January 8, 2011 - Jarden Corporation (JAH-NYSE) manufactures, sources, markets, and distributes consumer products worldwide. The company's Outdoor Solutions segment provides consumer lifestyle products for outdoor and outdoor-related activities, including camping and outdoor equipment; water recreation products that include inflatable boats, kayaks, and tow-behinds; fishing equipment; team sports equipment for baseball, softball, football, basketball, field hockey, and lacrosse products; alpine and nordic skiing, snowboarding, snowshoeing and in-line skating products; technical and outdoor apparel; and personal flotation devices and all-terrain vehicle gears.

Branded Consumables offers household staples, including arts and crafts paint brushes, brooms, brushes, buckets, children's card games, clothespins, collectible tins, condoms, cord, rope and twine, dusters, dust pans, feeding bottles, fencing, fire extinguishing products, firelogs and firestarters, home canning jars and accessories, kitchen matches, mops, other craft items, pacifiers, plastic cutlery, playing cards and accessories, rubber gloves and related cleaning products, safes, security cameras, security doors, smoke and carbon monoxide alarms, soothers, sponges, storage organizers and workshop accessories, teats, toothpicks, window guards, and other accessories.

It sells through club stores, craft stores, direct-to-consumer channels, department stores, drugstores, grocery retailers, home improvement stores, mass merchandisers, online, specialty retailers, and wholesalers. Jarden Corporation was founded in 1991 and is headquartered in Rye, New York.

Here are just a few of the brand names Jarden owns: Diamond matches, Bicycle (cards), First Alert (alarm systems), Crockpot, Foodsaver, Coleman (camping equipment), K2 (skiis and ski equipment), Volkl skiis) Marmot, Penn (fishing reels), Rawlings (sports gear), Shakespeare fishing rods, Mr. Coffee, Oster, Sunbeam. It has many more. About 42% of sales in 2010 were from products of the Outdoor group, 31% from Consumer Solutions, 22% from Branded Consumables, and 5% from Process Solutions.

Analysts thinks profits will more than double this year, going to $2.60 from $1.19 with sales growing by 10% to 15%. Consumables were the main driver, but cost controls also helped as well as integration of acquisitions. To continue its success, management is focused on strengthening its product lines and bringing new products and extending brands. It's also marketing more to international regions, spreading its global footprint.

To help bring down costs, the company relocated manufacturing for several of its lines from Asia to South America. Higher wages and benefits in China prompted the move. While this lowers some of the costs, others, like raw materials and input costs, are increasing. Margins may be squeezed at times as materials have volatility in their pricing.

One of the attractive attributes of JAH has been the stock's relative price stability. Even with the market moving rapidly, up and down, in the last several months, the stock has traded in a rather tight range. If management can deliver on expected earnings (maybe a little higher since the company beat estimates for the last 4 quarters: 6.2%, 29%,1.1% and 7.3% respectively), it may be the catalyst the stock needs to break out of its trading range and move to higher levels.

A red flag that waves is the amount of debt JAH carries. It's 61% of the capital structure. While interest rates are low now and it's a benefit, the company will most likely want to pare borrowings back as rates start to rise. If it doesn't, interest payments will take more and more away from profits.

- Essential Numbers:
- Market Cap: $2.71 billion
- Price to book: 1.43
- Operating margin: 9.18%
- Profit margin: 3.48%
- Return on assets: 5.46%
- Revenues for the last 12 months: $6.63 billion
- Total cash: $446.3 million
- Cash per share: $4.92
- Total debt: $3.19 billion
- Current ratio: 2.39
- Book value per share: $21.05
- Beta: 1.55
- 52 week change: - 8.03%
- Shares Outstanding: 90.8 million
- Float: 85.43 million
- Held by insiders: 5.59%
- Held by institutions: 92.3%
- Annual dividend: 35 cents

There's a lot of good at Jarden, and there are some areas of concern (like heavy debt and thinner margins). Investors who see the economy improving will find this stock of interest as sales will definitely improve as consumers get more confident and spend on leisure as well as necessary items.

- Company Web site: www.jarden.com

    Ted Allrich