Newell Brands (NWL) reported first-quarter results that missed analysts’ estimates, with the company losing $0.06 a share versus income of $0.35 a share last year. Analysts only expected a $0.03 per share loss. Sales declined 24.4%, or 18% excluding currency and the sale of the Connected Home and Security Business (CH&S). Last year’s first quarter reflected peak-COVID-related demand and normalization of retailer inventories. So, lower consumer demand drove the disappointing first-quarter results.

The company guided 2023 to the low end of expected EPS range of $0.95 to $1.08, with a 6% to 8% decline in core sales. Despite this, the stock is moving higher today. This probably reflects the fact that NWL is still predicting a return to profitability next quarter, and the company’s cash flow in the current quarter was helped by a $250 million reduction in inventory from the prior year. Further cost cuts from the company’s Project Phoenix and price hikes on certain products should also lift results for the remainder of the year.

It may take another quarter for investors to gain confidence that the worst is over for Newell, but I feel the company is on the right track. NWL is a buy below $13.50. My $17.50 target is 14X a reasonable 2024 EPS of $1.25.