The Motley Fool Previous Page

Jarden's Simmering Improvements

W.D. Crotty
January 12, 2006

Shares of branded-consumer-products company Jarden (NYSE: JAH  ) have been on a tear for the last three years, rising from $3 to $42. The company's stated goal to double 2004's adjusted earnings of $1.47 by 2008 certainly hasn't hurt that rise.

Yet the stock is setting a new 52-week low of $26.50 Thursday, after the company announced that it hit a bump in its latest quarter. Analysts expected Jarden to earn $2.24 for the year. Instead, the company expects 2005 earnings to fall between $2.10 and $2.14 a share.

Blame for the shortfall partly rests with lower-than-expected results at the recently acquired Holmes units, owner of such brands as Crock-Pot slow-cookers, Rival roasters, and Bionaire air purifiers. Also falling short was the company's core FoodSaver line.

Fool contributor Brian Gorman sounded a cautionary note in June. He noted the significant increase in the company's long-term debt needed to fund two major acquisitions in seven months, and the related business impact of trying to integrate these back-to-back buys into its operations. The caution was justified -- as was his outlook that Jarden's was a winner.

True, the stock has been deflated by today's bad news. But base