Sunday, January 1, 2012

Sherwin Williams: First step of a housing recovery

When home maintenance is done, the first major improvement to the cosmetic appeal is a can of paint. Thus with the bottoming of housing starts and a spike in remodeling permits (see graph below), it may be time to buy a paint company.

Sherwin Williams is the top paint supplier in the US. The sales at their paint stores are growing at a 7.8% rate and margins are expanding. The dividend is stable and should have room for growth with new sales growth.

The author will buy Sherwin Williams at $87/share.


Lockstep said...

The author bought shares at $106 and has enjoyed a 30% + rise since.

Lockstep said...

This stock is on a tear. Based on earnings this could go to $165/share.

Lockstep said...

This stock has run too far too fast. Closing out the position at $149 for a 40% gain.


The housing market is recovering very slowly.