Enterprise Value to EBITDA (EV/EBITDA)
Earnings before Interest, Tax, Depreciation and Amortization (EBITDA)
Sherwin-Williams Co., EBITDA calculation
US$ in thousands
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
The financial performance indicators demonstrate a consistent upward trajectory from 2021 to 2024, followed by a slight deceleration in growth in 2025. Net income, Earnings Before Tax (EBT), Earnings Before Interest and Tax (EBIT), and Earnings Before Interest, Tax, Depreciation and Amortization (EBITDA) all exhibited increases over the initial four-year period. However, the rate of increase diminished in the final year examined.
- EBITDA Trend
- EBITDA increased from US$3,155,900 thousand in 2021 to US$4,491,500 thousand in 2024, representing a cumulative growth of approximately 42.3%. This indicates strengthening operational profitability over this period. The growth rate slowed considerably in 2025, with EBITDA reaching US$4,480,100 thousand, a marginal decrease from the prior year.
- Relationship between Profitability Metrics
- The progression from Net Income to EBITDA reveals a consistent pattern. Each subsequent metric (EBT, EBIT, EBITDA) is larger than the preceding one, as expected, due to the addition of previously deducted expenses. The difference between EBIT and EBITDA, representing depreciation and amortization, remained relatively stable in absolute terms throughout the period, suggesting consistent capital expenditure and asset utilization policies.
- Growth Rate Deceleration
- While all metrics increased overall, the year-over-year growth rates declined from 2023 to 2025. For example, the increase in EBITDA from 2023 to 2024 was approximately 16.8%, while the increase from 2024 to 2025 was only -0.2%. This deceleration warrants further investigation to determine the underlying causes, such as increased competition, rising input costs, or changes in operational efficiency.
- EBT and EBIT Margins
- The consistent increases in EBT and EBIT suggest improving profitability before considering the effects of financing and accounting adjustments. The relationship between these two metrics remained stable, indicating that interest expense did not significantly impact overall earnings during the observed period.
In summary, the observed financial indicators suggest a period of strong growth followed by a stabilization in the most recent year. The deceleration in growth rates in 2025, particularly for EBITDA, merits further scrutiny to understand the factors influencing this trend.
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Enterprise Value to EBITDA Ratio, Current
Sherwin-Williams Co., current EV/EBITDA calculation, comparison to benchmarks
| Selected Financial Data (US$ in thousands) | |
| Enterprise value (EV) | 88,194,959) |
| Earnings before interest, tax, depreciation and amortization (EBITDA) | 4,480,100) |
| Valuation Ratio | |
| EV/EBITDA | 19.69 |
| Benchmarks | |
| EV/EBITDA, Competitors1 | |
| Linde plc | 18.84 |
| EV/EBITDA, Sector | |
| Chemicals | 19.05 |
| EV/EBITDA, Industry | |
| Materials | 16.27 |
Based on: 10-K (reporting date: 2025-12-31).
1 Click competitor name to see calculations.
If the company EV/EBITDA is lower then the EV/EBITDA of benchmark then company is relatively undervalued.
Otherwise, if the company EV/EBITDA is higher then the EV/EBITDA of benchmark then company is relatively overvalued.
Enterprise Value to EBITDA Ratio, Historical
Sherwin-Williams Co., historical EV/EBITDA calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Enterprise value (EV)1 | 99,466,234) | 97,849,775) | 88,778,727) | 67,907,905) | 79,026,380) | |
| Earnings before interest, tax, depreciation and amortization (EBITDA)2 | 4,480,100) | 4,491,500) | 4,149,900) | 3,545,000) | 3,155,900) | |
| Valuation Ratio | ||||||
| EV/EBITDA3 | 22.20 | 21.79 | 21.39 | 19.16 | 25.04 | |
| Benchmarks | ||||||
| EV/EBITDA, Competitors4 | ||||||
| Linde plc | 19.52 | 18.20 | 18.88 | 18.36 | 16.23 | |
| EV/EBITDA, Sector | ||||||
| Chemicals | 20.20 | 19.12 | 19.51 | 18.57 | 18.35 | |
| EV/EBITDA, Industry | ||||||
| Materials | 17.43 | 15.07 | 15.61 | 14.17 | 13.46 | |
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
3 2025 Calculation
EV/EBITDA = EV ÷ EBITDA
= 99,466,234 ÷ 4,480,100 = 22.20
4 Click competitor name to see calculations.
The Enterprise Value to EBITDA ratio exhibited fluctuations over the five-year period. Initially, a significant decrease was observed, followed by a period of relative stability and a slight upward trend towards the end of the analyzed timeframe.
- Enterprise Value to EBITDA Trend
- In 2021, the EV/EBITDA ratio stood at 25.04. A substantial decline occurred in 2022, with the ratio decreasing to 19.16. This represents a decrease of approximately 23.5%.
- From 2022 to 2023, the ratio increased to 21.39, indicating a recovery in valuation relative to earnings. This represents an increase of approximately 11.6%.
- The ratio continued to rise modestly in 2024, reaching 21.79, and then further increased to 22.20 in 2025. These increases, while positive, were less pronounced than the initial decline, suggesting a stabilization in the company’s valuation multiple.
Enterprise Value demonstrated an initial decrease from 2021 to 2022, falling from 79,026,380 to 67,907,905. However, it subsequently increased over the following three years, reaching 99,466,234 by 2025.
- EBITDA Trend
- EBITDA consistently increased from 2021 to 2024, rising from 3,155,900 to 4,491,500. This represents a growth of approximately 42.3% over the period.
- In 2025, EBITDA experienced a slight decrease to 4,480,100, indicating a potential plateau in earnings growth.
The combined effect of the Enterprise Value and EBITDA trends explains the observed fluctuations in the EV/EBITDA ratio. The initial decrease in the ratio was likely driven by a larger decrease in Enterprise Value coupled with an increase in EBITDA. The subsequent increases in the ratio were influenced by the increasing Enterprise Value and the stabilization of EBITDA growth.
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