Newell Brands Q3 Earnings: Can It Outshine a Tough Macro Backdrop?

Newell Brands Inc. NWL is expected to register a year-over-year decline in the top line when it reports third-quarter 2025 results on Oct. 31, before the opening bell. The Zacks Consensus Estimate for quarterly revenues is pegged at $1.89 billion, indicating a decline of 2.8% from the figure reported in the year-ago quarter.

The consensus estimate for the bottom line is pegged at 18 cents per share, which indicates growth of 12.5% from that reported in the year-ago quarter. The consensus mark has been unchanged in the past 30 days.

In the last reported quarter, the Atlanta, GA-based company’s earnings met the Zacks Consensus Estimate. Its bottom line beat the consensus estimate by 25%, on average, in the trailing four quarters.

Newell Brands Inc. Price and EPS Surprise

 

Newell Brands Inc. price-eps-surprise | Newell Brands Inc. Quote

Factors Likely to Impact NWL’s Q3 Results

Newell Brands is set to release third-quarter 2025 results amid a turbulent macroeconomic environment that has weighed on consumer sentiment and discretionary spending. Persistent inflationary pressures, coupled with geopolitical volatility and rapidly evolving retail dynamics, continue to challenge the company’s ability to drive consistent top-line growth. NWL’s Outdoor & Recreation segment has particularly suffered from soft demand, and ongoing foreign currency headwinds and the effects of business exits may weigh on the second-quarter performance.

On its last earnings call, management expected net and core sales to decline 4-2%, with a normalized operating margin of 9.1-9.5% and normalized EPS of 16-19 cents. 

Our model predicts a third-quarter normalized operating margin of 9.5%, flat year over year. We expect the Outdoor & Recreation segment's sales to decrease 9.9% for the third quarter.

On the positive front, Newell Brands’ front-end commercial capabilities, mainly innovation and business development, coupled with a more streamlined organizational structure, appear encouraging. Stringent cost-cutting measures, including right-sizing overhead costs under its simplification agenda, further support profitability.

In addition to these productivity initiatives, pricing and a favorable mix serve as key growth drivers. This, coupled with pricing across the international markets, is expected to offset inflation and currency fluctuations. This is likely to have cushioned the company’s performance in the quarter under review.

Newell Brands’ efforts to restructure and reposition its business appear to be paying off in some areas. The company has successfully reduced exposure to Chinese imports, with only 15% of finished goods now sourced from China, down from 35% a few years ago. This proactive shift, along with sizable investments in U.S. manufacturing and automation, has created a tariff-resilient supply chain.

What the Zacks Model Unveils for Newell Stock

Our proven model conclusively predicts an earnings beat for Newell this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is exactly the case here. You can uncover the best stocks before they are reported with our Earnings ESP Filter.

Newell currently has an Earnings ESP of -6.80% and a Zacks Rank #3. 

Valuation Picture

From a valuation perspective, Newell offers an attractive opportunity, trading at a discount relative to historical and industry benchmarks. With a forward 12-month price-to-earnings ratio of 7.41X, which is below the five-year high of 16.88X and the Consumer Products - Staples industry’s average of 19.05X, the stock offers compelling value for investors seeking exposure to the sector.

The recent market movements show that NWL shares have declined 14.5% in the past three months compared with the industry's 5.1% decline.

Stocks With the Favorable Combination

Here are some companies, which, according to our model, have the right combination of elements to beat on earnings this reporting cycle.

Vital Farms VITL currently has an Earnings ESP of +8.84% and flaunts a Zacks Rank of 1. VITL is anticipated to register increases in its top and bottom lines when it reports third-quarter 2025 results. The Zacks Consensus Estimate for Vital Farms’ quarterly revenues is pegged at $191 million, indicating growth of 31.7% from the figure reported in the prior-year quarter. You can see the complete list of today’s Zacks #1 Rank stocks here.

The consensus estimate for Vital Farms’ bottom line has been unchanged in the past 30 days at 29 cents per share. This implies a surge of 81.3% from the year-ago quarter’s reported figure. VITL delivered an earnings beat of 35.8%, on average, in the trailing four quarters.

The Estee Lauder Companies EL has an Earnings ESP of +15.65% and a Zacks Rank of 3 at present. EL is likely to register top and bottom-line growth when it releases first-quarter fiscal 2026 results. The Zacks Consensus Estimate for its quarterly revenues is pegged at $3.4 billion, which implies growth of 0.6% from the figure in the prior-year quarter.

The consensus estimate for Estee Lauder’s bottom line has moved up by a penny to 16 cents per share in the past seven days. The estimate indicates 14.3% growth from the year-ago quarter’s actual. EL delivered an earnings surprise of 71.5%, on average, in the trailing four quarters.

Monster Beverage MNST currently has an Earnings ESP of +0.82% and a Zacks Rank of 3. The company is likely to register increases in the top and bottom lines when it reports third-quarter 2025 numbers. The Zacks Consensus Estimate for quarterly earnings per share is pegged at 48 cents, suggesting a 20% rise from the year-ago period’s reported number. The consensus mark has been unchanged in the past 30 days.

The consensus estimate for Monster Beverage’s quarterly revenues is pegged at $2.1 billion, which indicates growth of 11.9% from the prior-year quarter’s actual. MNST has a trailing four-quarter earnings surprise of 0.2%, on average.

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This article originally published on Zacks Investment Research (zacks.com).

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