Earnings from Hershey, Danaher and Sherwin-Williams

We had three more Buy List earnings reports this morning. Two were good. One was not so good.

Let’s start with the good news.

Hershey (HSY) reported Q4 earnings of $1.28 per share. That was four cents better than estimates. The company had been expecting $1.18 to $1.24 per share. For the year, Hershey made $5.78 per share. This was a good year for them.

For 2020, Hershey sees earnings between $6.13 and $6.24 per share. I like that guidance. Wall Street had been expecting $6.16 per share. The stock is up nicely today on a down day for the market.

Also this morning, Danaher (DHR) reported Q4 earnings of $1.28 per share. Wall Street had been expecting $1.25 per share.

For Q1, Danaher said they expect earnings of $1.06 to $1.09 per share. That’s pretty good. Wall Street was expecting $1.04 per share. For all of 2020, Danaher expects earnings of $4.80 to $4.90 per share (note that that doesn’t include the impact from the GE Biopharma acquisition). The shares are up a bit so far.

Now for the bad one. Sherwin-Williams (SHW) reported Q4 earnings of $4.27 per share. That was 12 cents below estimates. Sherwin’s earnings report is a bit complicated because there are a few charges and adjustments.

Commenting on the financial results, John G. Morikis, Chairman and Chief Executive Officer, said “Sherwin-Williams delivered record results in 2019, driven by above-market growth in our North American paint stores and margin improvement in all of our segments. Sales grew to $17.90 billion as the strength of our stores platform and growth with our largest North American retail partners more than offset softness in certain industrial end markets and choppiness in our international businesses. Gross margin expanded to 44.9% as our pricing initiatives enabled us to gain ground on the raw material inflation we have experienced since 2017. Adjusted EBITDA grew 8.3% to more than $3.0 billion, and adjusted earnings per share increased 14% to $21.12, both of which are full year records. Net cash from operations was more than $2.32 billion, which enabled us to invest in organic growth initiatives, repurchase over 1.6 million shares of our common stock, reduce debt, increase our dividend 31% from the prior year and execute on selected acquisition targets.

For 2020, Sherwin-Williams expects earnings to range between $22.70 and $23.50 per share. Wall Street had been expecting $24.26 per share.

Posted by on January 30th, 2020 at 1:16 pm


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