By Dan Mitchell, MLM Blog Correspondent
From Investors.com:
The small but feisty housewares industry group has edged consistently higher in a tough market. The group has planted itself squarely among IBD's top 10 industries, up from a ranking of 195 just six weeks ago.
Tupperware (TUP) has given the group the biggest push, rising 224% since turning up from a bottom on March 6.
The company sees two-thirds of its sales and profit from the traditional Tupperware segment, the other third from its beauty products business. The bulk of Tupperware's sales are in Europe, followed by Asia. North America accounted for about 20% of Tupperware segment sales, and for sales of nearly all the beauty products.
Tupperware's overall sales declined for the past three quarters. Earnings turned up in the second quarter, rising 15% — well above expectations.
Part of that surprise came from a sharp decline in oil prices in June, and the ongoing slide that has pressed natural gas prices to seven-year lows. Oil and natural gas are the basic inputs for Tupperware's plastic resins.
At the end of the second quarter, Tupperware said it expected cost benefits in the range of $14 million due to resin cost changes this year as compared with 2008.
An Aug. 31 report from Morgan Stanley maintained an overweight rating with a price target of 44 for the stock.
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