Sherwin-Williams Company (SHW)

In a market downturn like we've seen you have to look at yield. Sherwin Williams has an excellent dividend yield on their common stock. It's a dividend that can continue to be paid too, unlike many companies who are cutting their dividends now.

The drop in oil prices from $140/barrel in Q2-3 to below $50/barrel by EOY 2008 should be positive for margins for Q 1 2009.

Sherwin-Williams' shrinking exposure to the housing market: In the past year, Sherwin-Williams has acquired paint and coatings companies in India, Uruguay and Mexico. Recently, Sherwin announced that it has signed a definitive agreement to acquire the Liquid Coatings Subsidiaries of Inchem Holdings of Inchem Holdings International Limited headquartered in Singapore. CEO Christopher M. Connor said “this acquisition reaffirms our commitment to growing globally through organic growth accelerated by strategically important acquisitions. Pointing to the fact that the US housing market is not the overwhelming driver of earnings at the company, despite what the market thinks. Every few months Sherwin does a deal that further shrinks its exposure to the US housing market, which allows it to buck the trend of “housing stocks” in the US.