Newell Rubbermaid (NYSE: NWL) - Same Company Founded in 1902 Manufacturing Curtain Rods
Newell Rubbermaid (NYSE: NWL) is now the company that is found in almost every home and office around America. This manufacturer of home organization products, such as plastic outdoor storage sheds, kitchen, hardware, seasonal, cleaning products (brooms, dustpans, and refuse containers), and commercial items. In 1994, Rubbermaid was voted America's most admired company. Newell, a major competitor, bought Rubbermaid for $5.8 billion in 1999. They have come a long way since the 1902 curtain manufacturer to say the least.
Technically speaking the stock looks to have set up nicely here. Fundamentally speaking I would have liked to see Newell Rubbermaid a bit stronger. It is not weak in all fundamental categories however, and one of the most important categories is group rank, or how a company compares to their competitors. Is it a group leader or not? In this case yes, NWL scores 74.5% on the group rank scale.
For Group Rank, you will want the stock to be 70% or higher for a good score. A 70% or higher score means this company did fundamentally better than 70% of the companies in the sector. I don't trade stocks that score 30% or lower. I stick only with group leaders, as they tend to perform more reliably when it comes to my technical analysis.
Taking a look at the NWL chart, you will notice the nice decline the stock has experienced over the last 3-4 months. It now tests its 200-Day SMA. Thus far, the stock has held 200-Day SMA support level and I am increasingly encouraged by the new institutional money showing up and moving steadily into the NonCyclical/Personal & Household Products (.CPH) Sector.
Again, I point out a low risk opportunity. My stop is set 24.00, a mere 55 cents below the current price and just under the current support level. A breach of this trend will change the fundamentals of the chart from a technical standpoint and thus lose my interest. The MACD and Full STO also suggest the stock has been oversold recently and could be poised to bounce. The intraday tail this past Friday could also suggest the beginning of this bounce.
I am curious to see how other chartists and fundamentalists analyze the current setup of the stock here. Chartists, do you agree with my analysis? Fundamentalists, do you see anything else compelling about NWL? Are you seeing what I am seeing and is this stock worth your time? Let me hear your 22cents..
UPDATE: Well again, congrats to all my reads that made money on this trade. Here is an updated chart from when I last pointed out this opportunity only 5 days ago!
Yesterday Newell Rubbermaid hit $47.21 on the intraday. This is a nice 10% plus move. I now move my stop up just below the 50Day SMA to lock in these profits and let the rest run. The stock looks like a very promising long term hold here. We could see a slight pull back in the short term. Thanks for playing along and don't spend all your profits in one place.