NEWELL BRANDS INC. (NWL): what the price assumes

In the published model solve dated 2026-Q2, anchored at $6.18, NEWELL BRANDS INC. (NWL) is priced for +23.8% growth. boothcheck publishes no house fair value, target price, or buy/sell rating; individual model outputs and user-controlled scenarios are analytical inputs, not Boothcheck targets. Narrative composed 2026-06-27.

Generated: 2026-08-10 · Exported: 2026-08-12 · Source: https://boothcheck.com/report/NWL

Headline

FieldValue
TickerNWL
CompanyNEWELL BRANDS INC.
Current price$6.19/sh
CompositionCommercial 18% / Kitchen 25% / Home Fragrance 9% / Baby 14% / Writing 23% / Outdoor and Recreation 10%

What The Price Assumes (Inversion)

The assumption today's price embeds, recovered by inverting the valuation.

FieldValue
Inversion basiswhole-company
Operating margin (value-band context)2.7%
Operating margin today2.3%
Margin expansion (value-band)+0.4pp
Implied growth23.8%
Multiple paid49x operating income

The operating-margin figure is value-band context at year 12: derived from the framework's value band, a separate calculation — not part of the priced-in solve.

Solve inputs: computed at a 7% cost of capital with 4% terminal growth over a 5-year stage; each 1pp of cost of capital moves the implied operating-profit growth ~11.2pp (computed at the 7% minimum rate; the CAPM rate 6.6% sits below it).

Reconcile: at the x-ray's 9.3% required return this reads ~9.6 years; the models below use their own rates.

How unusual the bet is: elevated

ReferenceValue
vs own history+0.37σ
cohort percentile (of 77 peers)96
sustained it ~5 years at this level36%
implied end-window share0%

Valuation X-Ray

The price is supported by asset-based value, while growth-DCF lands below the price. A value/asset-supported name, not a pure growth bet.

How the valuation models price the stock relative to the market price. Price/FV above 1.0 means the market pays more than that lens defends (expensive); at or below 1.0 the lens can defend the price.

FamilyMedian price/FVModelsReads
Asset1.21x3expensive
Earnings—0—
Relative—0—
Growth4.45x1expensive

Families that justify the price: Asset Families that call it expensive: Growth

The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 4.8%); the inversion above states its own rate.

Per-Model Detail (n=4)

ModelFamilyFVPrice/FVApplicableMethodology
DCF Perpetual GrowthGrowth$0.00—noFCF base $0.1B, growth -2% (input: historical growth), terminal g 0.5%, WACC 4.8%, 5yr projection
DCF Exit MultipleGrowth$4.881.27xnoExit EV/EBITDA: 14.7x / 16.7x / 18.7x (bear / base = today's held flat / bull), 5yr
Relative ValuationRelative——noP/S fallback (negative EPS): Sector P/S 2.5x × TTM revenue — excluded from consensus
Simple DDMGrowth$1.394.45xyesDPS $0.28, g=-9.0% (sustainable: ROE (TTM) × retention; not the terminal-growth assumption), ke=9.3%
Two-Stage DDMGrowth$0.2326.89xyesStage 1: -57% for 5yr, Stage 2: 3.5% perpetual (excluded from median)
Simple Excess ReturnAsset$5.701.09xyesReference only (book value floor): BV/sh $5.70, ROE negative
Two-Stage Excess ReturnAsset$5.131.21xyesReference only (book value with convergence): BV/sh $5.70, ROE converges to ke
Discounted Future Market CapGrowth$3.891.59xnoRev $7.2B, growth -2% (input: historical growth; tapered), Terminal P/S: 0.3x / 0.4x / 0.4x (bear / base = today's held flat / bull, cap 8x)
Peter Lynch Fair ValueRelative$0.00—noNegative/zero EPS — earnings-based value floored at $0
Margin TrajectoryGrowth——no—
Earnings Power ValueEarnings$0.01618.50xnoNormalized EBIT (5y avg op income, one-time charges added back) $0.42B × (1−40%) / WACC 4.8% → EPV (no growth)
Residual IncomeAsset——no—
Graham NumberAsset——no—
EV/EBITDA RelativeRelative——noEBITDA $0.48B × sector EV/EBITDA 12.0x
FCF YieldEarnings$0.01618.50xyesFCF $118.0M / Kₑ 9.3% — zero-growth perpetuity (excluded from median)
SBC-Adj FCF YieldEarnings$0.01618.50xyesSBC-adj FCF $0.05B (FCF $0.12B − SBC $0.07B) capitalized at Kₑ (excluded from median)
Ben Graham FormulaEarnings——no—
ROIC-Justified P/BAsset$2.572.41xyesBV $5.70 × (ROIC 2.2% / WACC 4.8%)
P/Sales SectorRelative——noRevenue $7.25B × sector P/S 2.5x
PEG Fair ValueRelative——no—
Earnings YieldEarnings——no—
Funds From Operations MultipleRelative——no—
Clinical Phase NPVGrowth——no—
MertonAsset——no—
V5 Mechanical———no—

Economic-Unit Decomposition (Sum Of The Parts)

One or more material disclosed units has unresolved economics. Unknown/general is not evidence of homogeneity: segment SOTP is primary but incomplete, consolidated cash flow may remain only a secondary cross-check when every unit shares an enterprise basis, and one sector multiple or target margin is withheld.

UnitRoleValuation basisRevenueReported profitValue evidenceStatus
Home and Commercial Solutionsoperatingenterprise$3.8b—withheldunresolved no unit value
Learning and Developmentoperatingenterprise$2.7b—withheldunresolved no unit value
Outdoor and Recreationoperatingenterprise$741.0m—withheldunresolved no unit value

No total common-equity value is stated. One or more material units lack a supported unit value. The displayed values are an indicative subtotal; consolidated debt and cash cannot be applied to a fraction of the company.

Solvency

FieldValue
Net debt$4.8b
Net debt / NOPAT (after-tax)53.81x
Net debt / operating income (pre-tax)29.25x
Share count CAGR (dilution)0.9%
Burning cashno

Interest expense is not separately reported in the latest filings, so interest coverage cannot be computed.

Bullet Takeaways

Bull Case

Valuing a consumer-brands company at a depressed price requires separating two questions that look the same from the outside: is this a permanently impaired collection of fading brands, or a temporarily mismanaged one being fixed? Newell's portfolio argues for the second reading. These are not no-name products; they are category staples like Rubbermaid storage, Sharpie markers, Graco car seats, and Coleman outdoor gear, sold, as the 10-K describes, through "stores, drug/grocery stores, office superstores, office supply stores, contract stationers, distributors and e-commerce retailers, and direct to consumers online." Brands with that kind of shelf presence and consumer recognition do not lose their value overnight; they lose it through underinvestment, which is reversible.

The early turnaround evidence is encouraging on the metrics that matter for a consumer company. In Q1 2026, all three segments delivered core sales growth above plan, the long-struggling Learning and Development segment returned to core sales growth, and 6 of the top 10 brands gained market share. Gross margin rose to 33.1% from 32.1% a year earlier on pricing and productivity. Market-share gains and margin expansion are exactly the signals that distinguish a real operational fix from a value trap, because they show the brands resonating with consumers again rather than just cutting costs.

Management is investing behind the brands rather than starving them. The company plans to launch 25 first- and second-tier innovations in 2026, up from 18 the prior year, backed by higher advertising and promotion. It raised full-year net sales, core sales, and normalized earnings guidance after a quarter that beat across key metrics. The valuation methods support the case on the right lenses: the price sits near asset value and far below where the sales-based methods land, which means a buyer is paying close to book for a portfolio of recognized brands at the start of a turnaround.

Bear Case

The valuation methods disagree sharply on Newell, and untangling that disagreement is the bear's core task. The relative-multiple methods read the stock as extremely cheap, a small fraction of where sales-based comparisons land, while the growth-based methods read it as expensive, several times above where they land. Both can be true at once, and the reason they are is the company's profitability: Newell generates enormous revenue but almost no operating profit, with a trailing operating margin of just 0.7%. A company can look cheap on sales and expensive on earnings simultaneously when it is barely profitable, and the conservative read is that the earnings methods, which capitalize the actual profit, are the more honest lens.

The balance sheet is where that thin profitability becomes dangerous. Total debt is about $4.97 billion, and against the company's depressed operating income, net debt runs more than ninety times that profit. That ratio is extreme not because the debt is unusually large for a company this size, but because the earnings supporting it have collapsed. A leveraged company with razor-thin margins has very little room for error: if the turnaround stalls, a recession dents discretionary spending, or interest costs rise on refinancing, the debt service crowds out the advertising and innovation investment the turnaround depends on, and the company can be forced to deleverage from a position of weakness.

Tariffs add a live, uncontrollable headwind. The Q1 2026 P&L tariff impact was $0.10 per share, higher than the company's original estimate, with management warning of further volatility as trade policy evolves. For a company that manufactures and sources globally, every escalation pressures already-thin margins. The bear case is not that the brands are worthless, the asset-based methods support the price near book, but that the combination of minimal profitability, heavy debt, and tariff exposure means the turnaround has to succeed for the equity to be worth more than book value. At a 0.7% operating margin, the margin for error is essentially gone.

Valuation

Newell is a value-and-asset-supported name where the methods split dramatically, and the split is the whole story. The asset-based methods support the price, landing near book value, and the relative-multiple methods read the stock as very cheap on sales, a small fraction of where the comparison lands. But the growth-based methods read it as expensive. The reconciliation is the company's profitability: it earns substantial revenue at a trailing operating margin of only 0.7%, so it screens cheap against its sales and expensive against the sliver of profit those sales produce.

The price is therefore a bet on margin recovery rather than on growth. The inversion implies a long duration, on the order of thirteen years, for the company to grow into a normal margin from today's near-zero level. That is the turnaround thesis stated as arithmetic: the equity is worth meaningfully more than book only if Newell restores its operating margin toward where a healthy consumer-brands company runs. The early signs, gross margin rising to 33.1% and market-share gains across the top brands, are steps in that direction, but the gap between a 0.7% operating margin and a recovered one is wide. The right peer set is other consumer-products and packaging companies, where brand strength and margin durability set the multiple.

Solvency is the load-bearing element and bounds the downside in the wrong direction. Total debt of about $4.97 billion against depressed operating income produces a leverage ratio that looks extreme precisely because the earnings have fallen, not because the debt is oversized for the revenue base. With only about $201 million of liquid assets, the company has limited cushion, and the standard read is that the debt makes the equity a leveraged call on the turnaround: if margins recover, the deleveraging lifts the equity substantially; if they do not, the debt absorbs the value. The decisive variable is the operating margin: the asset and relative methods support the price today, but the equity's upside, and its risk, both run through whether Newell can rebuild profitability faster than the debt and tariffs erode it.

Catalysts

The Q1 2026 report, issued in early June, beat expectations and prompted a guidance raise. Newell reported a net loss of $33 million, or $0.05 per share, better than the $0.09 loss expected and modestly improved from a $37 million loss a year earlier, on net sales of $1.55 billion, down 1.1%. Gross margin rose to 33.1% from 32.1%, helped by pricing, productivity, and a $25 million benefit from refined customer-program estimates. Management said results came in ahead of expectations across all key metrics and raised full-year net sales, core sales, and normalized earnings guidance, though the full-year sales outlook still implies a roughly 1.5% decline.

The turnaround execution is the catalyst to track. Newell framed 2026 as the first year of its turnaround, plans to launch 25 first- and second-tier innovations, up from 18, and reported that all three segments delivered core sales growth above plan with 6 of the top 10 brands gaining share. The pace of market-share gains, the trajectory of gross margin, and the cadence of the innovation launches are the signals that will show whether the recovery is taking hold.

Tariffs and the balance sheet are the offsetting watch items. The Q1 tariff impact was $0.10 per share, above the original estimate, and management expects further volatility as trade policy evolves, a direct pressure on margins. Total debt of about $4.97 billion keeps deleveraging central to the story. Analyst price targets sit low, with a median near $4.50 against a recent price around $4.92 (June 27, 2026), reflecting the market's caution on a leveraged turnaround. The developments most likely to move the stock are the quarterly margin and share trends, any change in tariff policy, and progress on reducing debt.

Peer Cohorts (Per Segment, With Filing Citations)

Home and Commercial Solutions (reported)

Learning and Development (reported)

Outdoor and Recreation (reported)

Methodology Note

Fundamentals sourced from SEC EDGAR filings. Current price from Databento. The priced-in inversion and valuation x-ray are computed by the boothcheck engine; narrative composed by AI from the structured data.

Sources

Newell Q1 2026 results, June 2026

View the full interactive NWL report on boothcheck