SPY386.54-3.04 -0.78%
DIA314.19-1.40 -0.44%
IXIC13,358.79-230.04 -1.69%

Research Alert: CFRA Maintains Hold Opinion On Shares Of Spectrum Brands Holdings, Inc.

· 02/05/2021 09:37

02:35 PM EST, 02/05/2021 (MT Newswires) -- CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:

We lift our 12-month target price to $90 from $72, calculated by an EV/EBITDA multiple of 9x against our FY 21 (Sep.) adj-EBITDA estimate of $645M (up from $609M). We lift our FY 21 EPS estimate to $6.61 from $5.10 and FY 22's to $5.81 from $5.64. SPB posts F1Q (Dec-Q) adj-EPS of $2.13 vs. $0.20, well above the $0.77 consensus. Organic sales grew 27.8% and adj-EBITDA dollars doubled Y/Y. Adj-EBITDA margin grew 610 bps to 17.8% (strongest in recent history). The beat was driven by strong sales growth and operating leverage across all segments. However, SPB was up against easier comps and did experience some temporary benefits this quarter, including a catch up on sales orders after experiencing supply chain constraints in FY 20 (drove about a third of sales growth). Going forward, we expect top- and bottom-line growth to moderate, with adj-EBITDA declining Y/Y in F2H 2021. Commodity inflation, rising ocean freight rates, and tariffs are a concern as SPB sources and manufactures many products from China.