Stanley Black & Decker, Inc.
Analysis
After three years of cost cuts and debt paydown, Stanley Black & Decker is growing again: organic sales turned positive in Q2 FY2026 and all three core brands grew. The question is how much of the profit improvement is the business, and how much is a one-time tariff refund.How much of SWK's Q2 profit came from the tariff refund?
- Growth finally turned positive across the whole portfolio.
Q2 FY2026 organic revenue rose 3% and power tools, the weakest line for most of last year, grew 8%. DEWALT, STANLEY and CRAFTSMAN all grew in the same quarter, so the pick-up comes from the portfolio rather than one brand.Where is SWK's commercial and industrial growth coming from by end market?
- The portfolio is smaller, the debt is down and cash is going to the brands.
Selling aerospace fasteners and CAM raised about $1.8 billion, which went straight to paying down debt. That money now funds DEWALT, STANLEY and CRAFTSMAN instead; the trade-off is giving up the one business that was growing fastest.What did SWK give up in earnings by selling CAM and aerospace?
- The do-it-yourself half is now a fight over price and promotions.
Volumes fell faster than prices rose, mostly in cheaper products. Management calls the fixes small, but it has reworked promotions twice, and rising metal costs will likely mean another price rise in 2027, and more lost volume.
- The professional construction channel is still growing at double digits. That is the part of the business least tied to a cautious shopper, so it keeps selling even when home projects dry up.
- Moving production out of China keeps cutting costs faster than tariffs add them. Every shift lowers what it pays on imports, so profit can keep growing without charging customers more.
- STANLEY and CRAFTSMAN hold the growth they showed in Q2. Three brands growing at once means the improvement does not depend on one product line staying hot.
- Growth leans on one-off tariff refunds and easy year-ago comparisons. Strip those out and sales are close to flat, so the recovery is thinner than the headline numbers suggest.
- Battery metal, tungsten and freight costs keep climbing. The company has to raise prices again to protect profit, and shoppers who already traded down may walk away.
- The home-improvement shopper only buys when something is on deal. If every sale needs a discount, the extra volume earns less than the full-price sale it replaced.
| Politician | Transaction | Amount | Traded | Filed |
|---|---|---|---|---|
Donald Trump Republican · Executive | Purchase | ≥$1K | Mar 23 | May 13 |
Ro Khanna Democratic · House · CA-17 | Sale | ≥$1K | Jun 2 | Jul 6 |
Ro Khanna Democratic · House · CA-17 | Purchase | ≥$1K | May 1 | Jun 9 |
Ro Khanna Democratic · House · CA-17 | Purchase | ≥$1K | Apr 13 | May 11 |
Ro Khanna Democratic · House · CA-17 | Purchase | ≥$1K | Apr 24 | May 11 |
Congressional trading data provided by QuiverQuant
How Stanley Black & Decker turned $15.4B of revenue into $633.0M of operating income.
| Revenue | ||
|---|---|---|
| Industrial Segment | $2.1B | ▼ 14.60% YoY |
| Total revenue | $15.4B | |
| Gross profit | $4.5B | 29.4% |
| Operating income | $633.0M | 4.1% |