Energizer Holdings (ENR) has seen its stock drift lower over the past month, sliding around 4%. With the company showing modest annual revenue and profit growth, investors may be eyeing longer-term trends instead of short-term moves.
Energizer Holdings’ shares have lost momentum recently, with a 1-day share price return of -1.53% and a 30-day slide of -4.06%. That drop caps a challenging start to the year, as its year-to-date share price return stands at -31.00%. Looking at the bigger picture, the one-year total shareholder return is down -26.67%. This highlights that market sentiment remains cautious even as the company reports steady revenue and profit growth.
Given a share price trading nearly 22% below analyst targets and ongoing profit growth, is Energizer Holdings currently undervalued? Or is the market already factoring in the company's outlook for the years ahead?
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Price-to-Earnings of 6.5x: Is it justified?
Energizer Holdings trades at a price-to-earnings (P/E) ratio of 6.5x, a level well below both its peer average and the broader Household Products industry average. With a recent closing price of $23.88, the stock appears attractively valued relative to competitors based on this metric.
The P/E ratio measures how much investors are willing to pay per dollar of current earnings. For established consumer goods companies like Energizer, it reflects expectations for future profit growth or risks in sustaining those profits. A lower multiple can mean the market is skeptical of future growth, or it may signal an overlooked value opportunity if strong profits continue.
Energizer’s P/E of 6.5x compares favorably to the peer group at 18.5x and the global industry average of 17.7x, highlighting a considerable discount. It also sits well below the estimated fair P/E of 17.1x, which may point to potential upside if sentiment or results shift to match higher market levels.
Another View: The SWS DCF Model Puts Undervaluation in a New Light
While valuation based on earnings multiples shows Energizer trading at a steep discount, our DCF model presents an even more dramatic picture. According to the SWS DCF analysis, shares trade 78% below estimated fair value, which suggests significant potential upside if the company can deliver steady long-term performance.
If you see the data differently or want to reach your own conclusions, you can build a narrative around Energizer Holdings’ story for yourself in just a few minutes. Do it your way
A great starting point for your Energizer Holdings research is our analysis highlighting 4 key rewards and 2 important warning signs that could impact your investment decision.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data
and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your
financial situation. We aim to bring you long-term focused analysis driven by fundamental data.
Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
Simply Wall St has no position in any stocks mentioned.
Valuation is complex, but we're here to simplify it.
Discover if Energizer Holdings might be undervalued or overvalued with our detailed analysis, featuring fair value estimates, potential risks, dividends, insider trades, and its financial condition.
