ENR - Energizer: Lacking Energy Here

2024-04-02 15:32:39 ET

Summary

• Energizer Holdings, Inc.'s acquisition of Spectrum Brands' battery business in 2018 has not yielded the expected earnings growth.
• This deal, and even another deal with Spectrum, were not sufficient to deliver on the pro forma projections from the first deal.
• Despite a low adjusted earnings multiple, negative organic growth and a high leverage ratio make investing in Energizer quite risky.

When Energizer Holdings, Inc. ( ENR ) announced its intention to acquire the battery business of Spectrum Brands (SPB) in 2018, the company was setting up to create a battery giant. Greater market power and costs synergies should in theory create a stronger business, yet lack of growth and a 5 times leverage ratio created real reasons to be concerned as well....

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