3 Household Stocks to Renovate Your Portfolio: The Valspar Corporation (VAL), Pool Corporation (POOL), Tile Shop Hldgs, Inc. (TTS)

Published on March 15, 2013 at 5:29 pm by The Motley Fool in News

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Earlier in March Bloomberg mentioned the ‘frugality psyche’ in the minds of home owners today. I believe this only helps Pool Corporation (NASDAQ:POOL) because home owners are trying to improve the value of their homes by installing a pool. It also is a long-term investment, as pools provide years of entertainment for everyone in the family and can be an attraction point when selling a home later down the road. The company known for selling “everything but the water” has over 300 locations worldwide, and the stock is up over 30% the past 12 months and over 144% the past 5 years.

Net sales for the year ended Dec. 31, 2012, increased 9% to a record high of $1.95 billion. EPS also jumped 23% to a record $1.85/share. 2013 guidance is expected to break records again, with EPS estimates by the company for $2.13 to $2.23/share. Furthermore, the company is in hiring mode, which is somewhat rare in today’s job market, which to me only screams that investors should look to jump into the water.

The Valspar Corporation (NYSE:VAL)

A global coating and paint manufacturer distributor, The Valspar Corporation (NYSE:VAL) can possibly paint a different picture for your portfolio. The stock is up over 30% the past 12 months and over 214% the past 5 years, not including dividends. I prefer Valspar over Sherwin-Williams only because of the potential to grow more since its market cap is nearly a third that of Sherwin-Williams and has a smaller P/E ratio.

The Valspar Corporation (NYSE:VAL) has been getting a bad rap lately after missing earnings in their most recent quarter, resulting in a 1.3% decline in net income. While profit margins have been dropping slightly in recent quarters, it is still higher than the company’s 5 year average of 4.16%. In December 2012, Valspar purchased Ace Hardware Corporations’ paint manufacturing business for $34.8 million. Earlier this month former Best Buy CFO James Muehlbauer was named the new CFO of Valspar. I think these changes show that the company is putting itself in a position for long-term success while staying true to what has allowed them to exist for the past 200+ years.