What to Expect When Spectrum Brands Posts Q4 Earnings

Analysts project that Spectrum Brands (SPB) will post an increase in fourth-quarter earnings and revenue year-over-year before Thursday's opening bell.

Wall Street is looking for the Middleton, WI-based consumer products company to report adjusted earnings of $1.29 per share on revenue of $1.33 billion, according to FactSet. Last year, Spectrum earned $1.13 per diluted share on revenue of $1.31 billion.

Spectrum, whose brands include George Foreman, Remington and Black+Decker, hosted an upbeat investor day last month with a focus on growth initiatives, according to Oppenheimer.

"SPB believes it can achieve above market growth through a combination of organic opportunities and savvy M&A," the firm wrote in a recent note.

The company also announced it could exceed its fiscal 2016 free cash flow guidance of $505 million to $515 million due to strength in its hardware and home improvement unit (HHI), and home and garden segment, as well as working capital improvements, Oppenheimer said.

Additionally, each segment has its own growth drivers, for example Spectrum's HHI division can expand into electronic locks and increase commercial sales into Home Depot (HD), Amazon.com (AMZN) and Lowe's (LOW), the firm added.

Merger and acquisition areas include HHI, autocare domestically, and home and garden internationally, according to the firm.

"Overall, we remain bullish on SPB and are encouraged by SPB's ongoing transition to a faster growing company. The company continues to deliver generous FCF and deploy it opportunistically to generate incremental returns," Oppenheimer noted.

Yesterday, the company declared a dividend of 38 cents per share, payable on December 15 to stockholders of record as of the close of business on November 30.

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