Newell Brands Inc (NYSE: NWL) is climbing early on in the trading session this morning, and for good reason. The company reported its earnings for the third quarter, beating expectations. The company also raised its outlook for the full year. Today, we’ll talk about:
- The financial results;
- what we’re seeing from NWL stock as a result; and
- what we’ll be watching for ahead.
NWL Climbs On Earnings
As mentioned above, Newell Brands is having an incredibly strong start to the trading session this morning after reporting earnings. The parent company to brands like Sharpie, Elmer’s and Graco did overwhelmingly well. Here’s what we saw from the report:
- Profits – During the thirrd quarter, profits from NWL were nothing to shake a stick at. The company said that during the quarter, it generated a profit of $234.4 million, working out to $0.48 per share. That’s a massive climb from the $7.1 billion net loss or $15.10 loss per share reported in the last quarter. Exclusing non-recurring items, earnings came to $0.81 per share. Analysts were expecting that earnings would be around $0.65 per share.
- Revenue – Revenue wasn’t quite as positive. During the quarter, analysts expected that the company would generate revenue of $2.35 billion. However, revenue actually came in at $2.28 billion.
- Guidance – Finally, Guidance also proved to be a big hit. The company said that for the full 2018 year, it is expecting for earnings to come in the range between $2.55 per share and $2.75 per share. Previously, the company guided for $2.45 per share ot $2.65 per share. In terms of revenue, guidance remained unchanged at between $8.7 billion and $9 billion.
This Could Lead To A Short Squeeze
While NWL is climbing in the market as a result of earnings, the gains may just be the beginning. As of late, the stock has been falling dramatically, losing 38% over the last 3 months. At the same time, short interest has been growing, and right now, sits at more than 11% of the float. With the positive news, we’re weeing what could be the perfect recipe for a short squeeze that could send the stock screaming for the top.
What We’re Seeing From The Stock
One of the first lessons that we learn when we start to dig into the market is that the news leads to moves. In the case of Newell Brands, the news proved to be overwhelmingly positive. After all, the company reported earnings well ahead of expectations, raised guidance, and is setting up for a short squeeze in the process. So, It’s not very surprising to see that investors are sending the stock upward in the market today. Of course, our partners at Trade Ideas were the first to alert us to the gains. Currently (10:02), NWL is trading at $16.02 per share after a gain of $2.50 per share or 15.13% thus far today.
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What We’ll Be Watching For Ahead
Moving forward, the CNA Finance team will continue to keep a close eye on NWL. In particular, we’re interested in following the story surrounding the company’s continued growth and seeing if it can reach the high bar it has set for itself in the fourth quarter. Nonetheless, we’ll continue to follow the story closely and bring the news to you as it breaks!
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