The stock market got out to a mixed start on Tuesday morning, as major market indexes didn't make consistent moves in any one direction. With plenty of uncertainty concerning what the Federal Reserve is likely to do this week with interest rates, it's understandable why so many market participants seem unready to make major commitments with their money.
Yet with earnings season underway, plenty of companies are seeing their shares make significant moves. Both Logitech International (NASDAQ: LOGI) and Sherwin-Williams (NYSE: SHW) gave their respective shareholders positive news on Tuesday morning, and that could help give the entire market a lift.
Logitech looks to bounce back
Shares of Logitech International were up 12% in morning trading on Wall Street. The maker of computer camera equipment and peripherals reported its fiscal first-quarter financial results for the period ended June 30. Although they continued to reflect weakness in that market, Logitech was still able to generate some optimism about what the future will bring.
The company's quarterly numbers were not pretty. Revenue of $974 million was down 16% year over year. Net income sagged 38% to $62.7 million, and even after adjusting for certain items, adjusted earnings of $0.65 per share were still down 12% from year-ago levels.
Just about all of Logitech's categories were weak, with sales of keyboards, video collaboration equipment, webcams, and headsets all falling 20% or more over the past year. The gaming segment also suffered an 11% drop in sales, and mouse and trackball pointing equipment held up well but still saw sales decline 5%.
However, Logitech gave more favorable guidance. The company now sees sales for the first half of fiscal 2024 coming in at $1.875 billion to $1.975 billion, up $75 million from previous projections. That would still be a decline of 14% to 19%, but any signs of improvement are good news for Logitech shareholders after the drubbing that the stock has taken lately.
Sherwin-Williams paints a pretty picture
Elsewhere, shares of Sherwin-Williams were up between 4% and 5% Tuesday morning. The paint and home-improvement products retailer reported second-quarter financial results that were encouraging for shareholders.
Sherwin-Williams' numbers were indeed impressive. Net sales were up more than 6% year over year to $6.24 billion, setting a new record for the company. Net income grew at a much faster pace of 39% from year-ago levels, and the $3.07 per share that Sherwin-Williams earned was above what most of those following the stock had expected to see.
The company attributed the strength to several different factors. In the paint stores division, Sherwin-Williams said that protective coatings saw double-digit percentage growth, as did products for marine use and commercial and property maintenance. Despite weakness in new residential sales, the consumer-brands group experienced much better sales growth in Latin America and Europe. Strength in Sherwin-Williams' automotive refinish business helped bolster performance coatings sales gains.
As a result of its good performance, Sherwin-Williams boosted its full-year guidance for 2023. It now expects earnings of between $8.46 and $8.86 per share. Moreover, as its restructuring plans continue apace, Sherwin-Williams could continue to see share-price gains as the housing market adjusts to higher interest rates and still sees long-term demand for homes at high levels.
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Dan Caplinger has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Logitech International. The Motley Fool recommends Sherwin-Williams. The Motley Fool has a disclosure policy.
