Spectrum Brands (SPB) is expected to have a strong finish to fiscal year 2024 with continued, albeit slower, organic growth following a prior quarter of mid-single-digit growth, RBC Capital Markets said in a fiscal Q4 earnings preview on Tuesday.

"The setup looks promising for home and garden given healthier retail inventory levels and expected promotional lift," according to the firm.

RBC said that it sees the company's risk-to-reward profile as positive with recent improvements in fundamentals and reduced bearish sentiment. While more conservative investors might still be cautious due to broader category challenges, an update on the home and personal care separation could provide a critical boost for Spectrum's stock, according to the note.

The firm said it expects the company to guide for low-single-digit growth in fiscal 2025, which should be achievable with the potential for upward adjustments if macroeconomic conditions and categories strengthen.

RBC has an outperform rating on Spectrum's stock with a price target of $114.

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