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Spectrum Brands Holdings (SPB)
NYSE:SPB
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Spectrum Brands Holdings
(NYSE:SPB)
67Neutral
Positive Factors
Earnings Upgrade
The stock has been upgraded to BUY, with an increased price target.
Stock Buyback
The company will aggressively buy back stock at current levels, providing a floor to the stock.
Negative Factors
HPC Business Challenges
The HPC business will be most impacted by recently announced tariffs.
Spectrum Brands Holdings (SPB) vs. S&P 500 (SPY)
Market Cap
$1.93B
Dividend Yield2.46%
Average Volume (3M)503.47K
Price to Earnings (P/E)18.0
Beta (1Y)0.79
Revenue Growth2.56%
EPS Growth-91.05%
CountryUS
Employees3,100
SectorConsumer Cyclical
Sector Strength49
IndustryConsumer Products - Household & Personal
Share Statistics
EPS (TTM)4.07
Shares Outstanding26,313,921
10 Day Avg. Volume426,670
30 Day Avg. Volume503,467
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)0.65
Price to Cash Flow (P/CF)-6.70
P/FCF Ratio0.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$98.83Price Target Upside40.09% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering6
Spectrum Brands Holdings Business Overview & Revenue Model
Company DescriptionSpectrum Brands Holdings, Inc. engages in the manufacture and supply of residential locksets, residential builders hardware, plumbing, shaving and grooming products, personal care products, small household appliances, specialty pet supplies, lawn, garden and home pest control products, and personal insect repellents. It operates through the following segments: Hardware and Home Improvement (HHI); Home and Personal Care (HPC); Global Pet Care (GPC); Home and Garden (H&G). The HHI segment consists of hardware, security and plumbing business. The GPC segment focuses on the pet care business. The H&G segment involves the home and garden and insect control business. The HPC segment includes the small kitchen and personal care appliances business. The company was founded in 1906 and is headquartered in Middleton, WI.
How the Company Makes MoneySpectrum Brands Holdings generates revenue through the sale of its diverse range of consumer products across multiple segments. The company's key revenue streams include the Home and Personal Care segment, which sells small kitchen appliances, grooming products, and personal care items; the Global Pet Care segment, which offers a variety of pet products like food, grooming, and health supplies; the Home & Garden segment, which provides products for lawn and garden care, as well as insect and weed control; and the Hardware & Home Improvement segment, which includes locks, builders' hardware, and plumbing products. The company leverages strong brand recognition and extensive distribution networks to sell its products through various retail channels, including e-commerce platforms, large retailers, and specialty stores. Significant partnerships with retailers, along with strategic acquisitions and expansions into new markets, also contribute to its earnings.
Spectrum Brands Holdings Financial Statement Overview
Summary
Spectrum Brands Holdings demonstrates financial stability with strong profitability metrics and a healthy balance sheet. Consistent profitability is evident in its income statement, and low leverage reduces financial risks. However, challenges include a declining revenue trend and reduced free cash flow growth.Income Statement
Spectrum Brands Holdings shows a stable income statement with a gross profit margin of approximately 37.7% and a net profit margin of 4.0% for TTM (Trailing-Twelve-Months). While the gross profit margin has been consistent, the net profit margin shows improvement compared to the previous period. Revenue growth has been modest, indicating stability in sales. The EBIT and EBITDA margins are positive, reflecting operational efficiency. However, the overall revenue trend has been slightly declining over the years, suggesting potential challenges in market growth.75
Positive
Balance Sheet
The balance sheet of Spectrum Brands Holdings is robust with a debt-to-equity ratio of 0.04, indicating low leverage and a strong equity position. The return on equity stands at 5.9%, which shows a reasonable return for shareholders. The equity ratio is 56.1%, reflecting a solid capital structure. However, there has been a decline in total assets over the period, which could be a concern if it affects future growth opportunities.68
Positive
Cash Flow
The cash flow statement indicates positive free cash flow, with a free cash flow growth rate of -65.3% from the previous year, which is a concern. The operating cash flow to net income ratio is 0.69, suggesting that cash flow generation from operations is strong relative to net income. Despite these strengths, the reduction in free cash flow growth could impact future investment capabilities.72
Positive
| Breakdown | |||||
| TTM | Sep 2024 | Sep 2023 | Sep 2022 | Sep 2021 | Sep 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 2.97B | 2.96B | 2.92B | 3.13B | 3.00B | 3.96B | Gross Profit |
| 1.12B | 1.11B | 924.30M | 990.40M | 1.03B | 1.37B | EBIT |
| 190.30M | 170.60M | -205.60M | -5.30M | 97.10M | 243.40M | EBITDA |
| 282.00M | 323.90M | -72.00M | 166.90M | 253.40M | 244.10M | Net Income Common Stockholders |
| 119.30M | 124.80M | 1.80B | -77.00M | 15.30M | 97.80M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 179.90M | 368.90M | 1.86B | 243.70M | 187.90M | 531.60M | Total Assets |
| 3.61B | 3.84B | 5.26B | 5.78B | 5.34B | 5.11B | Total Debt |
| 79.00M | 638.40M | 1.65B | 3.21B | 2.55B | 2.57B | Net Debt |
| -100.90M | 269.50M | 897.20M | 2.97B | 2.36B | 2.03B | Total Liabilities |
| 1.59B | 1.70B | 2.74B | 4.51B | 3.86B | 3.69B | Stockholders Equity |
| 2.03B | 2.14B | 2.52B | 1.26B | 1.47B | 1.41B |
| Cash Flow | Free Cash Flow | ||||
| 41.20M | 118.60M | -468.70M | -117.80M | 244.80M | 229.30M | Operating Cash Flow |
| 82.70M | 162.60M | -409.70M | -53.80M | 288.40M | 290.30M | Investing Cash Flow |
| 881.70M | 1.02B | 3.18B | -359.80M | -423.50M | 108.30M | Financing Cash Flow |
| -1.24B | -1.58B | -2.26B | 487.60M | -209.90M | -497.10M |
Spectrum Brands Holdings Technical Analysis
Negative
70.55
Price Trends
80.42
Negative
85.17
Negative
86.42
Negative
Market Momentum
-2.15
Positive
30.81
Neutral
14.35
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SPB, the sentiment is Negative. The current price of 70.55 is below the 20-day moving average (MA) of 76.64, below the 50-day MA of 80.42, and below the 200-day MA of 86.42, indicating a bearish trend. The MACD of -2.15 indicates Positive momentum. The RSI at 30.81 is Neutral, neither overbought nor oversold. The STOCH value of 14.35 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SPB.
Spectrum Brands Holdings Risk Analysis
Spectrum Brands Holdings disclosed 57 risk factors in its most recent earnings report. Spectrum Brands Holdings reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Spectrum Brands Holdings Peers Comparison
Overall Rating
UnderperformOutperform
Sector (59)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | $27.60B | 47.33 | 14.25% | 1.05% | 4.08% | -22.34% | |
71 Outperform | $47.79B | 19.08 | 290.03% | 3.49% | -1.83% | 45.13% | |
67 Neutral | $1.93B | 18.01 | 4.91% | 2.46% | 2.56% | -91.05% | |
66 Neutral | $18.29B | 40.57 | 7616.67% | 3.29% | -1.98% | 474.83% | |
64 Neutral | $16.45B | 21.72 | 9.54% | 3.89% | -1.84% | -5.14% | |
60 Neutral | $2.20B | 38.45 | 37.60% | 4.07% | -0.31% | -37.69% | |
59 Neutral | $12.50B | 10.40 | 2.27% | 3.63% | 1.65% | -18.81% |
* Consumer Cyclical Sector Average
Performance Comparison
SPB
Spectrum Brands Holdings
70.55
-11.15
-13.65%
CHD
Church & Dwight
109.76
6.51
6.31%
CLX
Clorox
146.95
0.10
0.07%
ENR
Energizer Holdings
29.65
2.26
8.25%
HRL
Hormel Foods
29.49
-3.03
-9.32%
KMB
Kimberly Clark
140.14
19.62
16.28%
Spectrum Brands Holdings Earnings Call Summary
Earnings Call Date: Feb 6, 2025 | % Change Since: -14.34% | Next Earnings Date: May 8, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mixed outlook with notable strengths in e-commerce growth, Home and Garden success, and operational improvements, balanced against challenges such as declines in Global Pet Care sales, tariff and FX headwinds, and delays in the HPC transaction process.Highlights
Strong First Quarter Performance
Net sales increased 1.2%, excluding unfavorable FX, organic net sales up 1.9%. Adjusted EBITDA increased by $16.5 million if excluding prior year investment income.
Home and Garden Success
Net sales increased 27.9% driven by seasonal inventory build. Adjusted EBITDA increased to $9.3 million from a loss of $700,000 last year.
E-commerce Growth
E-commerce sales within HPC accounted for over 30% of quarterly global sales, outpacing brick-and-mortar growth. Strong online sales for products like the Emeril French Door air fryer.
Operational Excellence
Successful implementation of S4 HANA ERP in GPC North America and Home and Garden. Maintained a strong balance sheet with net leverage under 1.1 turns.
Shareholder Returns
Repurchased approximately 2.1 million shares for $183 million and returned over $1.2 billion to shareholders since the HHI transaction.
Lowlights
Global Pet Care Sales Decline
Reported net sales decreased by 6.1% due to prior quarter's pull forward and soft demand in aquatics.
Tariff and FX Headwinds
Incremental 10% tariffs on Chinese sourced products to impact cash flows and FX headwinds expected to negatively impact reported sales growth.
Challenges in Home Appliances
Competitive pressures in toaster ovens and air fryers led to low single-digit declines in home appliances sales.
Delay in HPC Transaction
Uncertainty from changing US tariffs has slowed the dual-track process for HPC transaction, taking longer due to geopolitical factors.
Company Guidance
During the first quarter of fiscal year 2025, Spectrum Brands Holdings, Inc. reported a net sales increase of 1.2%, with organic net sales rising by 1.9% excluding unfavorable foreign exchange impacts. The company achieved an adjusted EBITDA of $77.8 million, representing a 26.9% growth over the previous year's first quarter when excluding prior investment income. Gross margins improved by 140 basis points compared to the first quarter of fiscal 2024. The Home and Garden division experienced a significant boost with a 27.9% increase in net sales, primarily due to seasonal inventory builds. Global Pet Care saw a 6.4% decrease in organic sales, impacted by previous strategic order pull-forwards. E-commerce sales accounted for over 30% of total sales in the Home and Personal Care division, which achieved a 1.4% increase in net sales. The company maintained a strong balance sheet with net leverage under 1.1 turns and continued its robust capital return strategy, repurchasing approximately 2.1 million shares. Spectrum Brands reiterated its full-year expectations for low single-digit net sales growth and mid to high single-digit adjusted EBITDA growth.Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.