Stanley Black & Decker, Inc. (SWK) — Fundamental Analysis & Key Financial Ratios

Kaplio's reading: Stanley Black & Decker, Inc.

Updated on October 3, 2026 · accounts published on July 29, 2026

Reading of October 3, 2026: A strong cash generator with thin margins, weak returns and heavy debt

Stanley Black & Decker trades at a P/E of 22.4 over the last 12 months, 15 % below its sector median and in line with its ten-year median.

• Is Stanley Black & Decker expensive or cheap? At a P/E of 22.4, Stanley Black & Decker trades 15 % below its sector median and 2 % below its own ten-year median.
• How is the business doing? Operating margin is 8.3 % over the last 12 months, up from 7.6 % in fiscal 2025 but below the 11.6 % average of 2014-2025.
• How strong is the balance sheet? Net debt is 4.5× EBITDA in fiscal 2025, above the 3× ceiling for industrials, and the dividend takes 125 % of earnings.
• What to expect from the next earnings? Analysts expect EPS of $1.56 on November 4, 2026, after eight straight quarters of beating estimates.
• Does it turn margin into cash, and at what multiple of the cycle does it trade? Free cash flow was 171 % of net income in fiscal 2025, and EV/EBITDA of 12.7× sits well below its seven-year average of 17.0×.

Is Stanley Black & Decker expensive or cheap?

Over the last 12 months Stanley Black & Decker trades at a P/E of 22.4, 2 % below its ten-year median of 22.8. It traded at a lower P/E 48 % of the time over the past decade, so the multiple sits in the middle of a range that ran from 6.9 to 48.3. The 310 companies in its sector have a median P/E of 26.2, which leaves a 15 % discount. The free cash flow yield of 8.6 % is well above the 5.2 % earnings yield, so reported profit understates the cash the business brings in.

How is the business doing?

Revenue fell 1.5 % over the last 12 months while EPS rose 35.9 %, so the earnings recovery comes from profitability, with sales slightly down. The operating margin of 8.3 % over the last 12 months improves on 7.6 % in fiscal 2025 but is still below the 11.6 % average of fiscal 2014-2025. Returns are the weak spot: ROIC of 5.9 % over the last 12 months is 2.8 points below the sector median of 8.7 %, and it topped 10 % in only 1 of the last 10 fiscal years, with a low of 3.6 % in 2023.

How strong is the balance sheet?

Net debt in fiscal 2025 came to $40.82 per share, equal to 45 % of the current share price, and 4.5× EBITDA against the 3× considered healthy for industrials. The Altman Z of 2.0 over the last 12 months sits in the grey zone, between 1.81 and 2.99, while a current ratio of 1.43 shows adequate liquidity. The dividend yields 3.6 % and has risen for 11 consecutive fiscal years through 2025, but the payout reached 125 % of fiscal 2025 earnings, so profit alone does not cover it; free cash flow, at 171 % of net income, gives more room.

What to expect from the next earnings?

Stanley Black & Decker has beaten EPS estimates in 8 of the last 8 quarters. In its latest report, on July 29, 2026, it earned $1.57 per share against $1.21 expected, a 30 % beat. For the quarter due November 4, 2026, the consensus is $1.56, roughly level with that result, which leaves room for another beat. The 2027 EPS consensus has held at $5.59 for 18 days among 9 analysts, and revenue estimates are equally stable. Of 37 analysts, 16 rate it a buy, 19 a hold and 2 a sell, a split that leans cautious.

Does it turn margin into cash, and at what multiple of the cycle does it trade?

Industrials are semi-cyclical, so one year of profit can mislead; what counts is the operating margin, how much of it becomes cash and the multiple paid across the cycle. Cash conversion is the strong point: free cash flow reached 171 % of net income in fiscal 2025, far above the 85 % healthy mark. The margin is the weak one, at 7.6 % in fiscal 2025 against a 12 % benchmark, and capex of 1.9 % of revenue sits under the usual 4 % to 8 % range. EV/EBITDA of 12.7× over the last 12 months is below 90 % of its seven-year average of 17.0×, while the P/E of 22.4 is close to its ten-year average of 24.0.

How this was prepared: the data comes from companies' official filings, collected by a professional provider, and from Kaplio's analysis engine (trailing-12-month ratios, 10 years of history and sector medians computed across US-listed companies). The text is written from that data alone, every figure is checked against it before publication, and it is reviewed when the company reports results. This is not investment advice.