Okay, let’s dive into the wild world of Newell Brands — ever heard of them? Probably not, but you’ve def got some of their stuff cluttering your house. Think Rubbermaid containers you can never find the lids for, Sharpie markers hiding in every drawer, that Yankee Candle you bought during a sale but never light. Yeah, those guys. They’re swimming in brands that rake in around 90% of a hefty $7.6 billion a year just selling to folks like us.
Now, if you’ve ever peeked at Newell’s stock, you’ve seen it’s got more ups and downs than a caffeinated squirrel in a trampoline park. Late 2023, it soared to $11.50, like twice, and then nosedived to beneath $5. Yikes. You’d think they’d be in panic mode, right? But maybe it’s just on sale, like, clearance aisle levels, or maybe it’s the metaphorical broken toy car in the pile of shiny things.
Despite face-planting with stocks, they’ve had tiny wins in the grand scheme. End of 2024, gross margins — fancy speak for profit after costs — climbed to 34.2% from 29.9% the year before. Six quarters of improvement in a row, not too shabby.
EBITDA — that’s Earnings Before Interest, Taxes, Depreciation, and Amortization if you’re not sweating over financial details—hit $900 mil, up 15%. Leverage ratio dropped, aka they owe less compared to what they’ve got, from 5.8x to 4.9x. Means they’re paying off debts and not blowing cash on stuff they can’t afford, props to the folks managing this ship for keeping it afloat.
Management’s spinning all sorts of plates: reviving top brands, making their products hit new places faster, and trimming down the supply chain fat. Fiscal gymnastics for sure, and they even juggled $1.25 billion in refi-ed debt in late 2024. Investors giving a thumbs up there.
Now, let’s whip out The Value Meter™. When you crunch Newell through it, something funky happens. The enterprise value-to-net asset value ratio’s chilling at 2.48, way below the average of 5.72. Could mean they’re undervalued, a diamond in the rough maybe?
But then, free cash flow throws a wrench in things. Positive cash flow in only half of the recent quarters, barely hitting 1.97% against net assets. Better than hitting negative with a whopping -0.70% average for other laggard companies but still meh. Not enough juice there for a price hike.
Where do we end up? Newell’s not a bargain bin snag nor a blinged-out splurge—just kinda coasting at “strongly Meh.” On one side, a ticked box on cheap assets, and on the flip, a flickering cash stream. Cue balance beam pose.
So, Newell Brands, take a bow in the “appropriately priced” section. This ride’s a mix of slight thrills, but mostly chill in the lukewarm kiddie pool of stock investments.
