Newell Brands (NWL): Losses Deepen 37.4% Annually, Challenging Profit Recovery Narratives

Newell Brands (NWL) reported deeper losses again this year, with net losses compounding at an average rate of 37.4% annually over the past five years and showing no improvement in profit margins. Despite the company’s poor track record, management is forecasting a turnaround with earnings expected to grow 29.16% per year and the business predicted to become profitable within three years. These projections would outpace typical market profit growth rates. Revenue, however, is only forecast to increase by 2.5% per year, much slower than the 10.3% market average. This slower revenue growth keeps investor enthusiasm in check even as the stock trades at $3.40, which is well below its DCF fair value of $19.06.

See our full analysis for Newell Brands.

Next, we weigh how these latest figures stack up against the most popular narratives and expectations for Newell Brands. Let’s see what the numbers confirm and where they challenge the prevailing story.

See what the community is saying about Newell Brands

Profit Margin Targets Defy Past Trend

• Analysts expect profit margins to swing from -3.3% today to a positive 6.3% within three years, even though Newell Brands has shown no margin improvement in the past five years and remains unprofitable up to now.
• According to analysts' consensus view, structural shifts such as portfolio optimization and aggressive cost-cutting are forecast to help margins recover, even as core sales remain weak and macroeconomic headwinds persist.
  • Consensus narrative points to ongoing margin expansion as cost-saving initiatives and ERP harmonization take effect, but warns that prolonged pressure on core sales and exposure to tariffs could still limit improvements.
  • Margin targets are ambitious given the company’s unbroken streak of losses, so consensus emphasizes this is only achievable if demand for innovative, premium products materializes as expected.

What stands out is how this projected improvement in margins contrasts with the company’s historical lack of progress, making it a key debate point among analysts. Read the full Newell Brands Consensus Narrative. 📊 Read the full Newell Brands Consensus Narrative.

Net Leverage Limits Flexibility

• Newell’s elevated net leverage ratio of 5.5x and a heavy debt load signal that high interest expenses could restrict investment in innovation, marketing, or pivots needed to reach profit forecasts.
• The analysts' consensus narrative highlights financial risks arising from high leverage, noting that persistent debt and interest costs may reduce the company’s ability to respond to adverse shifts in consumer spending or global trade.
  • This leverage concern is linked directly to fears that limited financial flexibility could slow strategic investment, despite management’s efforts to cut costs and boost efficiency.
  • Consensus also notes that rising rates or weaker-than-anticipated cash flow could quickly amplify financial strain, raising stakes for the execution of the turnaround plan.

DCF Fair Value Sparks Valuation Debate

• Despite its current share price of $3.40, Newell Brands’ DCF fair value stands at $19.06 and the price-to-sales ratio of 0.2x is substantially below the industry average of 0.6x, highlighting a major valuation disconnect.
• Analysts’ consensus view argues that constructive valuation signals such as a deep fair value discount and low price-to-sales ratio are offset by the slow 2.5% projected revenue growth and concerns about dividend sustainability.
  • The consensus perspective weighs the prospect of future profitability (expected within three years) against questions about the company’s ability to reclaim lost ground amid ongoing industry and company-specific risks.
  • Bulls may see upside based on valuation gaps, but consensus stresses that only a proven operational turnaround can close the gap versus fair value.

Next Steps

To see how these results tie into long-term growth, risks, and valuation, check out the full range of community narratives for Newell Brands on Simply Wall St. Add the company to your watchlist or portfolio so you'll be alerted when the story evolves.

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A great starting point for your Newell Brands research is our analysis highlighting 3 key rewards and 1 important warning sign that could impact your investment decision.

See What Else Is Out There

Newell Brands faces ongoing losses, high leverage that restricts financial flexibility, and weak revenue growth. These factors raise doubts about its ability to deliver a true turnaround.

If you want to focus on companies with healthier balance sheets and less debt risk, check out solid balance sheet and fundamentals stocks screener (1983 results) built to withstand challenges that weigh on Newell Brands today.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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