Stanley Black & Decker Raises Dividend 1.2% to $0.84

Stanley Black & Decker increased its quarterly dividend 1.2% to $0.84 a share from $0.83, lifting the annual dividend to $3.36. The increased payment carried an ex-dividend date of September 8, 2026. It is an ordinary quarterly increase, not a special distribution.

Why the dividend changed

The board’s dividend announcement disclosed the new rate but did not give a detailed explanation for the increase. The surrounding financial context is stronger cash generation, lower debt and greater capital-allocation flexibility after the company sold its Consolidated Aerospace Manufacturing business.

Stanley Black & Decker reported second-quarter net sales of $4.0 billion, unchanged year over year but up 3% organically. Free cash flow was $698 million, while gross margin expanded to 33.0%, helped by productivity, product mix and tariff refunds. During the quarter, the company reduced debt by $1.7 billion and repurchased $250 million of stock. Chief Financial Officer Patrick Hallinan said the CAM sale strengthened the company’s finances, “affording the ability to invest in growth, reduce debt, support the dividend, and repurchase our shares.” Stanley Black & Decker second-quarter results

Management also raised its 2026 adjusted earnings guidance to a range of $5.20 to $5.80 and its free-cash-flow guidance to $600 million to $800 million. The tariff refund contributed to the stronger outlook, while taxes and fees associated with the CAM divestiture remained a cash-flow consideration. The modest dividend increase therefore came alongside improving operating results and balance-sheet capacity, but also substantial competing uses for cash.

Dividend track record

The increase extends Stanley Black & Decker’s dividend-growth streak to 40 consecutive years. Dividend growth has averaged 3.5% annualized over five years, although the recent pattern shows that increases have become smaller.

Annual payments rose from $2.78 a share in 2020 to $2.98 in 2021 and $3.18 in 2022. The annual increase then slowed to 1.3% in 2023, when payments totaled $3.22, followed by increases of 1.2% to $3.26 in 2024 and 1.2% to $3.30 in 2025. The new quarterly rate continues that progression but does not restore the faster growth recorded earlier in the period.

The payment history shows the quarterly rate at $0.82 on June 3, 2025, $0.83 on September 2, 2025, and $0.84 on September 8, 2026. That sequence indicates a policy of small annual step-ups rather than larger or more frequent adjustments.

Is the dividend covered?

The dividend consumes 81% of earnings. That means most reported profit is being distributed, leaving a narrower earnings cushion than a lower payout ratio would provide. Continued earnings and cash-flow execution therefore matter to maintaining coverage.

SmarterDividends rates the dividend A with a safety score of 95. That grade denotes a very safe dividend, within the score range of 80 to 100. It weighs the broader capacity to sustain payments more favorably than the earnings payout ratio alone.

The latest operating report provides additional context without replacing the payout measures. Second-quarter free cash flow and the higher full-year cash-flow guidance show that the company was generating cash while funding debt reduction, share repurchases and the dividend. Investors will still need to separate recurring operating improvement from the benefit of tariff refunds when assessing future coverage.

Yield and valuation

At a share price of $90.60, the annual dividend of $3.36 produces a forward yield of 3.66%. That compares with a 1.61% median forward yield for the Industrials sector, giving SWK a higher income rate than the sector benchmark.

SmarterDividends estimates fair value at $89.69 and classifies the shares as fairly valued, with 0% upside to fair value. The current price and fair-value estimate are therefore closely aligned, while the yield remains the clearer point of distinction from the sector median.

What to watch

Stanley Black & Decker plans to report third-quarter results on November 4, 2026. The release will provide the next update on organic demand, margins, free cash flow, debt reduction and the company’s raised guidance. Third-quarter earnings schedule

Portfolio changes also remain important. The company has agreed to sell Excel Industries, its Hustler-branded mower business, subject to regulatory approval and customary closing conditions. Management said the transaction is intended to concentrate resources on larger brands and is not expected to dilute adjusted earnings per share. Excel Industries sale announcement

Capital spending will compete with shareholder distributions. Stanley Black & Decker plans to invest $1 billion in the United States through 2028, split approximately equally between research and development and capital expenditures or other long-term manufacturing investments. Progress on that program, the Excel sale and cash-flow guidance will show how management balances growth investment with debt reduction, repurchases and the dividend. U.S. investment announcement