AI interpretation based on checked source excerpts. Issuer assertions and evidence limitations remain explicit.
Policy quality-scores-3: six equally weighted categories. The overall score requires full coverage. Missing inputs are not zero. Qualitative grades are sourced interpretations, not probabilities. 5/6 · 31/10/2026
Moat—
Insufficient evidence for every rubric criterion; no category score is inferred.
structural advantage · 2/4 · Established professional and consumer brands, realized pricing and completed efficiency improvements support commercial differentiation. However, the passages provide no comparative premiums, protected distribution or relative unit costs. These are credible capabilities with an unproven structural barrier, supporting a mixed assessment rather than a positive moat verdict.
durability · — · The catalog establishes current brands and a completed cost program, but does not show how long their economic advantages persist against competitors. Historical pricing and recovery cannot identify a defensible duration without evidence of sustained premiums, protected customer relationships or difficult-to-replicate cost advantages.
customer dependency · — · Professional tool offerings and continuing demand establish product relevance, but do not establish customers' dependence on Stanley Black & Decker. The passages lack compatibility restrictions, switching expenditure, qualification requirements or other evidence that customers face material difficulty replacing its products.
erosion resilience · 2/4 · Pricing and productivity have helped absorb recent tariff pressure, and second-quarter 2026 volume and gross margins improved. Earlier inflation and supply-chain pressures overwhelmed pricing, however, and tariff refunds contributed materially to recent gains. Demonstrated recovery supports mixed resilience, without establishing protection against competitive erosion.
Pricing power50
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
realized pricing · 2/4 · Tools & Outdoor pricing increased 7% in 2022 and 4% in first-quarter 2026, alongside volume declines of 12% and 5%. Second-quarter 2026 pricing was flat while volume grew 3%; Engineered Fastening pricing rose 1%. These observed outcomes demonstrate pricing ability, but do not isolate elasticity or durable premiums.
retention · 2/4 · Indirect demand evidence is mixed: 2023 U.S. retail point-of-sale demand exceeded 2019 levels, and second-quarter 2026 Tools & Outdoor and Engineered Fastening volumes grew 3% and 2%. First-quarter Tools & Outdoor volume declined 5%. These observations support continuing demand, without establishing cohort retention or switching friction.
margin resilience · 2/4 · Pricing failed to offset inflation, supply-chain costs and lower volume in 2022. First-quarter 2026 Tools & Outdoor pricing largely offset tariff expenses, while second-quarter gross margins improved substantially. Productivity and mix contributed, but approximately 250 basis points of consolidated margin benefit came from net tariff refunds, limiting attribution to pricing power.
contractual freedom · 2/4 · Actual price increases demonstrate practical discretion to change commercial prices. Reliance on home centers and mass merchants, retailer consolidation and disclosed competitive-concession risks constrain that discretion. This is an indirect assessment of commercial freedom; customer repricing clauses, price protections and commitment periods are not supplied.
Predictability71
5 consecutive published annual periods. Equal weights: nondeclining revenue frequency; revenue-growth volatility (5–40pp); positive FCF frequency; FCF-margin volatility (3–20pp). Stability indicator, not a growth forecast.
- Nondeclining revenue years (%)
- 25.00
- Revenue growth volatility (pp)
- 5.65
- Positive FCF years (%)
- 80.00
- FCF margin volatility (pp)
- 6.47
- observedAnnualPeriods
- 5.00
Financial strength10
Equal-weight grades: debt/FCF (1–8x), net debt/earnings before interest and tax (0–5x), interest service (1–12x), current ratio (0.75–2x). Earnings use reported operating income, an original issuer-reported unadjusted EBIT reconciled to net income, income tax and signed net interest, or reported pretax profit plus reported gross interest expense. Reported EBIT is distinct from GAAP operating income and gross interest. Interest service uses earnings/interest expense; if unavailable, it uses reported operating cash flow/cash interest paid, without relabeling cash paid as accrued expense. Nonpositive cash flow/earnings score 0 for their service component; reported zero interest with a positive numerator scores 100. Net cash scores 100 for net leverage. Missing disclosures remain unavailable. General nonfinancial-company rubric, not a credit rating; exceptional and nonoperating gains are not normalized out. IFRS finance-cost and cash-flow classifications retain their reported scope.
- debtFcfGrade
- 0.00
- netDebtEbitGrade
- 0.00
- interestCoverageGrade
- 7.36
- currentRatioGrade
- 31.18
- Debt / FCF (x)
- 8.52
- Net debt / operating income (x)
- 5.98
- Current ratio (x)
- 1.14
Capital allocation51
Three-year equal-weight indicators: pretax return on average invested capital (0–25%; equity + debt − cash, each year and its prior year), share-count growth (0–5%, lower better), share-based cost/revenue (2–20%, lower better), consolidated FCF/net income (0–1x). Return uses reported operating income, an original issuer-reported unadjusted EBIT reconciled to net income, income tax and signed net interest, or EBIT calculated from reported pretax profit plus reported gross interest expense; the issuer-reported EBIT is distinct from GAAP operating income and gross interest; exceptional/nonoperating gains are not normalized out. Share-based cost uses the reported cash-flow add-back or, if absent, separately reported recognized compensation expense; the latter never becomes an FCF adjustment. Nonpositive net income scores 0 for cash conversion; absent income/FCF stays unavailable. ROIC remains undefined for nonpositive invested capital; the explicit asset-return alternative does not change the ROIC chart. Missing financial inputs alone never trigger an alternative. Does not establish acquisition quality or buyback timing.
- 3-year pre-tax operating return (%)
- 4.14
- 3-year average dilution (%)
- 0.69
- 3-year average SBC / revenue (%)
- 0.61
- cashConversionGrade
- 0.00
Management63
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
capital discipline · 2/4 · The completed $1.8 billion CAM sale and commercial-paper repayments demonstrate concrete balance-sheet action. First-half 2026 operating cash flow of $374.3 million exceeded $123.4 million of capital and software expenditures, but dividends, treasury purchases and forward settlement consumed additional cash. These actions support mixed discipline; repurchase value creation remains unproven.
incentive alignment · 3/4 · Below-target annual payouts and a 19.2% multiyear PSU payout demonstrate compensation responding to weak performance, without discretion on 2025 annual payouts. Clawbacks, hedging restrictions and ownership-guideline compliance reinforce alignment, although ownership includes unvested time-based units. Shareholders subsequently adopted minimum vesting with exceptions alongside additional share authorization.
execution · 2/4 · The reported cost program exceeded its original target, CAM was sold and second-quarter volume improved. Against those achievements, multiyear incentive metrics were largely below threshold and first-quarter Tools & Outdoor volume declined. This assessment uses reported outcomes and indirect demand evidence; recent margin improvement also benefited from tariff refunds.
governance · 3/4 · Disclosed proxy access, written consent, special-meeting rights and annual director terms provide concrete accountability mechanisms. Independent committees, except the Executive Committee, and an immediately effective Lead Independent Director appointment support oversight. The scheduled October 2026 Chair transition is not verified as completed, and exceptional governance effectiveness remains unestablished.
Evidence
The Company's portfolio of trusted, globally recognized brands is central to its commercial strategy, particularly within the Tools & Outdoor segment.
2025 Form 10-K, filed 2026-02-24; brand strategy · Filed 24/02/2026
Professional products, primarily under the DEWALT® brand, include professional grade corded and cordless electric power tools and equipment including drills, impact wrenches and drivers, grinders, saws, routers, sanders, and concrete prep and placement tools as well as pneumatic tools and fasteners including nail guns, nails, staplers and staples, and concrete and masonry anchors.
2024 Form 10-K, filed 2025-02-18; professional power-tool products and DEWALT brand · Filed 18/02/2025
DIY and tradesperson focused products include corded and cordless electric power tools sold primarily under the CRAFTSMAN® and STANLEY® brands, and consumer home products such as household power tools, hand-held vacuums, and small appliances primarily under the BLACK+DECKER® brand.
2024 Form 10-K, filed 2025-02-18; consumer and tradesperson brands · Filed 18/02/2025
Tools & Outdoor net sales increased $1.606 billion, or 13%, in 2022 compared to 2021 due to a 7% increase in price and a 21% increase from acquisitions, partially offset by a 12% decrease in volume and a 3% decrease from foreign currency.
2023 Form 10-K, filed 2024-02-27; 2022 Tools & Outdoor price, volume, acquisitions and currency bridge · Filed 27/02/2024
Tools & Outdoor net sales were up 2% year over year, as higher pricing (+4%) and currency (+3%) were partially offset by volume declines (-5%).
First-quarter 2026 results, filed 2026-04-29; Tools & Outdoor price, volume and currency · Filed 29/04/2026
A significant portion of the Company’s products are sold through home centers and mass merchant distribution channels in the U.S.
2024 Form 10-K, filed 2025-02-18; home-center and mass-merchant distribution exposure · Filed 18/02/2025
and Europe. A consolidation of retailers in both North America and abroad has occurred over time and the increasing size
11
and importance of individual customers creates risk of exposure to potential volume or profitability loss.
2024 Form 10-K, filed 2025-02-18; continuation of distribution exposure and retailer-consolidation risk · Filed 18/02/2025
Price reductions taken by the Company in response to customer and competitive pressures, as well as price reductions and promotional actions taken to drive demand that may not result in anticipated sales levels, could also negatively impact its business.
2024 Form 10-K, filed 2025-02-18; potential customer and competitive pricing pressure · Filed 18/02/2025
Global Cost Reduction Program
In mid-2022, the Company launched a Global Cost Reduction Program comprised of a series of initiatives designed to generate targeted pre-tax run-rate cost savings of $2.0 billion by resizing the organization, reducing inventory, and transforming its supply chain with the ultimate objective of driving long-term growth, improving profitability and generating strong cash flow.
First-quarter 2026 Form 10-Q, filed 2026-04-29; cost-program scope and original target · Filed 29/04/2026
The program was completed as of the end of 2025 and generated approximately $2.1 billion of pre-tax run-rate savings, exceeding its original cost savings target.
First-quarter 2026 Form 10-Q, filed 2026-04-29; completed program and pre-tax run-rate savings · Filed 29/04/2026
Year-over-year segment margin expansions were largely driven by net productivity improvements and favorable automotive volume and mix.
Second-quarter 2026 results, filed 2026-07-29; Engineered Fastening productivity, volume and mix · Filed 29/07/2026
•Gross margin of 33.0%, up 600 basis points versus prior year; adjusted gross margin* of 33.7%, up 620 basis points versus prior year; both included a benefit of roughly 250 basis points from net tariff refunds1
Second-quarter 2026 results, filed 2026-07-29; consolidated gross margins and net tariff-refund contribution · Filed 29/07/2026
Excluding these adjustments, gross profit was 26.0% of net sales in 2022 compared to 33.6% in 2021, as price realization was more than offset by commodity inflation, higher supply chain costs, including the impact of planned production curtailments, and lower volume.
2023 Form 10-K, filed 2024-02-27; 2022 versus 2021 adjusted gross profit and operating drivers · Filed 27/02/2024
Higher pricing was largely offset by increased tariff expenses.
First-quarter 2026 results, filed 2026-04-29; Tools & Outdoor pricing versus tariff expenses · Filed 29/04/2026
Similarly, if such efforts to reform the cost structure are delayed relative to competitors or other market factors, the Company may lose market share and profits.
2024 Form 10-K, filed 2025-02-18; risk of cost restructuring lagging competitors · Filed 18/02/2025
1 Includes IEEPA tariff refund gain partially offset by directly attributable variable incentive compensation costs, growth investments, and taxes (for EPS only)
Second-quarter 2026 results, filed 2026-07-29; definition of net tariff-refund benefit · Filed 29/07/2026
Tools & Outdoor net sales were up 3% year over year, as higher volume (+3%) and currency tailwinds (+1%) were partially offset by the previously announced strategic transition to a licensing model for the gas walk-behind outdoor products (-1%).
Second-quarter 2026 results, filed 2026-07-29; Tools & Outdoor volume, currency and licensing transition · Filed 29/07/2026
Pricing was flat. Organic revenue* increased 3%, primarily driven by power tools strength in U.S.
Second-quarter 2026 results, filed 2026-07-29; Tools & Outdoor flat pricing and organic growth · Filed 29/07/2026
Engineered Fastening net sales were down 18% year over year, due to the CAM divestiture (-21%), which was partially offset by volume (+2%) and pricing (+1%), while currency was flat.
Second-quarter 2026 results, filed 2026-07-29; Engineered Fastening divestiture, volume, pricing and currency · Filed 29/07/2026
The 2023 U.S. retail point-of-sale demand remained above pre-pandemic 2019 levels, supported by price increases and strength in professional tools.
2024 Form 10-K, filed 2025-02-18; 2023 U.S. retail point-of-sale demand compared with 2019 · Filed 18/02/2025
AND SUBSIDIARIES
SUMMARY OF CASH FLOW ACTIVITY
(Unaudited, Millions of Dollars)
SECOND QUARTER
YEAR-TO-DATE
2026
2025
2026
2025
OPERATING ACTIVITIES
Net earnings
$
351.3
$
101.9
$
410.9
$
192.3
Depreciation
101.8
92.7
186.2
183.8
Amortization
27.6
37.4
56.2
74.7
(Gain) loss on sales of businesses
(273.7)
—
(270.6)
0.3
Asset impairment charges
5.3
—
28.0
—
Changes in working capital1
282.1
127.6
(106.7)
(341.4)
Other
268.7
(145.3)
70.3
(315.4)
Net cash provided by (used in) operating activities
763.1
214.3
374.3
(205.7)
INVESTING AND FINANCING ACTIVITIES
Capital and software expenditures
(64.9)
(79.6)
(123.4)
(144.6)
Proceeds from sales of businesses, net of cash sold
1,814.6
—
1,814.7
5.0
Payments on long-term debt
—
(0.3)
(500.1)
(500.3)
Net short-term commercial paper (repayments) borrowings
(1,750.2)
(98.2)
(604.8)
1,038.0
Purchases of common stock for treasury
(252.1)
(0.8)
(267.4)
(12.5)
Cash settlement on forward stock purchase contract
(125.0)
—
(125.0)
—
Cash dividends on common stock
(124.3)
(124.0)
(250.3)
(248.5)
Other
4.0
12.7
11.1
17.0
Net cash (used in) provided by investing and financing activities
(497.9)
(290.2)
(45.2)
154.1
Effect of exchange rate changes on cash
(5.6)
42.6
(12.5)
74.1
Increase (decrease) in cash, cash equivalents and restricted cash
259.6
(33.3)
316.6
22.5
Cash, cash equivalents and restricted cash, beginning of period
344.4
348.6
287.4
292.8
Second-quarter 2026 financial exhibit, filed 2026-07-29; unaudited cash-flow activity in millions of dollars, second-quarter and year-to-date 2026 versus 2025 · Filed 29/07/2026
Divestitures
On April 6, 2026, the Company sold the CAM business to Howmet Aerospace for $1.8 billion in cash.
Second-quarter 2026 Form 10-Q, filed 2026-07-29; completed April 6, 2026 CAM sale · Filed 29/07/2026
In the second quarter of 2026, the Company utilized the majority of the net proceeds from the CAM divestiture to repay commercial paper borrowings.
Second-quarter 2026 Form 10-Q, filed 2026-07-29; use of CAM proceeds to repay commercial paper · Filed 29/07/2026
Our 2025 compensation program reflects this philosophy, as performance results under the Company’s 2025 MICP were below target resulting in bonus payouts ranging from 66.8% to 72.3% of target for named executive officers and our performance results under the 2023–2025 Long-Term Incentive Plan Performance Share Units (“LTIP PSUs”) resulted in a 19.2% payout as a result of below threshold performance for all metrics in 2023, 2024 and 2025 other than CFROI performance for 2023, which was above target.
2026 proxy, filed 2026-03-06; actual 2025 annual incentive and 2023–2025 PSU performance and payouts · Filed 06/03/2026
The Compensation Committee applied no discretion in determining performance and payouts under the 2025 MICP for our named executive officers.
2026 proxy, filed 2026-03-06; no discretion applied to named executive officers' 2025 annual payouts · Filed 06/03/2026
Shares owned by the executive officer (or an immediate family member living in the same household), shares held in trust for the benefit of the executive officer, vested stock-based equity awards, unvested and vested time-based RSUs and any deferred stock-based equity awards are considered in measuring an executive officer’s stock ownership for purposes of this policy; however, unvested stock options, unexercised stock options and unvested performance-based equity awards are not so considered.
2026 proxy, filed 2026-03-06; securities counted toward executive ownership guidelines · Filed 06/03/2026
All executive officers are in compliance with the stock ownership guidelines as of December 31, 2025.
2026 proxy, filed 2026-03-06; ownership-guideline compliance as of December 31, 2025 · Filed 06/03/2026
Our compensation programs follow best practices:
What We Do
What We Don’t Do
✔ Double trigger vesting provisions requiring a change in control and qualifying termination of employment
✘
No tax gross-ups in severance arrangements and change in control agreements
✔ Recoupment (“clawback”) policies covering equity and cash compensation, both time- and performance-based, of all Section 16 Officers, including in compliance with Rule 10D-1 and related NYSE listing standards
✘
Perquisites and other personal benefits are not a material part of compensation program
✔ Robust stock ownership guidelines for directors and executive officers
✘
No tax gross-ups on perquisites (other than relocation benefits)
✔ Retain independent compensation consultant
✘
No repricing or cash buyouts of options without shareholder approval
✔ Majority of compensation is at risk and tied to Company performance
✘ No dividends paid out on unvested stock awards
✔ Awards granted under the Amended and Restated 2024 Omnibus Award Plan generally require a one-year minimum vesting period
✘
No evergreen features in 2024 Omnibus Award Plan or the Amended & Restated 2024 Omnibus Award Plan
✔ Cap annual cash incentive awards at 200%
✘ No hedging or pledging of Company stock
Please see “Item 2—Advisory Vote to Approve Compensation of Named Executive Officers” for more information.
2026 proxy, filed 2026-03-06; compensation protections and proposed amended-plan provisions · Filed 06/03/2026
The shareholders approved the adoption of the Stanley Black & Decker Amended and Restated 2024 Omnibus Award Plan (the “Amended and Restated 2024 Plan”), which was approved by the Board of Directors of the Company (the “Board”) on February 24, 2026.
Annual-meeting Form 8-K, filed 2026-04-27; shareholder adoption of amended award plan · Filed 27/04/2026
The only changes to the Amended and Restated 2024 Plan are (i) the authorization of 7,750,000 additional shares for issuance under the Amended and Restated 2024 Plan; (ii) the adjustment of the fungible ratio for awards granted after effectiveness of Amended and Restated 2024 Plan to 2.71; (iii) the addition of a one-year minimum vesting period, subject to certain exceptions; and (iv) the extension of the term of the Amended and Restated 2024 Plan.
Annual-meeting Form 8-K, filed 2026-04-27; additional shares and minimum-vesting provision with exceptions · Filed 27/04/2026
Proxy access (3% / 3 years)
•
No shareholder rights (“poison pill”) plan
•
Shareholder right to act by written consent and to amend Bylaws by a majority vote
•
Shareholders representing 25% of voting power may call special meeting
•
Lead Independent Director; Non-Executive Chair, effective October 1, 2026
•
All directors are independent, other than Executive Chair and CEO
•
Non-management directors must meet at regularly scheduled Board meetings without management
•
Committed to balanced Board refreshment with mixture of short-, medium- and long-tenured directors.
2026 proxy, filed 2026-03-06; shareholder rights, director independence and scheduled Chair transition · Filed 06/03/2026
The Board also maintains effective oversight by consistently ensuring that each Board committee, other than the Executive Committee, is led by and composed entirely of independent directors.
2026 proxy, filed 2026-03-06; independent committee composition except Executive Committee · Filed 06/03/2026
Also on January 23, 2026, the Board elected Debra Crew to serve as Lead Independent Director of the Company, effective immediately.
Leadership Form 8-K, filed 2026-01-26; immediately effective Lead Independent Director appointment · Filed 26/01/2026
Proposal 1: The Company’s shareholders elected each of the following nominees as a director of the Company to serve for a term expiring at the Annual Meeting of Shareholders to be held in 2027, or until his or her successor has been duly elected and qualified, based on the following votes:
Nominee
For
Against
Abstain
Broker Non-Votes
Donald Allan, Jr.
Annual-meeting Form 8-K, filed 2026-04-27; directors elected for terms expiring at the 2027 annual meeting · Filed 27/04/2026
