Newell Stock Drops 30% in a Month: Is It Still Worth Your Money?

Core Viewpoint - Newell Brands Inc. (NWL) stock has experienced a significant decline of 30.4% over the past month, underperforming the broader industry and the Consumer Staples sector, primarily due to weaker-than-expected fourth-quarter 2024 results [1][3]. Financial Performance - Revenues for Newell declined by 6.1% year over year, missing the Zacks Consensus Estimate [1]. - Core sales decreased by 3%, attributed to lower demand, business exits, and unfavorable foreign exchange impacts [3]. - The Home & Commercial Solutions segment saw a net sales decline of 7.7% year over year, with core sales dipping 4.6% due to weakness in the Kitchen and Home Fragrance businesses [4]. - The Learning and Development segment experienced a 1.1% decline, while the Outdoor and Recreation segment posted a net sales decline of 7.9% [5]. Strategic Initiatives - Newell has implemented strategic pricing actions in international markets to mitigate inflation and currency pressures, positively impacting core sales [6]. - The company is executing a new corporate strategy focused on innovation, brand-building, and operational efficiency through standardization and scale [8]. - Newell's organizational realignment aims to enhance commercial capabilities and improve consumer insights and brand communication [10]. Margin Improvement - Newell's normalized gross margin expanded by 330 basis points year over year to 34.6%, marking the sixth consecutive quarter of improvement [7]. - The normalized operating margin increased by 70 basis points to 7.1%, indicating progress in operational efficiency and cost management [7]. Future Outlook - For 2025, Newell anticipates a sales decline of 2-4% year over year, with core sales expected to decline by 2% to increase by 1% [12]. - The company projects normalized EPS to be between 70-76 cents, an increase from 68 cents reported last year [12]. - Analysts have revised downwards the EPS estimates for 2025 and 2026 by 3.8% and 7.5%, respectively, but still suggest year-over-year increases [13].