<\/p>\n
Newell Brands (NWL), the company behind Sharpie markers, Graco car seats, Coleman coolers, and Rubbermaid containers, watched its stock lose about 74% of its value over the last five years.<\/p>\n
Then on Friday, July 31, the maker of those household staples did something it had not done in over four years. It grew.<\/p>\n
Newell reported its first year-over-year increase in both net sales and core sales since 2021, and investors responded quickly.\u00a0<\/p>\n
The stock jumped about 15% to trade near $5.90.<\/p>\n
For a name that many analysts had written off as a value trap, the second-quarter report changed the conversation.<\/p>\n
What drove the Newell Brands earnings beat and stock surge<\/p>\n
According to Benzinga, Newell posted second-quarter net sales of $1.994 billion, up 3% from a year earlier and ahead of the roughly $1.978 billion analysts expected.\u00a0<\/p>\n
Core sales also rose 2.3%.<\/p>\n
Adjusted earnings landed at 42 cents per share, more than double the consensus estimate of about 19 cents.<\/p>\n
A large part of that growth came from tariff relief.\u00a0<\/p>\n
Newell recorded about $126 millionin pretax recoveries tied to IEEPA tariffs it had paid, which added roughly 21 cents per share, Yahoo Finance reported.\u00a0<\/p>\n
Remove that one-time benefit and underlying earnings came in near 21 cents, still above management’s earlier guidance range of 16 to 19 cents.<\/p>\n
Newell Brands owns household names including Sharpie, Rubbermaid, Graco, and Coleman, and its second-quarter turnaround surprised a skeptical Wall Street.<\/p>\n
SOPA Images / Getty Images<\/p>\n
Why the Newell turnaround isn’t just luck<\/p>\n
A single tariff refund does not fix a struggling company. What gave the quarter weight was where the growth came from.<\/p>\n
CEO Chris Peterson said five of Newell’s six business units posted core sales growth, and the U.S., its largest market, grew about 5%.\u00a0<\/p>\n
He called it the first domestic growth since the pandemic era.<\/p>\n
The Learning & Development segment led the way, with core sales up 4.9% and net sales rising to $851 million from $809 million a year earlier.<\/p>\n
That growth traced back to product launches.\u00a0<\/p>\n
More Consumer Brand Coverage:<\/p>\n
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Newell said it gained U.S. market share in four of its best-known brands: Graco, Sharpie, Expo, and Coleman. New product launches and wider retail distribution helped drive that gain.<\/p>\n
Gross margin also rose to 40.7% from 35.4% a year earlier, meaning the recovery showed up in the company’s profitability, not just in sales.<\/p>\n
How Newell’s updated 2026 guidance stacks up against Wall Street<\/p>\n
Newell’s management did more than report a good quarter. It raised expectations for the rest of the year.<\/p>\n
The company raised its full-year adjusted earnings outlook to a range of 73 to 77 cents per share, up sharply from its prior 56 to 60 cents, Benzinga reported.\u00a0<\/p>\n
That new range sits well above the 58-cent consensus.<\/p>\n
Here is how the revised outlook compares.<\/p>\n
Newell Brands 2026 outlook, old versus newAdjusted EPS: Raised to $0.73 to $0.77 from $0.56 to $0.60 (consensus near $0.58)Net sales growth: Raised to 1% to 2% from flat to 2%Full-year revenue: Raised to $7.276 billion to $7.348 billion<\/p>\n
For the third quarter, Newell guided to earnings of 18 to 20 cents per share on revenue of $1.842 billion to $1.860 billion.\u00a0<\/p>\n
Both figures came in around or above what analysts had expected.<\/p>\n
Why NWL stock jumped so hard on the report<\/p>\n
Part of the July 31 move stemmed from how negative Wall Street had turned on the stock.<\/p>\n
Short sellers had piled into Newell, with short interest standing at 21.65% of the float, according to Benzinga. That means roughly one in five available shares was being bet against.<\/p>\n
Related: Verizon hits a snag in attracting customers to a key service<\/p>\n
When the earnings beat came in, many of those short sellers had to buy shares back fast to cover their bets. That buying pressure added extra fuel to the rally.<\/p>\n
Valuation also played a role. Newell shares had been trading at a price-to-sales ratio of about 0.2, far below what most consumer goods companies command.\u00a0<\/p>\n
Years of decline had priced the stock like a company that was never coming back.<\/p>\n
Newell also gave itself more room to operate. It entered a new $800 million asset-based revolving credit facility that pushes general debt maturities out to 2031, Yahoo Finance noted.\u00a0<\/p>\n
That refinancing matters because Newell still carries $5.0 billion in total debt against $209 million in cash.<\/p>\n
What could still go wrong for Newell Brands investors<\/p>\n
The quarter was strong, but the risks that made NWL cheap have not disappeared.<\/p>\n
Inflation is the clearest one. Newell now expects about $200 millionin inflationary costs this year, double its earlier $100 million estimate.<\/p>\n
Tariffs remain a headwind as well. The company projects a $127 million net tariff cost for 2026, separate from the refunds that boosted this quarter.<\/p>\n
Demand is still slow. Consumer and retail volumes remain weak globally, and major retailers are keeping inventory tight, which limits how fast Newell can grow.<\/p>\n
The earnings beat raises one big question. A large share of it came from a one-time tariff recovery, not from the underlying business.\u00a0<\/p>\n
So the real test is simple: Can Newell keep expanding margins in future quarters without that refund propping up the numbers?<\/p>\n
How Newell stock compares to the market this year<\/p>\n
For all the damage of recent years, 2026 has treated Newell shareholders better than the broad market.<\/p>\n
The stock is up about 59% year to date, a sharp reversal from its long decline. In comparison, the S&P 500 has posted a more modest single-digit gain over the same stretch.<\/p>\n
That gap shows how much of Newell’s move is a recovery from deeply depressed levels rather than proof the business has fully healed.<\/p>\n
What Newell Brands investors should watch next<\/p>\n
One quarter, even a strong one, does not settle the debate over whether Newell is a bargain or a lingering value trap.<\/p>\n
For current holders, the signals worth tracking are simple:\u00a0<\/p>\n
Whether U.S. sales growth holdsWhether margins expand without tariff refundsWhether management chips away at that $5 billion debt load<\/p>\n
For anyone considering a new position, the raised guidance offers a clearer target than the company has given in years, but the stock’s low price still reflects real risk.<\/p>\n
Newell has finally shown it can grow again. The next few quarters will show whether it can keep doing so on its own strength.<\/p>\n
Related: Ford set to challenge Tesla after big new deal with tech giant<\/p>\n
#Consumer #goods #giant #quietly #wows #investors #terrible #streak<\/p>\n","protected":false},"excerpt":{"rendered":"
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