Newell Brands Inc. NWL is expected to register year-over-year declines in the bottom and top lines when it reports third-quarter 2024 results on Oct. 25, before the opening bell. The Zacks Consensus Estimate for quarterly revenues is pegged at $2 billion, indicating a drop of 4.3% from the figure reported in the year-ago quarter.
The consensus estimate for the bottom line is pegged at 16 cents per share, which indicates a year-over-year plunge of 59%. The consensus mark has been unchanged in the past 30 days.
In the last reported quarter, the Atlanta, GA-based company delivered an earnings surprise of 71.4%. It has delivered an earnings surprise of 67.6%, on average, in the trailing four quarters.
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Key Factors to Note About NWL
Newell has been witnessing a challenging macroeconomic environment and elevated levels of core inflation that have led to muted demand for discretionary and durable products. In addition, soft global demand and macroeconomic impacts from geopolitical conflicts have been acting as deterrents. Foreign currency translations are expected to have been headwinds. This, coupled with softness in NWL’s in the Outdoor & Recreation segment, is likely to have hurt the company’s performance during the quarter under review.
Management, in its lastearnings call had expected net sales to dip in the range of 4-6%, with core sales in the band of flat to 2% drop for third-quarter 2024. The company had envisioned normalized earnings per share to be in the range of 14-17 cents, down from 39 cents in the year-earlier quarter. Our model expects a net sales drop of 12.5% in the Outdoor & Recreation segment.
However, Newell has been making strategic moves to maneuver a tough operating landscape. The company’s front-end commercial capabilities, mainly innovation and new business development, coupled with a more streamlined organizational structure, appear encouraging. Newell has also been accelerating productivity and pricing actions. This, coupled with pricing across the international markets to offset inflation and currency fluctuations, is likely to have somewhat cushioned its performance during the quarter under review.
What the Zacks Model Unveils
Our proven model does not conclusively predict an earnings beat for Newell this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that is not the case here. You can uncover the best stocks before they are reported with our Earnings ESP Filter.
Newell currently has an Earnings ESP of 0.00% and a Zacks Rank of 3.
Newell Brands Inc. Price and Consensus
Newell Brands Inc. price-consensus-chart | Newell Brands Inc. Quote
Valuation Picture of NWL Stock
From a valuation perspective, Newell offers an attractive opportunity, trading at a discount relative to historical and industry benchmarks. With a forward 12-month price-to-earnings ratio of 10.41x, which is below the five-year high of 16.88x and the Consumer Products - Staples industry’s average of 18.79x, the stock offers compelling value for investors seeking exposure to the sector.
However, the recent market movements show that NWL shares have gained 15.5% in the past six months compared with the industry's 11.4% growth.
Stocks With the Favorable Combination
Here are some companies, which according to our model, have the right combination of elements to beat on earnings this reporting cycle.
Clorox CLX currently has an Earnings ESP of +2.41% and a Zacks Rank of 2.You can see the complete list of today’s Zacks #1 Rank stocks here.
The company is likely to register bottom and top-line growth when it reports first-quarter fiscal 2025 numbers. The Zacks Consensus Estimate for Clorox’s quarterly revenues is pegged at $1.62 billion, which indicates an increase of 17.2% from the figure reported in the prior-year quarter.
The consensus estimate for quarterly earnings has increased a penny in the past 30 days to $1.36 per share, which indicates growth of 177.6% from the year-ago quarter’s level. CLX has a trailing four-quarter earnings surprise of 122.9%, on average.
Colgate CL presently has an Earnings ESP of +0.96% and a Zacks Rank of 3. The company is expected to register bottom and top-line growth when it reports third-quarter 2024 results. The Zacks Consensus Estimate for quarterly revenues is pegged at $5 billion, indicating a rise of 1.9% from the figure reported in the prior-year quarter.
The consensus estimate for quarterly earnings has remained unchanged at 88 cents per share in the past 30 days. The consensus mark for CL’s earnings indicates growth of 2.3% from the year-ago quarter’s reported number. CL has delivered an earnings surprise of 4.8%, on average, in the trailing four quarters.
Monster Beverage MNST currently has an Earnings ESP of +0.13% and a Zacks Rank of 3. The company is expected to register bottom and top-line growth when it reports third-quarter results. Although the Zacks Consensus Estimate for MNST’s quarterly earnings has moved down a penny in the last seven days to 42 cents per share, the estimate indicates 2.4% growth from the year-ago quarter's number.
The consensus estimate for Monster Beverage’s quarterly revenues is pegged at $1.92 billion, indicating a rise of 3.2% from the figure reported in the prior-year quarter. MNST reported a negative earnings surprise of 3.4%, on average, in the trailing four quarters.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
