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Will Newell Brands' Strategic Efforts Help Boost the Stock?
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Newell Brands Inc. (NWL - Free Report) seems to be riding on its Growth Game Plan, Project Renewal Program and stellar earnings history. Shares of this Zacks Rank #2 (Buy) company gained 3.8% over the past one year against the Zacks categorized Consumer Products – Miscellaneous Staples industry’s decline of 1.9%.
Newell Brands’ Project Renewal Program remains on track and it expects annual cost savings from this program to be nearly $700 million by end of 2017 or beginning of 2018. Management intends to use a major portion of the savings to accelerate growth by investing in business, while the remaining cost savings are expected to reflect in earnings.
Regarding the company’s latest Growth Game Plan, management announced a host of changes in a bid to strengthen its portfolio. In this context, Newell Brands declared plans to transform itself from a holding company to an operating company with fresh investment plans and new ideas for its combined portfolio with Jarden Corp.
In fact, Newell Brands has been gaining from its various strategic efforts like solidifying portfolio and simplifying operating structure, under the Growth Game Plan. Evidently, it acquired Smith Industries and Sistema Plastics; sold major Tools business brands; and agreed to sell its Teutonia baby stroller, Pine Mountain and Diamond businesses of late.
Newell Brands also appears compelling from the earnings perspective. Notably, the company has recorded earnings beat in 18 of the past 20 quarters, with an average of 6.2% in the trailing four quarters.
Further, normalized earnings per share for 2017 are now expected in the range of $2.95−$3.15 compared with $2.85–$3.05, guided earlier. Also, the Zacks Consensus Estimate for the first quarter and 2017, which has been stable over the last 30 days, is currently pegged at 29 cents and $3.04, respectively.
However, significant global presence exposes the company to currency woes. Further, macroeconomic uncertainty and volatile consumer behavior remain concerns.
Still, we believe that Newell Brands has the potential to efficiently overcome these hurdles by capitalizing on its growth drivers. This makes the company an investors’ favorite. Also, its VGM Score of “A”, along with a long-term earnings growth rate of 12% raises optimism in the stock.
Other Stocks You May Consider
Other stocks worth considering in the same industry include Ollie's Bargain Outlet Holdings, Inc. (OLLI - Free Report) , Blue Buffalo Pet Products, Inc. (BUFF - Free Report) and Energizer Holdings, Inc. (ENR - Free Report) .
Ollie's Bargain Outlet with a long-term earnings growth rate of 17.1% has surged 31.2% in the past one year. The stock sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Blue Buffalo Pet, which carries a Zacks Rank #2, has a long-term earnings growth rate of 13%.
Energizer, a Zacks Rank #2 stock, has jumped nearly 33% in the past one year. Also, it has a long-term earnings growth rate of 9.5%.
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Will Newell Brands' Strategic Efforts Help Boost the Stock?
Newell Brands Inc. (NWL - Free Report) seems to be riding on its Growth Game Plan, Project Renewal Program and stellar earnings history. Shares of this Zacks Rank #2 (Buy) company gained 3.8% over the past one year against the Zacks categorized Consumer Products – Miscellaneous Staples industry’s decline of 1.9%.
Newell Brands’ Project Renewal Program remains on track and it expects annual cost savings from this program to be nearly $700 million by end of 2017 or beginning of 2018. Management intends to use a major portion of the savings to accelerate growth by investing in business, while the remaining cost savings are expected to reflect in earnings.
Regarding the company’s latest Growth Game Plan, management announced a host of changes in a bid to strengthen its portfolio. In this context, Newell Brands declared plans to transform itself from a holding company to an operating company with fresh investment plans and new ideas for its combined portfolio with Jarden Corp.
In fact, Newell Brands has been gaining from its various strategic efforts like solidifying portfolio and simplifying operating structure, under the Growth Game Plan. Evidently, it acquired Smith Industries and Sistema Plastics; sold major Tools business brands; and agreed to sell its Teutonia baby stroller, Pine Mountain and Diamond businesses of late.
Newell Brands also appears compelling from the earnings perspective. Notably, the company has recorded earnings beat in 18 of the past 20 quarters, with an average of 6.2% in the trailing four quarters.
Further, normalized earnings per share for 2017 are now expected in the range of $2.95−$3.15 compared with $2.85–$3.05, guided earlier. Also, the Zacks Consensus Estimate for the first quarter and 2017, which has been stable over the last 30 days, is currently pegged at 29 cents and $3.04, respectively.
However, significant global presence exposes the company to currency woes. Further, macroeconomic uncertainty and volatile consumer behavior remain concerns.
Still, we believe that Newell Brands has the potential to efficiently overcome these hurdles by capitalizing on its growth drivers. This makes the company an investors’ favorite. Also, its VGM Score of “A”, along with a long-term earnings growth rate of 12% raises optimism in the stock.
Other Stocks You May Consider
Other stocks worth considering in the same industry include Ollie's Bargain Outlet Holdings, Inc. (OLLI - Free Report) , Blue Buffalo Pet Products, Inc. (BUFF - Free Report) and Energizer Holdings, Inc. (ENR - Free Report) .
Ollie's Bargain Outlet with a long-term earnings growth rate of 17.1% has surged 31.2% in the past one year. The stock sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Blue Buffalo Pet, which carries a Zacks Rank #2, has a long-term earnings growth rate of 13%.
Energizer, a Zacks Rank #2 stock, has jumped nearly 33% in the past one year. Also, it has a long-term earnings growth rate of 9.5%.
Zacks’ Best Private Investment Ideas
While we are happy to share many articles like this on the website, our best recommendations and most in-depth research are not available to the public. Starting today, for the next month, you can follow all Zacks' private buys and sells in real time. Our experts cover all kinds of trades… from value to momentum . . . from stocks under $10 to ETF and option moves . . . from stocks that corporate insiders are buying up to companies that are about to report positive earnings surprises. You can even look inside exclusive portfolios that are normally closed to new investors. Click here for Zacks' private trades >>