You probably have Unilever products sitting in your kitchen, bathroom, and laundry room right now. From Dove to Hellmann’s, their brands are everywhere - but their stock hasn’t exactly been on fire lately. That might be about to change.

A bold leadership shakeup is giving us new reasons to pay attention. With strong fundamentals, a discount valuation, and a new CEO ready to unlock value, Unilever is setting up as a smart long play with room to run.

We’ll cover:

• Why Unilever is a Buy at current levels

• How to generate income with a covered call strategy

Stock Breakdown: Unilever

Why the CEO Change Matters

On February 25, Unilever announced that CEO Hein Schumacher is stepping down, to be replaced by current CFO Fernando Fernandez. But this isn’t just a title swap—it’s a strategy shift.

✅ Fernandez’s Edge: As former head of the Beauty & Wellbeing division (one of UL’s fastest-growing), and past CEO of Brazil and the Philippines ops, Fernandez brings proven operational excellence.

✅ Board Endorsement: The board praised his “decisive and results-oriented approach” and signaled aggressive execution ahead.

✅ Accelerated Growth Plan: The “Growth Action Plan” is getting a turbo boost under Fernandez.

Financial Foundation Remains Strong

Despite recent noise, Unilever is in solid financial shape:

💰 Revenue: $60.76B with 4.2% underlying sales growth

💸 Operating Margin: 17.28% (with clear upside)

📈 Profit Margin: 9.45%

💵 Cash Flow: $9.52B in operating cash flow

📊 Dividend Yield: 3.16% forward

What stands out is the margin expansion potential. P&G runs at 22.9%-even halfway there puts a major earnings boost on the table.

Valuation: A Deep Discount vs. Peers

Unilever looks cheap across the board:

⚖️ Forward P/E: 17.24x (vs. P&G’s 23.10x)

🏷️ Price/Sales: 2.24x (vs. 4.50x)

🧮 EV/EBITDA: 13.39x (vs. 17.60x)

This gives us margin of safety plus potential for multiple expansion as results improve.

Technical Picture

Momentum is on UL’s side:

✅ Strong support at $54.99

✅ Trading above the 50-day MA ($57.23)

✅ Up +18.58% YoY, beating the S&P’s +8.19%

✅ Currently at $58.65, with a breakout above $60.00 potentially targeting $65.00–$70.00

Trade Of The Week

Buy the Stock + Generate Income with a Covered Call

We’re bullish on UL and see both long-term upside and short-term income potential. Here's the two-part play:

🟢 Buy Unilever (UL) at $58.65

This is your core long position, based on strong fundamentals, margin expansion potential, and a catalyst-rich leadership change.

✍️ Sell the April 17th $60 Call for $0.60

This covered call strategy lets you generate income while you wait for the breakout.

Why this works:

1. Get paid $0.60/share now

2. Capitalize on the technical resistance at $60

3. If UL stays below $60, keep the premium and re-sell another call

4. If UL rises above $60, your shares get called away at a profit - both from the share appreciation and the option premium

5. Either way, you're generating returns while the longer-term thesis plays out

📈 Total upside if called away: $1.35 per share gain ($1.35 = $60.00 strike – $58.65 entry + $0.60 premium)

📉 Effective cost basis if not called: $58.05

💡 Smart income while waiting for long-term growth.

Risk Management Tip

Set a stop-loss at $54.99, the technical support level, to manage downside while preserving upside potential.

Conclusion…

Unilever isn’t just a consumer staples stock-it’s a turnaround story in motion. With a proven operator stepping into the CEO role, strong cash flow, margin upside, and nearly 20% analyst price target upside, UL offers a rare combo of dividend income and capital appreciation.

📈 Buy UL at $58.65

💸 Sell April 17th $60 Calls for $0.60

📉 Stop at $54.99

🏁 Target: $70.00

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Sincerely,
The Resilient Trader