(Bloomberg) -- Newell Brands Inc., the consumer-products company that owns everything from Rubbermaid and Sharpie pens to Elmer’s glue, plummeted the most in nine years after reporting a weak back-to-school season and cutting its forecast.
The company now expects earnings to top out at $2.85 a share this year, well below the $3.05 upper limit it had predicted earlier. Core sales growth, which strips out currency effects and divestitures, will be as little as 1.5 percent.
The bleak outlook sent the shares down as much as 21 percent to $32.50, the worst intraday plunge since December 2008. That puts the stock in territory not seen since before the company was created in a merger of Newell Rubbermaid and Jarden Corp., a deal worth about $13 billion when excluding debt.
Newell, based in Hoboken, New Jersey, is suffering from a slowdown in the U.S., where big-box stores and other chains are carrying less inventory. The “unrelenting retail inventory destocking headwind” took a toll in the latest quarter, Newell Chief Executive Officer Michael Polk said on a conference call. The slow back-to-school season and Hurricane Harvey, which hurt Newell’s resin suppliers, also weighed on results.
The company also said that its baby business, which includes brands like Graco and Nuk, could be flat or down in the fourth quarter.
The shares were already down 8.2 percent this year before the latest rout.
Third-quarter earnings amounted to 86 cents a share, missing the 92-cent estimate of analysts. Core sales gained 0.4 percent in the period.
The new forecast for core sales growth this year -- 1.5 percent to 2 percent -- compares with a previous range of 2.5 percent to 4 percent.
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