Stanley Black & Decker, Inc. SWK has been experiencing recovery in the Engineered Fastening segment, driven by solid momentum in the aerospace market. The company’s aerospace business achieved 35% organic growth in fourth-quarter 2025. Also, recovery in the automotive business due to growth in demand for its systems across auto OEM markets holds promise. In 2025, the segment’s revenues grew 3% on an organic basis.
The company executed its multi-year global cost-reduction program (completed in fourth-quarter 2025), which comprised a series of initiatives to resize the organization, reduce inventory and optimize the supply chain to boost profitability. The program successfully generated about $2.1 billion in pre-tax run-rate savings, including incremental savings of $120 million in the fourth quarter.
Stanley Black remains open to divesting its non-core assets. This month, it sold its Consolidated Aerospace Manufacturing LLC (“CAM”) business to Howmet Aerospace Inc. HWM. The divestment, carrying a cash value of about $1.8 billion, is expected to help Stanley Black to focus more on its core businesses, lower debt and support its capital-allocation priorities.
Regarding rewards to shareholders, the company used $500.6 million for paying out dividends in 2025, reflecting an increase of 1.9% year over year. Also, in July 2025, the quarterly dividend was hiked by a penny to 83 cents per share (annually: $3.32 per share).
SWK Stock’s Price Performance
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In the past six months, this Zacks Rank #3 (Hold) company's shares have gained 13.9% compared with the industry’s 10.4% growth.
However, soft demand for power tools across retail markets in North America and other developed markets is hurting its Tools & Outdoor segment. Persistent softness in the DIY market and tepid demand for hand tools also remain concerning. In 2025, revenues from the segment declined 1.1% year over year to about $13.1 billion.
The company’s highly leveraged balance sheet remains another concern. Exiting 2025, Stanley Black’s long-term debt remained high at $4.7 billion. Its current maturities of long-term debt totaled $554.8 million. Also, its cash and cash equivalents of $280.1 million do not look impressive considering the high debt level.
Key Picks
A couple of better-ranked companies from the same space are discussed below.
Kennametal KMT currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
KMT delivered a trailing four-quarter average earnings surprise of 35.4%. In the past 60 days, the Zacks Consensus Estimate for Kennametal’s 2026 earnings has increased 16.1%.
Flowserve Corporation FLS presently carries a Zacks Rank #2 (Buy). FLS delivered a trailing four-quarter average earnings surprise of 17.3%. In the past 60 days, the consensus estimate for Flowserve’s 2026 earnings has increased 5.1%.
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Free: See Our Top Stock And 4 Runners UpStanley Black & Decker, Inc. (SWK) : Free Stock Analysis Report
Flowserve Corporation (FLS) : Free Stock Analysis Report
Kennametal Inc. (KMT) : Free Stock Analysis Report
Howmet Aerospace Inc. (HWM) : Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
