Battery and lighting company Energizer (NYSE:ENR) reported Q4 FY2023 results beating Wall Street analysts' expectations, with revenue up 2.6% year on year to $811.1 million. Turning to EPS, Energizer made a GAAP profit of $0.27 per share, down from its profit of $0.82 per share in the same quarter last year.
Is now the time to buy Energizer? Find out by accessing our full research report, it's free.
Energizer (ENR) Q4 FY2023 Highlights:
- Revenue: $811.1 million vs analyst estimates of $794.6 million (2.1% beat)
- EPS (non-GAAP) Guidance for Q1 2024 is $0.55 at the midpoint, below analyst estimates of $0.85
- EPS (non-GAAP) Guidance for fiscal year 2024 is $3.20 at the midpoint, below analyst estimates of $3.35
- Free Cash Flow of $77.5 million, up 11.7% from the previous quarter
- Gross Margin (GAAP): 37.9%, up from 35.5% in the same quarter last year
- Organic Revenue was up 2% year on year
"The fourth fiscal quarter provided a strong finish to fiscal year 2023," said Mark LaVigne, Chief Executive Officer.
Masterminds behind the viral Energizer Bunny mascot, Energizer (NYSE:ENR) is one of the world's largest manufacturers of batteries.
Household Products
Household products companies engage in the manufacturing, distribution, and sale of goods that maintain and enhance the home environment. This includes cleaning supplies, home improvement tools, kitchenware, small appliances, and home decor items. Companies within this sector must focus on product quality, innovation, and cost efficiency to remain competitive. Household products stocks are generally stable investments, as many of the industry's products are essential for a comfortable and functional living space. Recently, there's been a growing emphasis on eco-friendly and sustainable offerings, reflecting the evolving consumer preferences for environmentally conscious options.
Sales Growth
Energizer is larger than most consumer staples companies and benefits from economies of scale, giving it an edge over its smaller competitors.
As you can see below, the company's annualized revenue growth rate of 2.5% over the last three years was mediocre for a consumer staples business.
This quarter, Energizer reported decent year-on-year revenue growth of 2.6%, and its $811.1 million in revenue topped Wall Street's estimates by 2.1%. Looking ahead, analysts expect revenue to remain flat over the next 12 months.
Our recent pick has been a big winner, and the stock is up more than 2,000% since the IPO a decade ago. If you didn’t buy then, you have another chance today. The business is much less risky now than it was in the years after going public. The company is a clear market leader in a huge, growing $200 billion market. Its $7 billion of revenue only scratches the surface. Its products are mission critical. Virtually no customers ever left the company. You can find it on our platform for free.
Organic Revenue Growth
When analyzing revenue growth, we care most about organic revenue growth. This metric captures a business's performance excluding the impacts of foreign currency fluctuations and one-time events such as mergers, acquisitions, and divestitures.
The demand for Energizer's products has been stable over the last eight quarters but fallen behind the broader sector. On average, the company has posted feeble year-on-year organic revenue growth of 1.1%.
In the latest quarter, Energizer's organic sales rose 2% year on year. By the company's standards, this growth was a meaningful deceleration from the 7.4% year-on-year increase it posted 12 months ago. We'll be watching Energizer closely to see if it can reaccelerate growth.
Key Takeaways from Energizer's Q4 Results
With a market capitalization of $2.40 billion, Energizer is among smaller companies, but its $223.3 million cash balance and positive free cash flow over the last 12 months give us confidence that it has the resources needed to pursue a high-growth business strategy.
It was good to see Energizer beat analysts' revenue expectations this quarter. That stood out as a positive in these results. On the other hand, guidance for Q1'24 and full year 2024 adjusted EPS missed expectations. Overall, the results could have been better. The company is down 2% on the results and currently trades at $33 per share.
Energizer may have had a tough quarter, but does that actually create an opportunity to invest right now? When making that decision, it's important to consider its valuation, business qualities, as well as what has happened in the latest quarter. We cover that in our actionable full research report which you can read here, it's free.
One way to find opportunities in the market is to watch for generational shifts in the economy. Almost every company is slowly finding itself becoming a technology company and facing cybersecurity risks and as a result, the demand for cloud-native cybersecurity is skyrocketing. This company is leading a massive technological shift in the industry and with revenue growth of 50% year on year and best-in-class SaaS metrics it should definitely be on your radar.
Join Paid Stock Investor Research
Help us make StockStory more helpful to investors like yourself. Join our paid user research session and receive a $50 Amazon gift card for your opinions. Sign up here.
The author has no position in any of the stocks mentioned in this report.