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More top-performing CAPS members are feeling bullish about Fortune Brands (NYSE: FO ) these days, enough to upgrade it from the three- and four-star rank it has held over the past year to a top-rated five stars. A total of 619 members have given their opinion on Fortune Brands, with many of them offering analysis and commentary explaining the recent optimism.
While consumers have cut spending in the recession and are making less frequent visits to stores like Home Depot (NYSE: HD ) , Lowe's (NYSE: LOW ) , or Sears Holdings (Nasdaq: SHLD ) , many CAPS members have a bullish long-term outlook on Fortune Brands' diversified portfolio of consumer products and alcoholic spirits. Despite the negative macro environment, a recent deal with KB Home (NYSE: KBH ) will help its Moen faucet sales in its home and hardware business, and the company sees growth opportunities for its golf products in Europe and Asia. Additionally, a recent survey of hospitality industry personnel shows that people still see alcoholic spirits as an affordable luxury in this economy.
In an effort to shore up its capital base, Fortune Brands announced that it is joining the long list of companies like General Electric (NYSE: GE ) and Pfizer by cutting its dividend, a move that will bring its payout ratio under that of beverage giant Diageo (NYSE: DEO ) and save $150 million annually. However, the dividend cut was accompanied by the company announcing solid operating results. It expects to blow away analysts' first-quarter earnings expectations, excluding one-time items, as all of its businesses performed at or above its expectations in the quarter. It also adjusted its 2009 free cash flow forecast, which it says could end up more than double its prior outlook.
To see what the very best CAPS analysts are saying now about Fortune Brands -- as well as other winning stocks they are picking -- head on over to CAPS and have a look. The community research and resources in CAPS are totally free, unlike analyst opinions reserved for paying clients.
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