Case Study – Why the Story of Newell Matters So Much
Case Study – Why the Story of Newell Matters So Much
How one company ran its investors through the Osterizer
Some stock stories stick with you more than others. For me, Newell is among them...
Maybe best known for its 1999 merger with Rubbermaid, later dubbed “the merger from hell,” Newell went through so many incarnations and acquisitions over the years that it can be hard to keep them straight.
It was like a corporate shell game, and that’s never a good sign…
No wonder Newell landed on the radar of the short research firm I was with in 2017, prompting us to publish a report in September of that year headlined…
Is Newell About to Get Run Through the Osterizer?
The stock had already taken a tumble on an earnings disappointment – not its first – but as we wrote, “red flags are flying everywhere we look.”
The pushback we received at the time, from a few subscribers, was that “the valuation has already compressed.”
Indeed it had, reflected by its stock, which had tumbled about 20% in the months before we published.
From Bad to Worse
Our work suggested something worse was going on...
That’…