investing

The Best Stock in Ohio: Sherwin-Williams

We analyzed publicly traded companies based in the Buckeye State to identify the best stock in Ohio to buy now.

We scoured the nation to identify the best stock in every state. Sherwin-Williams (symbol SHW) is the publicly traded company we picked in Ohio. The company headquarters is located in Cleveland.

A word of caution: Since we selected a single stock from each state (plus one from D.C), and choices in some states are sparse, a few of our picks are best suited to investors comfortable with a higher degree of risk. This is not necessarily one of our 51 favorite stocks in the entire U.S., in other words.

Sherwin-Williams by the Numbers

  • Headquarters: Cleveland
  • Share price: $354.75
  • Market value: $33.0 billion
  • Price-earnings ratio: 23

(Prices and data are as of June 22, 2017)

Shares of paint giant Sherwin-Williams have been on a tear, but they could still climb higher.

The company agreed in March to buy fellow paint company Valspar for $113 per share. CFRA analyst Christopher Muir expects the deal to meet regulatory approval and close in August, and he believes the combined company will be able to achieve $320 million in annual savings within the next four years. The merger will drive earnings growth, says Dmitry Silversteyn, an analyst at investment research firm Longbow Research. Moreover, the combined company should be able to use its prodigious free cash flow to pay down debt while still accelerating growth of its dividend. Long-term demographic trends lend rosy growth prospects to the company, as expected strong housing starts, driven by millennials buying their first homes in coming years, should support paint sales. Silversteyn rates the stock a “buy” with a 12-month price target of $400.

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