NYSE:ENS

Stock Analysis Report

Executive Summary

EnerSys manufactures, markets, and distributes industrial batteries.

Rewards

PE ratio (17.8x) is below the US market (18.9x)

Earnings are forecast to grow 18.98% per year

Earnings grew by 46.9% over the past year

Risk Analysis

Debt is not well covered by operating cash flow

Large one-off items impacting financial results



Snowflake Analysis

Fair value with acceptable track record.


Similar Companies

Share Price & News

How has EnerSys's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: ENS has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-2.7%

ENS

-1.2%

US Electrical

-1.3%

US Market


1 Year Return

-12.7%

ENS

21.6%

US Electrical

22.0%

US Market

Return vs Industry: ENS underperformed the US Electrical industry which returned 24.7% over the past year.

Return vs Market: ENS underperformed the US Market which returned 24.7% over the past year.


Shareholder returns

ENSIndustryMarket
7 Day-2.7%-1.2%-1.3%
30 Day-3.0%0.2%1.8%
90 Day7.3%10.0%9.3%
1 Year-11.7%-12.7%24.2%21.6%24.6%22.0%
3 Year-4.6%-7.4%35.2%27.3%49.2%39.6%
5 Year32.5%25.8%59.0%43.0%77.9%58.3%

Price Volatility Vs. Market

How volatile is EnerSys's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is EnerSys undervalued compared to its fair value and its price relative to the market?

17.54x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: ENS ($74.69) is trading above our estimate of fair value ($66.34)

Significantly Below Fair Value: ENS is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: ENS is good value based on its PE Ratio (17.8x) compared to the Electrical industry average (18x).

PE vs Market: ENS is good value based on its PE Ratio (17.8x) compared to the US market (18.9x).


Price to Earnings Growth Ratio

PEG Ratio: ENS is good value based on its PEG Ratio (0.9x)


Price to Book Ratio

PB vs Industry: ENS is overvalued based on its PB Ratio (2.4x) compared to the US Electrical industry average (1.8x).


Next Steps

Future Growth

How is EnerSys forecast to perform in the next 1 to 3 years based on estimates from 3 analysts?

19.0%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: ENS's forecast earnings growth (19% per year) is above the savings rate (1.7%).

Earnings vs Market: ENS's earnings (19% per year) are forecast to grow faster than the US market (14.3% per year).

High Growth Earnings: ENS's earnings are forecast to grow, but not significantly.

Revenue vs Market: ENS's revenue (6.7% per year) is forecast to grow slower than the US market (7.5% per year).

High Growth Revenue: ENS's revenue (6.7% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: Insufficient data to determine if ENS's Return on Equity is forecast to be high in 3 years time


Next Steps

Past Performance

How has EnerSys performed over the past 5 years?

-2.0%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: ENS has a large one-off loss of $67.7M impacting its September 29 2019 financial results.

Growing Profit Margin: ENS's current net profit margins (5.9%) are higher than last year (4.5%).


Past Earnings Growth Analysis

Earnings Trend: ENS's earnings have declined by -2% per year over the past 5 years.

Accelerating Growth: ENS's earnings growth over the past year (46.9%) exceeds its 5-year average (-2% per year).

Earnings vs Industry: ENS earnings growth over the past year (46.9%) exceeded the Electrical industry 4.2%.


Return on Equity

High ROE: ENS's Return on Equity (13.5%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is EnerSys's financial position?


Financial Position Analysis

Short Term Liabilities: ENS's short term assets ($1.6B) exceed its short term liabilities ($565.6M).

Long Term Liabilities: ENS's short term assets ($1.6B) exceed its long term liabilities ($1.4B).


Debt to Equity History and Analysis

Debt Level: ENS's debt to equity ratio (86.5%) is considered high.

Reducing Debt: ENS's debt to equity ratio has increased from 39% to 86.5% over the past 5 years.

Debt Coverage: ENS's debt is not well covered by operating cash flow (19.2%).

Interest Coverage: ENS's interest payments on its debt are well covered by EBIT (7.2x coverage).


Balance Sheet

Inventory Level: ENS has a high level of physical assets or inventory.

Debt Coverage by Assets: ENS's debt is covered by short term assets (assets are 1.4x debt).


Next Steps

Dividend

What is EnerSys's current dividend yield, its reliability and sustainability?

0.95%

Current Dividend Yield


Dividend Yield vs Market

company1.0%marketbottom25%1.4%markettop25%3.7%industryaverage2.2%forecastin3Years1.0%

Current dividend yield vs market & industry

Notable Dividend: ENS's dividend (0.94%) isn’t notable compared to the bottom 25% of dividend payers in the US market (1.4%).

High Dividend: ENS's dividend (0.94%) is low compared to the top 25% of dividend payers in the US market (3.66%).


Stability and Growth of Payments

Stable Dividend: Whilst dividend payments have been stable, ENS has been paying a dividend for less than 10 years.

Growing Dividend: ENS's dividend payments have increased, but the company has only paid a dividend for 7 years.


Current Payout to Shareholders

Dividend Coverage: With its low payout ratio (16.7%), ENS's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: Insufficient data to determine if a dividend will be paid in 3 years and that it will be covered by earnings.


Next Steps

Management

What is the CEO of EnerSys's salary, the management and board of directors tenure and is there insider trading?

4.0yrs

Average management tenure


CEO

Dave Shaffer (54yo)

3.8yrs

Tenure

US$5,208,103

Compensation

Mr. David M. Shaffer, also known as Dave, has been Director and Chief Executive Officer of EnerSys since April 2016 and has been its President since November 2014 and was its Chief Operating Officer since  ...


CEO Compensation Analysis

Compensation vs Market: Dave's total compensation ($USD5.21M) is about average for companies of similar size in the US market ($USD4.99M).

Compensation vs Earnings: Dave's compensation has been consistent with company performance over the past year.


Management Age and Tenure

4.0yrs

Average Tenure

54yo

Average Age

Experienced Management: ENS's management team is considered experienced (4 years average tenure).


Board Age and Tenure

4.8yrs

Average Tenure

64.5yo

Average Age

Experienced Board: ENS's board of directors are considered experienced (4.8 years average tenure).


Insider Trading

Insider Buying: ENS insiders have only sold shares in the past 3 months.


Recent Insider Transactions

SellUS$399,62526 Nov 19
Holger Aschke
EntityIndividual
Role
Senior Key Executive
President of Europe
Shares5,750
Max PriceUS$69.50
SellUS$1,696,67313 Feb 19
Todd Sechrist
EntityIndividual
Shares24,039
Max PriceUS$70.58

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Management Team

  • Drew Zogby (58yo)

    President of Energy Systems Americas

    • Tenure: 0.8yrs
  • Michael Schmidtlein (58yo)

    CFO & Executive VP of Finance

    • Tenure: 9.9yrs
    • Compensation: US$1.97m
  • Dave Shaffer (54yo)

    CEO, President & Director

    • Tenure: 3.8yrs
    • Compensation: US$5.21m
  • Jörn Tinnemeyer

    Senior VP & CTO

    • Shawn O'Connell (46yo)

      President of Motive Power Americas

      • Tenure: 0.8yrs
    • Kerry Kane

      VP & Corporate Controller

      • Tenure: 9.6yrs
    • Thomas O'Neill

      VP of Investor Relations & Treasurer

      • Tenure: 9.6yrs
    • Holger Aschke (50yo)

      President of Europe

      • Tenure: 4yrs
      • Compensation: US$1.34m
    • Joseph Lewis

      Senior VP

      • Patrice Baumann

        Senior VP of Operations & Supply Chain


        Board Members

        • John Lehman (76yo)

          Independent Director

          • Tenure: 15.4yrs
          • Compensation: US$254.23k
        • Paul Tufano (65yo)

          Independent Director

          • Tenure: 4.8yrs
          • Compensation: US$253.00k
        • Dennis Marlo (76yo)

          Independent Director

          • Tenure: 15.4yrs
          • Compensation: US$254.23k
        • Howard Hoffen (56yo)

          Lead Director

          • Compensation: US$219.32k
        • Hwan-yoon Chung (45yo)

          Independent Director

          • Tenure: 13.9yrs
          • Compensation: US$220.82k
        • Arthur Katsaros (71yo)

          Independent Non-Executive Chairman

          • Tenure: 3.7yrs
          • Compensation: US$424.32k
        • Ron Vargo (64yo)

          Independent Director

          • Tenure: 2.4yrs
          • Compensation: US$247.00k
        • Nelda Connors (53yo)

          Independent Director

          • Tenure: 2.4yrs
          • Compensation: US$228.32k
        • Bob Magnus (72yo)

          Independent Director

          • Tenure: 11.5yrs
          • Compensation: US$238.63k
        • Dave Shaffer (54yo)

          CEO, President & Director

          • Tenure: 3.8yrs
          • Compensation: US$5.21m

        Company Information

        EnerSys's company bio, employee growth, exchange listings and data sources


        Key Information

        • Name: EnerSys
        • Ticker: ENS
        • Exchange: NYSE
        • Founded: 1999
        • Industry: Electrical Components and Equipment
        • Sector: Capital Goods
        • Market Cap: US$3.112b
        • Shares outstanding: 42.29m
        • Website: https://www.enersys.com

        Number of Employees


        Location

        • EnerSys
        • 2366 Bernville Road
        • Reading
        • Pennsylvania
        • 19605
        • United States

        Listings

        TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
        ENSNYSE (New York Stock Exchange)YesCommon StockUSUSDJul 2004
        FDNDB (Deutsche Boerse AG)YesCommon StockDEEURJul 2004

        Biography

        EnerSys manufactures, markets, and distributes industrial batteries. The company offers battery chargers, power equipment, battery accessories, and outdoor cabinet enclosures, as well as related after-market and customer-support services for industrial batteries. It also provides reserve power products that are used for backup power for the continuous operation of critical applications in telecommunications systems, uninterruptible power systems applications for computer and computer-controlled systems, and other specialty power applications, including medical and security systems, premium starting, lighting, and ignition applications, as well as in switchgear, electrical control systems used in electric utilities, large-scale energy storage, energy pipelines, commercial aircraft, satellites, military aircraft, submarines, ships, and tactical vehicles. The company’s reserve power products also include thermally managed cabinets and enclosures for electronic equipment and batteries. In addition, it offers motive power products that are used to provide power for electric industrial forklifts used in manufacturing, warehousing, and other material handling applications, as well as mining equipment, diesel locomotive starting, and other rail equipment. The company sells its products through a network of distributors, independent representatives, and internal sales forces in North and South America, Europe, the Middle East, Africa, Asia, Australia, and Oceania. The company was formerly known as Yuasa, Inc. and changed its name to EnerSys in January 2001 to reflect its focus on the energy systems business. EnerSys was founded in 1999 and is headquartered in Reading, Pennsylvania. 


        Company Analysis and Financial Data Status

        All financial data provided by Standard & Poor's Capital IQ.
        DataLast Updated (UTC time)
        Company Analysis2020/01/25 00:14
        End of Day Share Price2020/01/24 00:00
        Earnings2019/09/29
        Annual Earnings2019/03/31


        Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.