Newell Brands Earnings Show More Growth. The Turnaround Is Gaining Steam. — Barrons.com

What happened

Newell Brands reported third-quarter earnings of 20 cents a share, matching estimates, and revenue growth of 3.7% to $1.87 billion, slightly above expectations. Core sales grew for a second straight quarter, with increases in every region and at seven of its top 10 brands.

Confirmed

Global impact / market context

The results signal that Newell's turnaround is gaining traction: core sales growth across all regions and higher gross and operating margins despite inflation pressure suggest stronger demand and better cost control, which can support profit and cash available for reinvestment.

Analyst inference

The shares edged higher on a down market day after in-line results, suggesting investors welcomed the second consecutive quarter of core sales growth and margin improvement. Management highlighted the best back-to-school season in over three years for writing brands.

Analyst inference

What to watch

1. Whether core sales growth continues in every region and at seven of the top 10 brands, since the article says this was the second straight quarter of such growth. Confirmed
2. Track margin trends, because management says gross and operating margins rose year over year despite increased inflation pressure, which means cost increases were offset. Proposed
3. Watch whether writing brands such as Sharpie, Expo, Prisma Color and Elmer's sustain strong growth, as management says demand is returning to writing instruments after years of predicted decline. Analyst inference

Evidence

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