This stock has one of the best-known brand names in the world and generates 90% of its sales outside of its U.S. base.
The company’s shares tumbled during the recent market downturn. But the strength of its worldwide market points to a vigorous rebound, with the stock trading at just 10 times forecast earnings for 2018.
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TUPPERWARE BRANDS CORP. (New York symbol TUP; www.tupperwarebrands.com) makes household goods such as plastic containers for food, beverages, cosmetics and fragrances. It sells these products through 3.2 million independent dealers. That network keeps its distribution costs down.
The company gets 90% of its revenue from outside of the U.S., so income from sales rises and falls with the relative strength of the U.S. dollar. On the other hand, Tupperware benefits from new regulations introduced last year in China that permit it to sell its products through dealers. Before the change, it was restricted to selling its products through 5,600 retail outlets.
Tupperware has agreed to sell its money-losing Beauticontrol business to Youngevity International Inc. (Nasdaq symbol YGYI). That operation sells cosmetics and personal-care products.
The company has yet to reveal the selling price. However, it will continue to earn royalties on future sales of Beauticontrol products.
Tupperware also continues to make progress with its plan to improve efficiency. That should help it offset rising costs for plastic resin.
Tupperware’s sales moved up 3.4%, from $2.6 billion in 2012 to $2.7 billion in 2013. The higher U.S. dollar cut revenue to $2.6 billion in 2014. By 2016, revenue declined to $2.2 billion. Without exchange rates, sales rose 2% in 2016.
Earnings jumped 42.1% in 2013, from $193.0 million in 2012 to $274.2 million. Due to fewer shares outstanding, per-share earnings gained 51.2%, from $3.42 to $5.17. The company’s earnings then fell to $4.20 a share (or $214.4 million) in 2014, and to $3.99 a share (or $201.6 million) in 2015. However, earnings rebounded to $4.39 a share (or $222.5 million) in 2016.
Value Stocks: Quarterly dividend yields a high 5.2%
In the final quarter of 2017, Tupperware’s sales fell 2%, to $588.6 million from $600.9 million a year earlier. Excluding exchange rates, overall sales fell 4%. Sales in emerging markets were up 2% (67% of total sales), or 1% excluding exchange rates. Stronger sales in Brazil, China and Mexico offset weaker revenue in India and Indonesia.
The company had a net loss in earnings of $326.5 million in the quarter, compared to a gain of $79.0 million a year earlier. The loss was inflated by one-time tax charges related to the new U.S. tax reforms as well as costs from the company’s re-engineering program. Excluding those items and exchange rates, earnings per share rose 6.0%, to $1.59 from $1.50 a year earlier.
Tupperware ended the quarter with cash of $144.1 million, or $2.82 a share. Its long-term debt of $605.1 million is a reasonable 22% of its market cap.
Excluding unusual items, the company expects its earnings to rise from $4.84 a share in 2017 to $5.16 for 2018. The stock trades at 10.1 times that 2018 estimate.
The company last raised its quarterly dividend by 9.7% with the April 2014 payment. The $2.72 dividend yields a high 5.2%.
Recommendation in Wall Street Stock Forecaster: Tupperware is a buy.
Is this a mistake in the year? Or is it copy from a previous version? I would love to know.
The company last raised its quarterly dividend by 9.7% with the April 2014 payment. The $2.72 dividend yields a high 5.2%
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Is this a mistake in the year? Or is it copy from a previous version? I would love to know.
The company last raised its quarterly dividend by 9.7% with the April 2014 payment. The $2.72 dividend yields a high 5.2%