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Tupperware Brands Corporation (TUP - Snapshot Report) recently reported third quarter earnings that beat the Zacks Consensus Estimate by 10%. Management raised guidance following the solid quarter, prompting analysts to raise their estimates.

Tupperware parties are becoming increasingly popular around the globe, as nearly 60% of company sales comes from emerging markets.

The company also recently increased its dividend for the first time and valuation remains reasonable.

Third Quarter Results

On October 19, Tupperware reported third quarter earnings per share was $0.64, beating the Zacks Consensus Estimate by 10%. It was a 19% increase in EPS year-over-year.

Total sales increased 2% over the same quarter in 2009. Sales growth was particularly strong in the emerging markets, which saw a 9% increase year-over-year. Sales growth was exceptionally strong in India, which grew 62%. Tupperware parties appear to be popular in Mumbai.

This growth was mostly offset by double-digit sales declines in Australia and Japan. Sales in North America were down 1% reflecting the tough economic climate.

The gross margin was 66.2%, down slightly from 66.5% in the same quarter in 2009. The operating margin improved, however, from 10.7% to 11.8% over the same period.

Outlook

In the third quarter press release, management stated that it expects sales growth of 8% to 9% for the full year 2010. It also expects earnings per share in the range of $3.60 to $3.65. This is up from previous guidance of $3.51 to $3.61.

Estimates have been trending higher since the company raised its guidance, prompting an upgrade to a Zacks #2 Rank (Buy) stock. The Zacks Consensus Estimate for 2010 is $3.62, corresponding to 18% growth over 2009 EPS.

The 2011 estimate is currently $4.15, representing 15% annual growth.

The company also gave guidance for the fourth quarter between $1.26 and $1.31. The Zacks Consensus Estimate is within this range at $1.29.

Tupperware Brands has beaten the Zacks Consensus Estimate in 16 of the last 17 quarters.

TUP: Tupperware Brands Corporation

Dividend

Tupperware has consistently paid a dividend since 1996. It kept its quarterly dividend steady at $0.22 per share before finally raising it to $0.25 per share in December 2009.

It currently yields 2.1%.

Fundamentals

The valuation pictures looks very reasonable for Tupperware Brands. Shares are trading at 13.1x forward earnings, a slight discount to the industry average of 13.8x. Its PEG ratio is 1.1.

Return on investment is very strong at 21.3%. That's almost triple the industry average of 7.2%.

The company was founded in 1946 and is headquartered in Orlando, Florida.

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