Investors bid up shares of
25% Thursday after the company posted earnings that easily surmounted Wall Street targets, even as sales declined.
The Atlanta consumer-goods company said that, excluding restructuring costs and impairment charges, first-quarter earnings came in at $111.3 million, or 20 cents a shares. Analysts had forecast 8 cents a share, according to Thomson Reuters.
With those charges, Newell earned $33.7 million, or 12 cents a share, in the quarter, down from last year's $57.8 million, or 21 cents a share, which also included restructuring charges.
Sales, meanwhile, fell 16% to $1.2 billion from $1.43 billion, in line with analysts' estimates.
Cost-cutting measures were largely responsible for the better-than-foreseen results, the company indicated, including last month's slashing of its dividend to 5 cents a share from 10.5 cents, which
reduced the stock's dividend yield to 2.76%.
In its pre-market press release announcing first-quarter results, Newell also gave earnings and sales guidance for the rest of the year, targeting second-quarter EPS of 30 to 37 cents and full-year EPS of $1.00 to $1.25. For those periods, analysts are expecting 34 cents and $1.00, respectively.
Newell said it anticipates a 20% decline in its top line for the second quarter when compared with the same period in 2008. The company blamed that fall-off on "aggressive management of inventory by retailers and weak consumer spending."
Newell shares traded recently at $10.66, up $1.99, or 23%, on heavy volume.
Copyright 2009 TheStreet.com Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed. AP contributed to this report.