Newell Brands Inc. (NASDAQ:NWL) stock climbed Friday after the consumer products company reported better-than-expected second-quarter results, raised its full-year 2026 guidance and issued third-quarter sales guidance that topped Wall Street estimates.
High short interest—standing at 21.65% of the float—likely catalyzed a short squeeze, amplifying the stock’s nearly 15% surge.
Earnings Beat Driven By Tariff Recoveries
Second-quarter net sales increased 3% year over year to $1.994 billion, exceeding analysts’ consensus estimate of $1.978 billion. Core sales rose 2.3%.
Adjusted earnings came in at 42 cents per share, more than double the consensus estimate of 20 cents. Normalized operating margin expanded to 16.2% from 10.7% a year earlier, while normalized EBITDA increased to $406 million from $280 million.
The company said results included approximately $126 million in pretax tariff recoveries related to IEEPA tariffs, contributing about 21 cents per share to adjusted earnings.
Learning Segment Leads Growth
The Learning & Development segment posted the strongest performance, with net sales rising to $851 million from $809 million a year earlier. Core sales increased 4.9%, supported by growth in both the Baby and Writing businesses, along with favorable foreign exchange.
Home & Commercial Solutions generated net sales of $903 million, up from $892 million a year ago. Favorable foreign exchange offset a 0.4% decline in core sales as strength in Kitchen and Home Fragrance was partially offset by weakness in the Commercial business.
The Outdoor & Recreation segment reported net sales of $240 million, compared with $234 million a year earlier. Core sales increased 3.7%, partly offset by unfavorable foreign exchange.
Cash Flow Improves, Debt Remains Elevated
Year-to-date operating cash outflow improved to $204 million from $271 million in the prior-year period, reflecting better working capital management and lower incentive compensation payments.
As of the end of the second quarter, Newell Brands had $5.0 billion in total debt and $209 million in cash and cash equivalents.
Company Raises 2026 Guidance
Newell raised its full-year adjusted earnings guidance to 73 cents to 77 cents per share from the previous range of 56 cents to 60 cents. The updated outlook is well above the analyst consensus estimate of 58 cents per share.
The company also increased its full-year revenue forecast to a range of $7.276 billion to $7.348 billion, compared with its prior outlook of $7.204 billion to $7.348 billion. The updated guidance brackets the Wall Street consensus estimate of $7.287 billion.
For the third quarter, Newell forecast adjusted earnings of 18 cents to 20 cents per share, compared with analysts’ estimate of 20 cents. It expects revenue of $1.842 billion to $1.860 billion, above the consensus estimate of $1.841 billion.
NWL Price Action: Newell Brands shares were up 14.98% at $5.91 at the time of publication on Friday, according to Benzinga Pro data.
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