Summary
Newell Brands has bounced nearly 50% from its recent lows at $15.00.
Despite this violent rally, there is no confirmation of a turnaround in place from a technical nor fundamental standpoint.
For shorter-term traders, this looks to be an opportune time to take profits as we approach the $22.00 level.
The seemingly never-ending skid in Newell Brands' (NWL) share price finally screeched to a halt last month, and thus far the recovery has been impressive. For those that were fortunate enough to be picking up the stock below the $20.00 level, it's certainly been a welcome surprise. For the majority of value investors that have been nibbling at the stock since $35.00, the uphill battle to break-even rages on. The trouble with this recent rally is that it has come more from an overdue technical bounce than it has a large fundamental change. While the hemorrhaging in earnings and sales growth stopped, confirmed turnarounds typically come with a surge in earnings growth which allows the trend to make an intermediate high. It's entirely possible the stock can continue higher here with momentum at its back currently, but the reward/risk seems to have leveled off at the $21.85 area for traders.
(Source: Author's Photo)
