Did you catch one theme of the frugal consumer era? For middle America, dinner out is out; dinner in is in.
Look for Newell Rubbermaid to continue to profit from this trend, as Americans shun dining out for a very long time, which means leftovers will increase. That's bullish for the company's Rubbermaid food storage containers; kitchen utensils will also see impressive gains.
Hence, I'm reiterating my Buy rating for Newell Rubbermaid (NYSE: NWL), first recommended on April 27, 2009 at a price of $8.08. If you bought NWL then, you're up about 60%.
The prospect for market share gains and the elimination of lower-margin products adds to Newell's positive story. The First Call FY2009/FY2010 EPS estimates for NWL are $1.27 to $1.41.
Stock Analysis: Newell Rubbermaid is a moderate risk stock. If you've already purchased the company's shares, hold them. If not, consider buying a 50% position in NWL now; then buy another 25% in three months, if U.S. and global economic conditions don't worsen substantially. Under any circumstance, don't buy more than 75% of your NWL position before October 2009. Sell/stop loss if you were to buy shares in this company: $3.
Disclosure: Lazzaro has no positions in stocks, but does own shares in two Pimco Bond Funds: PHDAX and PYMAX.
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