Tupperware Brands (NYSE:TUP) stock tumbled 40% after it warned .
Trouble was indicated last month when the Orlando-based maker of serving containers The delay was on its credit facility.
TUP stock was trading below $1.50 per share early on April 10, dropping its market capitalization from $107 million to just $65 million.
Fall of a Post-War Star
Tupperware has been in trouble for years, as plastic containers with self-closing lids have become common in the food delivery industry. Large containers for deli meats and smaller ones for take-out food may not be as good as those and sold by direct saleswomen for decades. But most people think they’re good enough.
In recent years Tupperware has gotten a boost from post-war nostalgia. Dixie Longate of Mobile, Alabama, even launched an off-Broadway show around her “Tupperware party” , and it’s
.
TUP stock was selling for $42/share five years ago and hit a high of $33/share during the Covid-19 pandemic. But sales have been declining for years, and the company lost money in 2022. It is now facing who bought near the highs.
Tupperware management now has 30 days to file its 10-K for 2022 and regain compliance with the listing rules of the New York Stock Exchange. It says it has engaged financial advisors “to assist in securing supplemental financing” and is Violating its credit covenants means Tupperware will have to pay much more for the loans it needs to remain in business.
TUP Stock: What Happens Next?
In the near term, Tupperware became a victim of rising interest rates. In the longer term, self-sealing plastic containers have become generic, and time may have bypassed it.
On the date of publication, Dana Blankenhorn held no positions in any companies mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
