Why Tupperware Shares Surged


Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of food-storage container specialist Tupperware Brands (NYS: TUP) climbed 10% today after its quarterly results and outlook topped Wall Street expectations.

So what: Tupperware shares have slid over the past six months on concerns over weak global demand, but today's wide third-quarter beat -- adjusted EPS of $0.95 on revenue of $594.4 million versus the consensus of $0.91 and $586.3 million -- coupled with upbeat guidance for the current quarter suggests that things are starting to turn. While sales in the company's established markets declined 3% in local currency, sequential improvement from the second quarter combined with continued strength in emerging markets is giving investors plenty of optimism over its growth going forward.

Now what: Management now sees full-year adjusted EPS of $4.94 to $4.99, nicely ahead of the average analyst estimate of $4.88. "We continued to implement our strategies for improvement in our challenged markets and have seen positive trend changes in the underlying performance indicators in most of these businesses," Chairman and CEO Rick Goings said in a statement. With the stock still sporting a dividend yield of 2.5% and trading at a cheapish forward P/E of 10, Fools shouldn't let today's rally stop them from buying into that bull talk.

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The article Why Tupperware Shares Surged originally appeared on Fool.com.

Fool contributor Brian Pacampara has no positions in the stocks mentioned above. The Motley Fool owns shares of Tupperware Brands. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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