns about their revenue growth, margins, and the potential of their MTD collaboration.Specifically, management may lack confidence in their ability to sustain Tools & storage revenue growth, FLEXVOLT sales, and performance momentum. Moreover, they may lack confidence in their ability to sustain outdoor activity performance, meet Tools segment accretion expectations, and double domestic Craftsman product manufacturing. Furthermore, they may be concerned about the progress of value-creation efforts, the potential of an R&D collaboration with MTD, and the impact of tariffs and carryover headwinds on their bottom-line. Also, management may lack confidence in their ability to deliver growth, margin expansion, and transformation, and may be concerned about their capital allocation strategies, their business resiliency, and the scale of their DEWALT 20-volt line.
Stanley Black & Decker is a provider of hand tools, power tools and related accessories, engineered fastening systems and products, services and equipment for oil and gas and infrastructure applications, commercial electronic security and monitoring systems, healthcare solutions, and automatic doors. The company's segments include: Tools and Storage, which is comprised of the power tools and equipment and hand tools, accessories and storage businesses; Industrial, which is comprised of the engineered fastening and infrastructure businesses; and Security, which is comprised of the convergent security solutions and the mechanical access solutions businesses.
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- GAAP and IFRS have failed to provide rules for reliable financial statement reporting
- Stock analyst recommendations are not grounded in disciplined financial analysis
- Credit agencies have been set up to grossly fail in their responsibilities to investors and the public markets
- Utter lack of willingness of major research firms to employ the the most advanced forensic analysis available
We sought to provide investors and company analysts with a source of information that changed all that.
Many years later, our business model remains because little has changed on Wall Street.
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- The governing accounting bodies have created more leeway for mis-estimates and mis-classifications as financials have become unwieldy and overwhelming
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