Tupperware Stock Delivers Win In Small-Ball Fashion

By
A A A

Like baseball, you can win in the stock market by playing small ball or three-run homer ball.

Tupperware ( TUP ) leans to the small-ball side, meaning the company is steady and competent but seldom delivers huge earnings gains.

In the past nine years, the company posted EPS growth of 25% or more only twice -- 2004 and 2007. The average gain in the remaining seven years was 16%.


Revenue growth was big in only one of those years -- 36% in 2006. The other eight years averaged revenue growth of 6%.

Consistency also counts. On that score, Tupperware is solid.

The five-year Earnings Stability Factor is 4. The scale runs from 0 (calm) to 99 (erratic).

Income investors can find pluses in Tupperware's dividend history. The payout has more than doubled over the past six quarters, rising from 30 cents to 62 cents a share.

The current annualized yield is 3% vs. 2.4% for the S&P 500.

Should an investor buy Tupperware and hold for that 3% dividend? Not necessarily.

A more active way to play Tupperware is to book profits from a breakout at 20% or so, then sit out the next consolidation on the sidelines. A stock will often base after a 20% gain.

How would that have worked?

Tupperware sketched several possible entries, beginning in October. However, some occurred with the market in a correction or the volume inadequate.

The best recent entry was Jan. 24, when the stock drew 49% faster trade in a buy zone from a flat base. From the Jan. 24 closing price of 68.87, the stock gained 20% in less than three months.

Those who took the profit at 20% could re-enter if a new base forms and delivers a breakout.



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Personal Finance , Investing Ideas

Referenced Stocks: TUP

Investor's Business Daily

Investor's Business Daily

More from Investor's Business Daily:

Related Videos

Stocks

Referenced

67%

Most Active by Volume

39,831,331
  • $17.615 ▲ 0.48%
31,304,827
  • $112.495 ▼ 0.14%
27,393,223
  • $25.1699 ▲ 0.12%
26,399,371
  • $47.95 ▲ 0.90%
23,136,296
  • $27.71 ▲ 0.22%
22,101,980
  • $36.57 ▼ 1.22%
20,752,804
  • $6.955 ▲ 4.74%
20,143,049
  • $9.4534 ▼ 6.12%
As of 12/19/2014, 11:22 AM


Find a Credit Card

Select a credit card product by:
Select an offer:
Search
Data Provided by BankRate.com