Bullish indicating open at $55-$60, IPO prices at $37
On Thursday, Canaccord Genuity revised its price target for Newell Rubbermaid (NASDAQ:NWL) to $11 from the previous $12, while continuing to endorse the stock with a Buy rating. The adjustment followed Newell Brands’ first-quarter earnings report, which met or slightly exceeded consensus estimates on key financial measures. The stock, currently trading at $12.64, has shown resilience with a 10.2% gain over the past year. For deeper insights into Newell’s financial health and valuation metrics, InvestingPro offers comprehensive analysis in its exclusive Pro Research Report.
Newell Brands, known for its diverse portfolio including consumer and commercial products, has maintained a relatively stable market position despite the ongoing discourse about tariffs. The company’s exposure to China sourcing in 2024 stood at 15%, with a significant portion of that being baby gear, which had been exempt during the initial round of tariffs under the Trump administration. This stability is reflected in the stock’s YTD performance, showing a 2.3% gain. Newell Brands anticipates gaining a competitive edge and emerging as a net beneficiary in the long run, despite the current tariff concerns.
The company has reiterated most of its guidance, with the exception of core sales growth projections, which have been conservatively adjusted from flat to a decline of 1% to 2%. This revision suggests a reduced likelihood of achieving core sales growth in 2025. Nevertheless, Newell Brands has seen positive core sales growth in its Learning & Development segment and International business for five consecutive quarters, indicating the effectiveness of its new strategy.
Amidst the tariff discussions, which have dominated the earnings call and influenced the stock’s year-to-date performance, Canaccord Genuity believes that Newell Brands’ long-term prospects remain promising. The company is expected to benefit as weaker competitors with single-source dependency may struggle to survive in a market affected by tariffs.
Canaccord’s revised estimates take into account the second-quarter guidance provided by Newell Brands, as well as the company’s ability to mitigate half of the anticipated $0.20 earnings per share impact from China tariffs. Trading between its 52-week range of $11.10 to $13.25, the stock has shown relative stability. This conservative approach has led to the new price target of $11, signaling a cautious yet optimistic outlook for Newell Rubbermaid’s stock performance. Discover more detailed financial metrics and expert analysis with InvestingPro’s comprehensive coverage of NWL.
In other recent news, Newell Rubbermaid’s fourth-quarter earnings results have sparked diverse reactions among analysts. The company reported earnings per share that exceeded expectations, but its initial guidance for 2025 projected slightly lower sales than anticipated. Truist Securities maintained a Buy rating with a $17 price target, highlighting the stock’s sharp decline as a potential buying opportunity. Meanwhile, UBS adjusted its price target from $10.50 to $8.00, retaining a Neutral stance due to uncertainties surrounding tariffs and macroeconomic factors. Canaccord Genuity, while reducing its price target to $14, reaffirmed a Buy rating, suggesting the market’s response was an overreaction. Citi also revised its outlook, lowering the price target to $7.75 and maintaining a Neutral stance, citing concerns about the company’s revenue forecasts amid tariff uncertainties. Despite these varied perspectives, Newell Rubbermaid’s earnings beat and its guidance have led to significant market interest and discussion.
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