Newell Brands (NWL) - My "beat down" stock buy
Newell Brands
Why:
- It is "beat down" ... 48% off of its 52 week high
- Low P/E ratio
- I expect my first dividend of $ 23. in mid-March
- I like the brands
- My investment horizon for this is at least 52 weeks.
- Basically the return beats the yield on my savings account
Starboard to Launch Proxy Fight to Oust Entire Newell Brands Board https://t.co/K3Le2S2zoE via @WSJ
— James Peet (@jrpeet) February 12, 2018
Starboard's Smith: No Newell Divestitures Until Proxy War Concludes https://t.co/igsYoo0qQG via @TheStreet
— James Peet (@jrpeet) February 12, 2018
The Starboard letter to the $NWL boardhttps://t.co/bNXfSv8tl2 pic.twitter.com/iPlqagcgXh
— James Peet (@jrpeet) February 12, 2018
This is positive:Newell is being pressured by weak sales amid activist calls for changes https://t.co/BPNkOtLjU8 via @WSJ
— James Peet (@jrpeet) February 16, 2018
Newell (NWL) Beats on Q4 Earnings & Sales, Retains FY18 View https://t.co/UaStChPba8 via @YahooFinance
— James Peet (@jrpeet) February 16, 2018
Newell strikes deal with Carl Icahn to fend off other activists https://t.co/S0cv2JnOcW via @WSJ
— James Peet (@jrpeet) March 19, 2018
The Starboard letter today is interesting:
ReplyDeleteNewell’s product portfolio consists of many iconic and valuable franchises, representing marketleading
brands that operate in both niche and large, growing and unconsolidated global categories.
We believe that Newell is deeply undervalued and that significant opportunities exist to create
value for the benefit of all shareholders – opportunities that should be well within the control of
management and the Board of Directors (the “Board”).
Unfortunately, Newell’s recent operating and financial performance have fallen well below both
the expectations set by the Board and the Company’s true potential. Within the last six months,
the Company has reduced its 2017 financial guidance three times following continuous
underperformance in both revenue and profitability. This has resulted in extremely poorshare price
performance, and Newell has drastically underperformed both its industry peers and the overall
market. In fact, since the closing of the Jarden acquisition, Newell’s stock price has declined by
over 42% while the S&P 500 has increased by over 41%, resulting in cumulative
underperformance of approximately 84%. This massive share price underperformance has resulted
in Newell trading at less than 10x 2018 EPS, both a multi-year low and a substantial discount to
its peers and the broader market. Furthermore, since July 1, 2017, Newell’s stock price has
declined by over 53% while the S&P 500 has increased by over 18%, resulting in
underperformance of approximately 72%.
So you bought about 25 shares?
ReplyDelete100
DeleteJim, I bought a beat down stock yesterday too. It would be fun to have a contest to see who made the better buy. :) Mine is already down today, so I'm already embarrassed to mention what it was.....But I think it can come back.
ReplyDelete