Why Shares in Stanley Black & Decker Soared in June
Shares of tools and industrial products company Stanley Black & Decker (NYSE: SWK) rose by 25% in June, according to data provided by S&P Global Market Intelligence. The move came after a series of well-received presentations by the company's Executive Vice President and Chief Financial Officer, Pat Hallinan, at three industrial investors conferences earlier in the month.
In a nutshell, Hallinan told investors what they wanted to hear regarding the two most important near and medium-term considerations on the stock. Its inventory reduction plans are on track for 2023, and its plan to generate run-rate savings of $2 billion by 2025 is on track.
Management's plan to reduce inventory by $750 million to $1 billion in 2023 is vital to its turnaround strategy. As you can see below, the number of days it holds inventory before selling it has soared recently. A combination of a natural sales correction following the DIY boom during the lockdowns and the impact of rising interest rates on housing and DIY activity led to soaring inventory. As such, it's good to see management's inventory plans are on track.
Source Fool.com
