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Canaccord Genuity started off coverage on five different consumer product stocks on Thursday. Buy ratings were doled out on Driven Brands (DRVN), Holley (HLLY), Lifetime Brands (LCUT), and Spectrum Brands (NYSE:SPB) - while coverage on Reynolds Consumer Product (REYN) was initiated with a Hold rating.
Driven Brands (DRVN) was noted to be the largest auto services company in North America with a growing and highly franchised base of 4,805 locations. The company is seen just scratching the surface of its growth potential.
Holley (HLLY) was called a leading manufacturer of automotive aftermarket products for car enthusiasts, including fuel-injection systems, carburetors, engine products and exhaust systems for high-performance cars. Canaccord thinks the company will continue to gain share both organically and via M&A. The stock is called attractive with investors' expectations low.
Lifetime Brands (LCUT) was noted to be the #1 player in North American non-electric housewares, a significantly fragmented market with >2K competitors in the U.S. Growth is expected to resume for LCUT and the company is seen gaining share both organically and inorganically
Spectrum Brands (SPB) was viewed positively with the company anticipated to pay down debt and turn to more tuck-in type deals across GPC and H&G. Canaccord thinks a leaner, more focused, and higher margin/growth company should produce more predictable results and lead to a higher trading multiple.
Meanwhile, the Canaccord view on Reynolds Consumer Products (REYN) was more cautious with a Hold rating pushed out. The firm's enthusiasm for the REYN brand portfolio is offset by a volatile earnings profile that is often dependent on commodity prices.
Compare growth, profitability, and valuations metrics on DRIV, SPB, HLLY, LCUT, and REYN.