Newell Brands Q4 Earnings Around the Corner: What Awaits the Stock?

Core Insights - Newell Brands Inc. (NWL) is anticipated to experience a year-over-year revenue decline of 3.3% in Q4 2025, with expected revenues of $1.89 billion [1] - The consensus estimate for earnings per share (EPS) is 18 cents, reflecting a growth of 12.5% compared to the previous year [2] Revenue and Earnings Expectations - The consensus estimate for quarterly revenues is $1.89 billion, indicating a decline of 3.3% from the same quarter last year [1] - The bottom line is expected to show growth, with an EPS estimate of 18 cents, which is a 12.5% increase year-over-year [2] Factors Influencing Q4 Results - Newell Brands is facing challenges due to a turbulent macroeconomic environment affecting consumer sentiment and discretionary spending, with persistent inflation and geopolitical volatility impacting growth [3] - Management has projected net sales to decline by 1-4% and core sales to decrease by 3-5%, with a normalized operating margin expected between 9% and 9.5% [4][10] Segment Performance - International operations are expected to return to growth as macroeconomic conditions stabilize, particularly in markets like Brazil and Argentina [5] - The Outdoor & Recreation segment is showing early signs of stabilization, although net sales are projected to decrease by 4% for the fourth quarter [6] Profitability and Cost Management - Profitability is likely to improve due to ongoing simplification and productivity initiatives, with normalized overheads as a percentage of sales expected to decline [7] - Investments in technology, including AI-enabled tools, are anticipated to enhance operational efficiency [7] Strategic Initiatives - Newell Brands is reducing reliance on China sourcing and expanding U.S. manufacturing, which strengthens supply chain resilience and competitive positioning [8] - The company is optimistic about stabilizing near-term performance due to positive net distribution and increased innovation and marketing support [8] Valuation Perspective - Newell Brands is trading at a forward 12-month price-to-earnings ratio of 7.64X, significantly below its five-year high of 16.88X and the industry average of 18.72X, presenting an attractive investment opportunity [12] Stock Performance - Over the past three months, NWL shares have increased by 31.8%, outperforming the industry growth of 3.6% [14]