Stanley Black & Decker’s first quarter results for 2025 came in above Wall Street’s revenue and non-GAAP profit expectations, yet the market responded negatively. Management pointed to ongoing progress in its multi-year transformation, with CEO Donald Allan, Jr. noting improvement in organic growth and gross margins, particularly within the core Tools & Outdoor segment. However, the company faced continued pressure from weak DIY demand, freight inflation, and the early impact of new U.S. tariffs. Allan acknowledged that “we clearly are entering a dynamic period with reduced visibility,” as the company navigates operational changes, shifting trade policies, and evolving consumer trends.
Is now the time to buy SWK? Find out in our full research report (it’s free).
Stanley Black & Decker (SWK) Q1 CY2025 Highlights:
- Revenue: $3.74 billion vs analyst estimates of $3.68 billion (3.2% year-on-year decline, 1.9% beat)
- Adjusted EPS: $0.75 vs analyst estimates of $0.66 (13.7% beat)
- Adjusted EBITDA: $364.7 million vs analyst estimates of $359.5 million (9.7% margin, 1.4% beat)
- Operating Margin: 6.8%, in line with the same quarter last year
- Organic Revenue was flat year on year (-1.3% in the same quarter last year)
- Market Capitalization: $10.27 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions Stanley Black & Decker’s Q1 Earnings Call
- Jeffrey Sprague (Vertical Research Partners) pressed for details on USMCA compliance and tariff rates, with COO Chris Nelson explaining plans to increase compliance and CFO Patrick Hallinan confirming the current tariff structure.
- Timothy Wojs (Baird) asked about the split between price, SG&A cuts, and facility moves for tariff mitigation. Hallinan detailed that price increases are the primary lever in 2025, with longer-term relief coming from shifting supply chains.
- Julian Mitchell (Barclays) inquired about the timing and impact of the tariff headwind and LIFO accounting effects. Hallinan clarified that Q2 will see the heaviest burden, with pricing catching up by Q3.
- Joseph Ritchie (Goldman Sachs) questioned the magnitude of price increases and retailer buy-in. Nelson said the first round is implemented, while further increases are under discussion, noting ongoing collaboration with channel partners.
- Christopher Snyder (Morgan Stanley) sought clarity on retailer inventory and destocking risks. Hallinan said inventories started the year at normal levels but anticipated some softness tied to DIY demand and possible adjustments by specific retailers.
Catalysts in Upcoming Quarters
In the coming quarters, our team will be closely tracking (1) the pace and effectiveness of supply chain moves to reduce tariff exposure, (2) the company’s ability to implement and sustain price increases without significant volume loss, and (3) evolving demand trends in U.S. DIY and professional markets. We will also monitor progress toward cost savings targets and innovation-driven growth.
Stanley Black & Decker currently trades at $66.30, up from $61.18 just before the earnings. At this price, is it a buy or sell? The answer lies in our full research report (it’s free).
Our Favorite Stocks Right Now
The market surged in 2024 and reached record highs after Donald Trump’s presidential victory in November, but questions about new economic policies are adding much uncertainty for 2025.
While the crowd speculates what might happen next, we’re homing in on the companies that can succeed regardless of the political or macroeconomic environment. Put yourself in the driver’s seat and build a durable portfolio by checking out our Top 6 Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-small-cap company Exlservice (+354% five-year return). Find your next big winner with StockStory today.
