What happened

Shares of Energizer Holdings (NYSE:ENR) surged as much as 19.1% higher on Wednesday morning, lifted by an impressive fourth-quarter earnings report. By 10:35 a.m. EST, the stock had settled down to a milder 12.1% gain. As a reminder, this is the maker of well-known battery brands like Energizer and Rayovac, as well as car-care products under names such as Armor All and STP.

So what

Energizer's fourth-quarter sales rose 57% year over year, mostly thanks to the buyouts of Spectrum Brands' (NYSE:SPB) battery and car-care operations in two separate deals, both of which closed in January of 2019, with a combined price tag of $3.25 billion. Adjusted earnings increased by 12% to $0.93 per share. Your average Wall Street analyst would have settled for earnings near $0.81 per share on sales in the neighborhood of $713 million.

A large pile of colorful AA batteries, seen from the plus-contact side.

Image source: Getty Images.

Now what

These results were impressive enough that investors forgave Energizer for issuing soft earnings guidance for the next fiscal year. The integration process appears to be running rather smoothly, but there's also a big downside to that story. The company is struggling under the weight of $2.5 billion in acquisition-related debt, which more than doubled Energizer's full-year interest expenses compared to 2018.

This isn't my favorite consumer goods stock by a long shot, but I do see value in the Spectrum Brands deals -- if the company can start to reduce the debt load someday soon.