Please ensure Javascript is enabled for purposes of website accessibility

Why EnerSys' Shares Popped 13% Last Month

By Travis Hoium – Sep 8, 2016 at 1:45PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Strong growth in the battery market had investors cheering EnerSys' stock in August.

Image source: Getty Images.

What happened

Shares of battery distributor EnerSys (ENS -0.51%) jumped an impressive 12.9% in August, according to data provided by S&P Global Market Intelligence, after reporting fiscal first-quarter results.

So what

Revenue rose 6.8% in the quarter to $600.6 million, and adjusted net income rose 7.3% to $50.1 million, or $1.14 per share. Both figures topped expectations, with the highlight being earnings topping analysts' estimate of $1.10 per share in earnings.  

As energy storage technology improves and provides more value to industrial customers, the market opportunity for EnerSys continues to grow. And with revenue and profits growing more quickly than expected, investors have raised their expectations for the future.

Now what

Electrification of industrial customers is just starting to take shape, and that creates a huge opportunity for a company like EnerSys. What investors will want to watch for is the company maintaining technology flexibility in its operations and maintaining margins in a highly competitive environment. If those two things continue, the stock has a bright future.

Travis Hoium has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Stocks Mentioned

EnerSys Stock Quote
EnerSys
ENS
$74.40 (-0.51%) $0.38

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.