Newell Brands' (NWL) Baby Jogger Launches Stroller Line

·4 min read

Newell Brands Inc’s NWL kids’ unit Baby Jogger has come up with a new baby stroller by the name City Select 2. The new collection features bold, new designs, reimagined gear, earth-toned colors, improved finishes, and better fabrics, in sync with the current trends of the fashion and automotive industries.

The brands’ latest City Select 2 stroller is available in three color options — Lunar Black, Peacoat Blue and Pure Mulberry. The product will soon be launched in more colors at its website, www.babyjogger.com. The strollers are foldable, and are 20% smaller and lighter than the previous version. Parents can also opt for product upgrades, including leatherette accents on the handle, belly bar and sustainably sourced TENCEL performance fabrics on the canopy and seat pad to enhance breathability and thermal regulation.

Prior to this, the Baby Jogger brand also introduced variants of some of its other stroller products, including City Mini 2, City Mini GT2 and City Tour 2. City Mini 2 is a sleek, nimble, and lightweight everyday stroller, while City Mini GT2 comes with forever-air rubber tires and all-wheel suspension, which offers uncompromising agility. Lastly, City Tour 2 is an ultra-compact, one-step fold and lightweight stroller with a carry bag.

Here’s What Else You Need to Know

Newell Brands has been benefitting from the rollout of vaccines and the lifting of restrictions as the company witnessed healthy in-store consumption trends in the United States. Sales growth in brick-and-mortar stores outpaced digital sales in second-quarter 2021 as it lapped a period of store closures and lockdowns in the year-ago quarter.

Consumption trends for writing, which witnessed significant declines last year, have improved. In second-quarter 2021, it witnessed recovery in the Writing Business, with core sales growth in the unit. Sales in the unit also retained momentum on a sequential basis. Strength across all regions, school reopenings, and the demand for key categories such as pens, presentation markers, permanent markers and highlighters remained upsides.

This marked the second consecutive quarter of strong POS growth in the Writing business. Going ahead, management remains optimistic about the back-to-school season and is on track for long-term growth on the back of robust merchandising plans.

On the online front, the company remains on track to leverage its robust omnichannel capabilities, which have continued to stay strong. The e-commerce business witnessed mid-single-digit sales growth, accounting for roughly 20% of total sales in the second quarter. Going forward, the company expects digital penetration to increase despite the potential quarterly fluctuations due to the lapping of the extravagant digital sales witnessed in 2020 due to store closures.

Driven by all these factors, management raised the 2021 sales view and issued upbeat third-quarter guidance. The company now anticipates 2021 sales of $10.1-$10.35 billion compared with the earlier mentioned $9.9-$10.1 billion. Core sales growth is likely to be 7-10%, up from the prior mentioned 5-7%. Normalized earnings per share are forecast to be $1.63-$1.73 for the year. For third-quarter 2021, net sales are envisioned to be $2.7-$2.78 billion, with core sales ranging from flat to up 3% year over year. Normalized earnings are likely to be 46-50 cents a share.

Consequently, shares of this Zacks Rank #3 (Hold) stock have gained 21.2% year to date compared with the industry’s growth of 0.8%.

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However, Newell Brands continues to grapple with elevated advertising and promotional expenses related to product launches and omnichannel investments. Headwinds related to transportation and labor costs along with unfavorable currency movement remain concerning.

Management anticipates inflationary pressure to be at its peak in the third quarter, which is expected to hurt margins. The third-quarter normalized operating margin is forecast to be 10.3-10.8%, suggesting a decline from the prior-year quarter’s reported figure of 14.9%.

Better-Ranked Stocks to Consider

Pilgrim Pride Corporation PPC, a Zacks Rank #2 (Buy) stock, has an expected long-term earnings growth rate of 31%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Albertsons Companies ACI presently has a long-term earnings growth rate of 12% and a Zacks Rank #2.

Helen of Troy HELE currently has an expected long-term earnings growth rate of 8% and a Zacks Rank #2.


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