Stanley Black & Decker, Inc

Kalkine’s Global Tariff Report provides fully independent analysis and data-driven analysis of major global sectors affected by tariff changes, evaluating the implications these shifts may have on equity valuations across those industries. The report concentrates on trade-sensitive sectors that typically experience heightened investor scrutiny during periods of tariff uncertainty. It also identifies defensive and countercyclical segments that demonstrate relative resilience or may even outperform, amid disruptions to global trade flows.

As illustrated in the table below, several key sectors in different countries are directly impacted by the recent tariff announcement from President Trump.

Latest Updates on Global Tariffs by Trump’s Administration

Key Developments (as of September 02^nd, 2025) 

Canada

• For Canada, President Trump’s executive order on July 31, 2025, raised tariffs on imports from approximately 25% to 35% effective August 1, prompting Canada to drop retaliatory tariffs on U.S. goods under USMCA starting September 1, though maintaining 25% tariffs on autos, steel, and aluminum, preserving over 85% tariff-free trade coverage.
• Canada’s response: Starting September 1, Canada will drop its retaliatory tariffs on U.S. goods covered under USMCA, aligning with U.S. exemptions, but will keep ~25% tariffs on autos, steel, and aluminum. Canada is easing trade tensions, dropping its broader list of retaliatory tariffs but holding onto those targeting heavy industry.
• Trade coverage: Over ~85% of Canada–US trade remains tariff-free, due to USMCA provisions.

India

• India faces an escalated tariff regime with an additional 25% imposed on August 27, 2025, bringing the total to 50% on USD 48.2 billion of exports due to its Russian oil imports
• Scope: Around USD ~48.2 bn of Indian goods exported to the US will be subject to this full ~50% tariff.
• Strategic pushback: India is thawing relations with China and moving toward greater regional autonomy. Meanwhile, Vice President Vance confirmed the tariff applies “secondary tariffs” to pressure Russia economically.

China

• On August 11, the U.S. extended its tariff truce with China for another 90 days, blocking any sudden increase to previously threatened levels (~145%). The suspension lasts until November 10, 2025.
• Chinese goods still face the temporary ~30% tariff, until November 10, 2025, avoiding a threatened 145% hike. 

European Union

• Deal outline: As of August 21, the U.S. and EU agreed to a cap, a total tariff (MFN + reciprocal + Section 232 where applicable) won’t exceed ~15% on most EU-origin goods. Certain sectors (like autos, semiconductors, pharmaceuticals, lumber) are specifically included.
• Cars and quotas: The US will maintain a ~27.5% tariff on European cars and parts until the EU passes legislation lowering its own tariffs on American goods.
• Most EU goods will now face a flat ~15% maximum tariff under the new framework.

What are the different types of Tariffs?

A Snapshot of USA’s Trade Size

In June 2025, the United States recorded total exports valued at USD 277.0 billion, comprising USD 178.0 billion in goods exports and USD 99.0 billion in service exports, while total imports reached USD 337.0 billion, resulting in a trade deficit of USD 60.0 billion, consistent with recent trends of import-heavy trade dynamics. The modest growth in service exports, which constitute approximately 35.7% of total exports, reflects a resilient digital and financial services sector, potentially bolstered by domestic innovation and global demand, though this was insufficient to offset the 52.8% dominance of goods imports. This imbalance underscores ongoing challenges in manufacturing competitiveness and reliance on foreign goods, suggesting that while service-led growth provides a buffer, strategic measures to enhance goods export capacity or mitigate import costs—such as tariff adjustments—may be critical to narrowing the deficit in the medium term. 

Impact of US Tariffs on Various Sectors

The U.S. economy is currently grappling with significant challenges, including high inflation, supply chain disruptions, and the effects of aggressive monetary policy from the Federal Reserve. Key sectors such as manufacturing, agriculture, and technology are feeling strain, particularly due to their dependence on global supply chains and export markets, with trade policies like tariffs on steel, aluminum, and electronics driving up costs for businesses and consumers alike. Despite these pressures, there’s cautious optimism in some quarters about market stabilization within the next year, though this is tempered by ongoing issues like labor shortages, energy price volatility, and political divisions. The Federal Reserve’s interest rate hikes aimed at curbing inflation—still above target levels—have slowed economic growth, raising recession risks, while strategic efforts such as trade agreements and supply chain diversification remain critical to fostering stability and mitigating prolonged uncertainty across these vital sectors.

Why does the US Industrial Machinery & Equipment Industry look Attractive Amid Tariff Concerns?

Amid elevated Market Volatility and Tariff pressures, Stanley Black & Decker Inc (NYSE: SWK) stands out as our defensive pick within the Industrial Machinery Industry, supported by rigorous fundamental and technical research

Kalkine’s Global Tariff Report covers the Investment Highlights, Key Financial Metrics, Risks, Technical Analysis along with the Valuation, Target Price, and Recommendation on Stanley Black & Decker Inc (SWK). 

Section 1: Company Overview and Fundamental Insights

1.1   Company Overview:

Stanley Black & Decker, Inc. (NYSE: SWK) engages in the provision of power and hand tools, and related accessories, products, services and equipment for oil and gas, infrastructure applications, commercial electronic security and monitoring systems, healthcare solutions, and mechanical access solutions. It operates through the Tools and Outdoor and Industrial segments. 

1.2   The Key Positives, Negatives, Investment Highlights and Risks

1.3 Top 10 Shareholders:

The top 10 shareholders together form ~50.65% of the total shareholding, indicating concentrated holding. The Vanguard Group, Inc. and Capital Research Global Investors hold a maximum stake in the company at ~­­­12.03% and ~8.17%, respectively.

1.4 Key Metrics:

Stanley Black & Decker (NYSE: SWK) exhibited a mixed financial performance in the second quarter of fiscal 2025 compared to the same period in 2024, with gross profit margin contracting from 29.19% to 27.54% due to a 3-point tariff impact and lower volumes, though mitigated by supply chain efficiencies, while EBITDA margin improved from 7.38% to 8.10% and operating margin rose from 3.52% to 4.80%, reflecting effective cost discipline and pricing adjustments. Income before tax margin turned positive to 0.68% from a negative 0.50%, and net margin surged from -0.48% to 2.58%, driven by a favorable tax settlement and operational improvements, indicating a recovery in profitability despite external pressures. However, trailing twelve-month (TTM) free cash flow yield declined from 8.32% to 4.03% and return metrics improved significantly with return on average common equity rising from -2.97% to 5.38% and return on average total assets increasing from -1.14% to 2.13%, suggesting enhanced capital efficiency but potential liquidity constraints, necessitating cautious optimism as the company navigates tariff challenges and pursues long-term margin expansion.

Section 2: Business Updates and Financial Highlights

2.1 Recent Updates: The below picture gives an overview of the company’s recent activities, such as an announcement regarding dividend distribution.

2.2 Insights into Q2FY25 Financial Performance:

Section 3: Key Risks, Company Outlook:

Section 4: Stock Recommendation Summary:

4.1 Price Performance and Technical Summary:

• NKE has generated a return of approx. 10.54% in past three months. On the other hand, a correction of approx. 17.14% in past six months.
• The stock is around the lower end of its 52-week range of USD110.18 and 52-week low price of USD 53.91. Post the announcement of Q2FY25 revenue results the stock has corrected by almost 4.11%, with the current price near an important support level of USD65.00-USD 70.00.
• The price is currently trading between its long-term (200-day) SMA and its short-term (50-day) SMA, with the current RSI of 47.45.

4.2 Fundamental Valuation

Valuation Methodology: Price/ Earnings Per Share Multiple Based Relative Valuation (Illustrative)

Note 1: Past performance is not a reliable indicator of future performance.

Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels as on September 02, 2025. The reference data in this report has been partly sourced from REFINITIV.

Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.

Note 4: Dividend Yield may vary as per the stock price movement. 

Note 5: Kalkine reports are prepared based on the stock prices captured either from REFINITIV or Trading View. Typically, REFINITIV or Trading View may reflect stock prices with a delay which could be a lag of 25-30 minutes. There can be no assurance that future results or events will be consistent with the information provided in the report. The information is subject to change without any prior notice.

Technical Indicators Defined: -

Support: A level at which the stock prices tend to find support if they are falling, and a downtrend may take a pause backed by demand or buying interest.

Resistance: A level at which the stock prices tend to find resistance when they are rising, and the uptrend may take a pause due to profit booking or selling interest.

Stop-loss: In general, it is a level to protect further losses in case of any unfavorable movement in the stock prices.