The Case for and Against Fortune Brands Home & Security, Inc. (FBHS)

Fortune Brands Home & Security, Inc. (FBHS) is an interesting player in the Consumer Goods space, with a focus on Home Furnishings & Fixtures. The stock has been active on the tape, currently trading at $64.35, down from yesterday’s close by -1.39%. Given the stock’s recent action, it seemed like a good time to take a closer look at the company’s recent data.

Fundamental Analysis

Money managers are always interested in a company that can find the right recipe of fundamental data because it reflects something important going on underneath the surface. Fortune Brands Home & Security, Inc. (FBHS) currently trades with a market capitalization of $9.87 Billion. That value represents a market adjusting for revenues that have been growing by 5.21 % on a quarterly year/year basis as of the company’s last quarterly report.

The balance sheet health of any company plays a key role in its ability to meet its obligations and maintain the faith of its investment base. For FBHS, the company currently has $252.7 Million of cash on the books. You can get a sense of how sustainable that is by a levered free cash flow of $522.6 Million over the past twelve months. Generally speaking, earnings are expected to fall in coming quarters. Analysts are forecasting earnings of $0.83 on a per share basis this quarter. Perhaps, that suggests something about why 83.74% of the outstanding share supply is held by institutional investors.

Technical Analysis

Sometimes, we can understand most about a stock by simply looking at how it has been trading. Looking at the stock’s movement on the chart, Fortune Brands Home & Security, Inc. recorded a 52-week high of $67.50. It is now trading 3.15% off that level. The stock is trading $65.18 its 50-day moving average by 0.83000000000001%. The stock carved out a 52-week low down at $52.05.

In recent action, Fortune Brands Home & Security, Inc. (FBHS) has made a move of -3.32% over the past month, which has come on weak relative transaction volume. Over the trailing year, the stock is underperforming the S&P 500 by 13.43, and it’s gotten there by action that has been more volatile on a day-to-day basis than most other stocks on the exchange. In terms of the mechanics underlying that movement, traders will want to note that the stock is trading on a float of 2.80% with $152.34 Million sitting short, betting on future declines. That suggests something of the likelihood of a short squeeze in shares of FBHS.