Today’s Stock of the Week is a leading global consumer goods company with an impressive portfolio that recently got even bigger.
Newell Brands Inc. (NWL), which makes products found all over the home, is benefiting from a growth spurt, although it suffered some growing pains.
Among its many brands are Sunbeam, Mr. Coffee, Crockpot, Paper Mate, Sharpie, Elmer’s Glue, Yankee Candle, Rubbermaid, Coleman and Graco. The management team looks at the business as a portfolio of companies and brands. In line with that approach, Newell acquired another multibrand company, Jardan Corporation, in 2016, resulting in Newell’s revenue more than doubling last year.
Newell’s great strength is distribution. It is expert at getting a large number of products to a large number of retailers, whether bricks-and-mortar or online. Its execution has been excellent, but skepticism over the scale of the Jardan acquisition has held back the stock.
Newell did have some challenging quarters, but it has now hit its stride, reducing costs and growing internationally while improving the integration of Jardan. Newell should now resume steady growth. Revenue of $13.26 billion last year should rise to $14.7 billion this year and $14.9 billion in 2018. And the dividend of $0.92/share/yr., recently yielding 1.7%, appears secure.
Fiscal year: December. Earnings per share: 2018 est./$3.53…2017 est./$3.10…2016/$2.89.
This Weeks Expert
Dan Veru is executive vice president and co-chief investment officer at Palisade Capital Management, LLC, Fort Lee, New Jersey, which has $3.1 billion under management. PalisadeCapital.com