Tupperware Brands Corporation
) has increased its dividend three times since 2009 and currently
pays a regular quarterly dividend that yields 2.1% annually.
Moreover, following strong third quarter results, this maker of
food storage containers and home products has been consistently
trading above $60 per share and is seeing a rise in earnings
With a solid dividend yield and an expected long term earnings
growth of 12%, this Zacks Rank #2 (Buy) appears to be a promising
pick for investors seeking both growth and income.
Healthy Beat in Q3
On Oct 24, Tupperware reported third-quarter earnings of 95 cents
per share, beating the Zacks Consensus Estimate by 6% and exceeding
last year's performance by 14%. The company enjoyed strong results
from the emerging markets of Asia-Pacific.
Revenues, however, dipped 1.4% year over year to $594.4 million due
to unfavorable currency translation impact. Excluding the currency
impact, sales rose 6% in the quarter.
Sales in Asia-Pacific climbed 10% on a reported basis to $197.5
million with strong growth registered across Indonesia (up 30%) and
India (up 50%). China and Malaysia posed double-digit growth in the
quarter. The growing middle class in the region is driving demand
for the company's storage and other products.
Tupperware, however, witnessed lower sales from Europe and North
America in the third quarter. Revenues from Latin America rose 7%
with sales from both Brazil and Venezuela surging 30% in the
Tupperware is slated to release its fourth quarter and fiscal 2012
results on Jan 29. For the fourth quarter, the company anticipates
earnings between $1.66 and $1.71 per share and expects sales growth
of 5%-7% in local currency. The Zacks Consensus Estimate for the
fourth quarter is currently pegged at $1.68.
For fiscal 2012, earnings are expected at $4.94 to $4.99 per share.
Sales growth in local currency is projected at 5% for the year. The
Zacks Consensus Estimate for the year is $4.98, well above the
The company expects sales growth between 5% and 7% in fiscal 2013.
More insight will be provided in the upcoming fourth quarter
The Zacks Consensus Estimate for 2012 is up 0.4% over the past 60
days to $4.98 per share, suggesting year-over-year growth of
The Zacks Consensus Estimate for 2013 has advanced 0.5% in that
time to $5.56 per share, reflecting year over year growth of around
Attractive Dividend Payout
Tupperware has been a consistent payer of quarterly dividends since
going public in 1996. After maintaining a steady quarterly dividend
of 22 cents per share since 1996, the company first hiked its
dividend by 14% to 25 cents per share in October 2009. Following
two subsequent hikes of 20% in Nov 2010 and Feb 2012, the dividend
currently stands at 36 cents per share. The most recent payout of
the quarterly dividend was on Dec 31, affirming a solid yield of
With a net margin of 8.1%, well ahead of other companies in the
consumer products industry such as Newell Rubbermaid Inc. (
), Energizer Holdings Inc. (
) and Kimberly-Clark Corporation (
), Tupperware has ample scope to further increase its dividend.
Tupperware's valuation looks reasonable on a P/E basis. Shares are
currently trading at a forward P/E of 12.17x, a slight discount to
the peer group average of 12.92x. Moreover, its trailing twelve
months P/E of 14.12x is a tad lower than the peer group average of
14.13x. Tupperware also has a 1-year ROE of 54.4%, which is well
above its peer group average of 22.1%, reflecting efficient capital
Tupperware's shares have bounced back sharply to $67.65 as of Jan
22, 2012 from as low as $11.40 in March 2009. The gap between
earnings estimates for 2012, 2013 and 2014 should attract
investors. As the earnings estimates move higher, the stock is
likely to follow suit. The stock has generated a year-to-date
return of 5.54%, higher than the S&P 500's return of 4.74%.
Tupperware Brands Corporation makes and distributes a range of
storage and serving solutions, kitchen cookware, microwave products
and microfiber textiles under the Tupperware brand. It also offers
beauty and personal care products as well as nutritional products
under a host of brands. The company, which has a market cap of
$3.74 billion, markets its products globally through an independent
sales force of 2.8 million.
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