Black & Decker (NYSE:BDK) shared its fourth-quarter and full-year results with investors earlier in the week. Is this company a tool for long-term appreciation?

Now that I've gotten that horrible -- and probably unoriginal -- pun out of the way, let's begin at the top line, where revenues dropped 7% to $1.6 billion. Net profit from continuing operations was $95.7 million, or $1.38 per diluted share -- on a per-share basis, the growth was 9.5%. Adjusting for the exclusion of tax expenses related to foreign-earnings repatriation, earnings for the fourth quarter of 2005 actually came in at $1.90 per diluted share. On this basis, Black & Decker saw its per-share earnings drop 27%.

For the full year, sales dropped 1% to $6.4 billion. The company booked $486.1 million of net profit from continuing operations, or $6.55 per diluted share. That was only a penny above the per-share amount recorded in the previous fiscal year. If, however, you adjust the earnings in 2005 for a favorable insurance settlement, as well as for the aforementioned earnings repatriation, then the per-share amount jumps to $6.73 -- once again, this shows an earnings drop for the current year.

The declines in sales growth are disconcerting, but Black & Decker is getting one thing right: cash-flow management. Although the growth rates on both operational cash flow and free cash flow aren't ecstatically exciting -- the metrics increased 1.4% and 3.1%, respectively -- the money is nevertheless useful for such nifty things as share repurchases and dividends. Black & Decker enjoys reducing its outstanding share count; the company reported that it took 15% of its outstanding stubs back from investor hands. It certainly does help in ameliorating the effects of the challenging period that the company is currently enduring.

So we've got a management group that is acting in a shareholder-friendly way with its cash but is having trouble with growing sales and income. Are there other things to consider? Sure. Gross and operating margins are down. Cash and short-term investments declined 76%. Long-term debt is up 13.6%. Now, let's add the kicker -- the current yield on the stock is about 1.7%. Taking everything into consideration, I'm not sure this is the right time to enter into a position with the shares. This is the same conclusion I came to when I covered the company back in the fall.

I'm not handy with tools -- the closest I usually get to working with them is watching an episode of This Old House. But even I recognize the Black & Decker brand, and I'm confident that the company will be around for years to come; it's been around since the early 1900s, and it has grown into a significant global presence over the decades.

As long as there are things to build and/or fix, there will always be around-the-home projects. And companies like Stanley Works (NYSE:SWK), Danaher (NYSE:DHR), and Makita (NASDAQ:MKTAY), in addition to Black & Decker, will continue to supply items like cordless power tools, sanders, and saws -- all the necessary gadgets to complete those projects.

Judging by the company's recent reputation as far as cash flow is concerned, I would imagine that free cash will probably end up being managed in a prudent manner for the year. The marketplace for Black & Decker's products will improve over time as the housing market improves. When consumers buy homes, they tend to buy furnishings and supplies to go with those homes; when new-home sales decrease, retail stores like Home Depot tend to become more conservative with inventory levels.

Black & Decker is having problems right now -- sales are down, debt is up. Still, all is not lost with this business, as it possesses a valuable brand that has long-term viability as a cash-producing asset. Again, though, investors may want to consider putting the stock on their watch list to be on the lookout for a better yield, no matter how positively Wall Street reacted to the earnings news the other day.

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Fool contributor Steven Mallas owns none of the companies mentioned. As of this writing, he was ranked 9,337 out of 21,306 investors in the CAPS system. Don't know what CAPS is? Check it out. The Fool has a disclosure policy.