Energizer shares maintain Buy rating on earnings beat

EditorNatashya Angelica
Published 20/11/2024, 02:40 am
ENR
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On Tuesday, Energizer Holdings Inc. (NYSE:ENR) shares received a reaffirmation of a Buy rating and a $40.00 price target from Truist Securities. The company reported its fiscal fourth-quarter 2024 net sales at $805.7 million, slightly exceeding both Truist Securities' projection of $803.9 million and the consensus estimate of $805.6 million. Energizer's adjusted earnings per share (EPS) came in at $1.22, beating the anticipated $1.17 which matched the consensus estimate.

Energizer's performance this quarter was marked by growth in volume across both of its business segments. Additionally, the company experienced a 220 basis points expansion in adjusted gross margin, surpassing Truist Securities' prediction by 70 basis points. The results indicate a stronger-than-expected profitability for the battery manufacturer.

Looking forward to the fiscal year 2025, Energizer has provided financial guidance projecting an organic revenue increase of 1% to 2%. The company also forecasts adjusted EBITDA to be between $625 million and $645 million, with an adjusted EPS range of $3.45 to $3.65. These projections are largely in line with the Street's expectations, which anticipated an organic revenue growth of 1.5%, adjusted EBITDA of $608.4 million, and an adjusted EPS of $3.53.

According to Truist Securities, Energizer's stock is expected to open flat to up, driven by the earnings per share beat and the fiscal year 2025 guidance aligning with market expectations. The company's latest financial results and future projections are anticipated to be well-received by investors.

In other recent news, Energizer Holdings Inc. reported Q4 results that exceeded analyst expectations with an adjusted earnings per share (EPS) of $1.22, surpassing the consensus estimate of $1.17. The company's revenue was reported at $805.7 million, slightly above Wall Street's forecast of $805.59 million.

In the same vein, for the full fiscal year 2024, Energizer reported an adjusted EPS of $3.32, marking a 7% increase from the previous fiscal year, despite a 2.5% decline in revenue to $2.89 billion.

JPMorgan (NYSE:JPM) maintained its Underweight rating on Energizer with a steady price target of $32.00. The firm's analysis highlighted improved gross margins and reduced selling, general and administrative expenses (SG&A) as key factors behind the better-than-expected earnings.

Energizer's initial fiscal year 2025 guidance aligns with expectations, projecting an adjusted EPS in the range of $3.45 to $3.65, closely aligning with the analyst consensus of $3.52. The company also foresees an organic revenue growth of 1% to 2% for the new fiscal year.

Furthermore, Energizer managed to reduce its net leverage to 4.9 times in fiscal 2024, aided by a $200 million debt pay down and adjusted EBITDA growth. The company's gross margin expanded to 38.3% for the full year, up from 38% in fiscal 2023, largely attributed to benefits from its Project Momentum cost savings initiatives. These are some of the recent developments in Energizer Holdings Inc.

InvestingPro Insights

Energizer Holdings Inc.'s recent performance and future outlook are further illuminated by data from InvestingPro. The company's market capitalization stands at $2.45 billion, reflecting its significant presence in the battery and portable lighting products industry.

InvestingPro data shows that Energizer's P/E Ratio (Adjusted) for the last twelve months as of Q3 2024 is 10.3, which is considerably lower than the current P/E Ratio of 241.83. This discrepancy suggests that recent earnings adjustments have significantly impacted the company's valuation metrics.

Two relevant InvestingPro Tips highlight Energizer's financial position. First, the company's "liquid assets exceed short-term obligations," indicating a strong balance sheet and ability to meet near-term financial commitments. This aligns well with the positive quarterly results reported. Secondly, Energizer is "trading near its 52-week high," with the stock price at 99.33% of its 52-week peak. This reflects the market's positive reception of the company's recent performance and outlook, as noted in the Truist Securities analysis.

For investors seeking a deeper understanding of Energizer's financial health and market position, InvestingPro offers 11 additional tips, providing a comprehensive view of the company's strengths and potential challenges.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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