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The DeWalt FlexVolt Could Be a Game-Changer for SWK in 3Q16 Onward

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Jul. 27 2016, Updated 11:08 a.m. ET

SWK unveils the DeWalt FlexVolt

In June 2016, Stanley Black & Decker (SWK) introduced the DeWalt FlexVolt, which is the world’s first convertible battery pack that changes voltage when you change tools. Users can switch tools with a 20-volt rating to those with a 60-volt or 120-volt rating using the same battery pack.

SWK’s introduction of 120 volts of cordless power is likely to be extremely popular. For example, miter saws and table saws required users to use a conventional AC plug, as conventional battery packs didn’t have enough power for normal operation. SWK also made this product backward compatible with its existing lineup of 20-volt products.

The FlexVolt is expected to hit stores by October and is likely to be a game-changer in the company’s Tools business. FlexVolt aims to eliminate the cord and achieve flexibility in switching tools without worrying about voltage compatibility.

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Marketing campaign

Stanley Black & Decker (SWK) launched a global and comprehensive marketing campaign for FlexVolt as a part of its Commercial Excellence initiative. The company initiated a digital marketing campaign and created enormous buzz on social media as the product hits stores in October 2016.

SWK has demonstrated the technology to over 700 customers such as retailers (XRT) and distributors.

Expected sales

Generally, Stanley Black & Decker’s new product launches generate sales of approximately $100 million in a three-year period. However, given how exciting they believe the FlexVolt technology to be, the company expects to generate $50 million–$60 million this year after the product hits the shelves in October.

Depending on the success of the launch, the company sees the patent-protected technology generating around $200 million in 2017.

Key ETFs

Investors interested in trading in the industrial space could look into the Guggenheim S&P 500 Equal Weight Industrials ETF (RGI), and those interested in trading in dividend-based ETFs could consider the ProShares S&P 500 Dividend Aristocrats ETF (NOBL).

Major holdings in NOBL are Nucor (NUE) and Archer Daniels Midland Company (ADM), with respective weights of 2% and 2.1%.

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