Sharpie Maker Newell Brands’ Weak Outlook Sends Its Stock Plummeting

Newell Brands (NWL) shares plunged over 17% in intraday trading Friday as the consumer products maker gave weaker-than-expected guidance as it struggles to realign its operations.

The maker of Rubbermaid kitchenware and Sharpie pens said it expects full-year earnings per share (EPS) of between 52 cents and 62 cents, below estimates, with net revenue falling 5% to 8% to a range of $7.48 billion to $7.73 billion.

The company noted that by the end of last year it substantially implemented its Project Phoenix restructuring and savings initiative launched in January 2023. The effort was designed to “simplify the organizational structure, streamline the company’s real estate, centralize its supply chain functions, which include manufacturing, distribution, transportation and customer service, transition to a unified One Newell go-to-market model in key international geographies, and otherwise reduce overhead costs.”

Last month, Newell had announced an organizational realignment, which it said is expected to “strengthen the company’s front-end commercial capabilities, such as consumer understanding and brand communication.”

CFO Mark Erceg said that despite “a challenging, macro-economic environment,” the steps the company is taking will strengthen its performance in the future.

In the fourth quarter, Newell reported EPS of $0.22, with revenue declining 9.1% from a year ago to $2.08 billion. Both exceeded estimates. Sales at its Home & Commercial Solutions segment fell 8.2%, while Learning & Development sales dropped 7.7%, and Outdoor & Recreation sales declined 21.8%.

Newell Brands shares were down 17.7% at $6.95 per share as of about 3:15 p.m. ET Friday. They have lost more than half their value over the past year.