GET DAILY SIGNALSStanley Black & Decker (SWK) Delivers Strong Q3 Beat with +61.5% EPS Growth
Key Takeaways
- Stanley Black & Decker reported third quarter 2026 adjusted earnings per share (EPS) of $2.31, up 61.5% from $1.43 a year earlier and well above the $1.56 consensus estimate.
- Net sales were $3.73 billion, down about 1% year over year but up 4% organically, driven by strong power tools and industrial demand.
- Adjusted gross margin expanded to 39.4%, helped by roughly 430 basis points of net tariff refunds and by productivity gains and favorable product mix.
- GAAP (Generally Accepted Accounting Principles) diluted EPS rose to $1.83 from $0.34 a year ago, while net income climbed to $272.1 million.
- Management raised full-year 2026 adjusted EPS guidance to $5.95–$6.25 and approved a new $1 billion share repurchase authorization.
Why This Quarter Matters
Stanley Black & Decker’s third quarter 2026 report serves as an important checkpoint in the company’s ongoing margin recovery. After dealing with inflation, supply-chain issues, and portfolio changes over several years, investors are focused on whether the Tools & Outdoor segment can maintain organic growth while improving profitability. The results included a sizable net tariff refund benefit that boosted earnings but does not represent the underlying operating performance. In my view, the market is weighing the headline beat against the quality of core results. With the aerospace divestiture completed and a fresh buyback program in place, the quarter gives insight into how management intends to deploy capital amid ongoing tariff and inflation uncertainty. I also checked this using Tickeron’s AI Screener to see how the stock compares to others in the industry.
Breaking Down the Numbers
Stanley Black & Decker reported third quarter 2026 net sales of $3,731.6 million, down about 1% from $3,756 million a year ago but up 4% on an organic basis. GAAP diluted EPS was $1.83, up from $0.34 in the prior-year quarter, while adjusted EPS reached $2.31, up 61.5% from $1.43 a year earlier and roughly 48% above the $1.56 consensus estimate. From what I see, the adjusted gross margin of 39.4% marked an 780 basis point increase year over year. Roughly 430 basis points came from net tariff refunds, with the balance driven by productivity gains and a favorable product mix. Adjusted EBITDA was $609.1 million, and the adjusted EBITDA margin rose 400 basis points to 16.3%.
By segment, Tools & Outdoor revenue increased 2.5% to $3.34 billion with 4% organic growth, including a 10% organic rise in power tools. Engineered Fastening revenue declined 21% to $395.5 million, mainly due to the Consolidated Aerospace Manufacturing divestiture, though organic revenue still grew 2%. Management lifted full-year 2026 adjusted EPS guidance to $5.95–$6.25, implying about 31% year-over-year growth at the midpoint. One thing that stands out is how these figures position SWK relative to its peers after running the numbers through Tickeron’s AI tools.
Market Reaction and Sentiment
Investors reacted positively to the report. Shares of SWK rose more than 13% on the day, buoyed by the adjusted EPS beat, the raised full-year guidance, and the new $1 billion buyback authorization. Sentiment also improved on the stronger-than-expected adjusted gross margin, which exceeded the 35% threshold even after removing the tariff refund impact. At the same time, the market recognized that a portion of the outperformance was non-recurring. The combination of better core margins, solid cash flow, and a clear plan to return capital helped build confidence in the turnaround, though investors remain aware of softer automotive demand and weather-related pressure on outdoor products.
Forward Outlook and What to Watch
Looking ahead, the key question is how much of the recent margin improvement will prove sustainable versus tied to the one-time tariff refunds. Management has noted that inflationary pressures are increasing, especially in steel and electrical components, and a price increase is likely around the start of the year. How those actions are received will test brand strength and customer demand. Capital allocation remains another focus. The new $1 billion repurchase program, paired with a dividend raised for 56 straight years, reflects confidence in cash generation. Investors will monitor whether management balances buybacks with ongoing investment in brands such as DEWALT, Stanley, and Craftsman. Finally, segment trends deserve attention. Power tools and industrial demand have been positive, while automotive markets and weather-sensitive outdoor products remain weaker. The pending sale of the Xcel large-format mower business and the shift to a licensing model for gas walk-behind products will further shape the portfolio in coming quarters.
Exploring Tickeron’s AI Tools
When reviewing earnings reports like this one, I often use Tickeron’s AI Screener to quickly compare performance across peers and identify relevant patterns. It helps filter for technical signals, fundamentals, and industry trends in a single view, which saves time when building a focused watchlist around names such as SWK. The tool has become a regular part of my process for staying on top of movers and sector dynamics.
Disclaimer
The information on this webpage is provided for general informational and educational purposes only and is not intended as investment advice, a recommendation to purchase or sell any security, or an offer or solicitation related to investments. It does not consider your personal financial situation, goals, or risk profile, and all investing carries inherent risks, including the possibility of losing your entire investment. For more details, please review our full disclaimer.
Contributor
Sergey Savastiouk, Ph.D. has a degree in Applied Mathematics from Moscow University and has extensive experience as an entrepreneur, investor, manager, and mathematician. His professional expertise is in applied mathematics, mathematical modeling, system and pattern analysis, and software and hardware system integration. He has served as the CEO of several hi-tech start-up companies and nonprofit organizations, which has given him proven capabilities in business strategy for high-tech start-up companies, market assessment, company formation, team building, product development, marketing, and sales. He has published numerous articles in journals and magazines on related fields. As a retail investor, he spent 15 years developing his proprietary trading and quantitative algorithms (now Tickeron’s A.I.), which brought him significant returns in trading the stock market. His current work and goal in founding Tickeron is to bring professional, sophisticated stock market analysis capabilities to retail investors via an easy-to-use interface.
SWK's RSI Oscillator remains in overbought zone for 11 days
The longer the ticker stays in the overbought zone, the sooner a price pull-back is expected.
Technical Analysis (Indicators)
Bearish Trend Analysis
The Stochastic Oscillator demonstrated that the ticker has stayed in the overbought zone for 16 days. The longer the ticker stays in the overbought zone, the sooner a price pull-back is expected.
Following a 3-day decline, the stock is projected to fall further. Considering past instances where SWK declined for three days, the price rose further in 50 of 62 cases within the following month. The odds of a continued downward trend are 72%.
SWK broke above its upper Bollinger Band on November 04, 2026. This could be a sign that the stock is set to drop as the stock moves back below the upper band and toward the middle band. You may want to consider selling the stock or exploring put options.
Bullish Trend Analysis
The Momentum Indicator moved above the 0 level on October 13, 2026. You may want to consider a long position or call options on SWK as a result. In 64 of 95 past instances where the momentum indicator moved above 0, the stock continued to climb. The odds of a continued upward trend are 67%.
SWK moved above its 50-day moving average on October 20, 2026 date and that indicates a change from a downward trend to an upward trend.
The 10-day moving average for SWK crossed bullishly above the 50-day moving average on October 23, 2026. This indicates that the trend has shifted higher and could be considered a buy signal. In 11 of 13 past instances when the 10-day crossed above the 50-day, the stock continued to move higher over the following month. The odds of a continued upward trend are 85%.
Following a +4.32% 3-day Advance, the price is estimated to grow further. Considering data from situations where SWK advanced for three days, in 192 of 285 cases, the price rose further within the following month. The odds of a continued upward trend are 67%.
The Aroon Indicator entered an Uptrend today. In 130 of 203 cases where SWK Aroon's Indicator entered an Uptrend, the price rose further within the following month. The odds of a continued Uptrend are 64%.
Fundamental Analysis (Ratings)
The Tickeron Price Growth Rating for this company is 2 (best 1 - 100 worst), indicating outstanding price growth. SWK’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron PE Growth Rating for this company is 22 (best 1 - 100 worst), pointing to outstanding earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron Seasonality Score of 50 (best 1 - 100 worst) indicates that the company is fair valued in the industry. The Tickeron Seasonality score describes the variance of predictable price changes around the same period every calendar year. These changes can be tied to a specific month, quarter, holiday or vacation period, as well as a meteorological or growing season.
The Tickeron Valuation Rating of 56 (best 1 - 100 worst) indicates that the company is fair valued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (1.936) is normal, around the industry mean (3.143). P/E Ratio (27.944) is within average values for comparable stocks, (22.467). SWK's Projected Growth (PEG Ratio) (0.170) is slightly lower than the industry average of (1.020). SWK has a moderately high Dividend Yield (0.029) as compared to the industry average of (0.018). P/S Ratio (0.886) is also within normal values, averaging (2.217).
The Tickeron SMR rating for this company is 79 (best 1 - 100 worst), indicating weak sales and an unprofitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron Profit vs. Risk Rating rating for this company is 100 (best 1 - 100 worst), indicating that the returns do not compensate for the risks. SWK’s unstable profits reported over time resulted in significant Drawdowns within these last five years. A stable profit reduces stock drawdown and volatility. The average Profit vs. Risk Rating rating for the industry is 70, placing this stock worse than average.
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Fundamental Analysis Ratings
The average fundamental analysis ratings, where 1 is best and 100 is worst, are as follows
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General Information
a provider of power, hand tools and mechanical access solutions
Industry ToolsHardware
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