What happened
Shares of battery manufacturer Energizer Holdings (ENR 1.71%) short-circuited in early Thursday trading, dropping 11.1% through 10:40 a.m. EST. The sell-off came in response to adjusted fourth-quarter earnings that came in below consensus this morning.
Analysts had forecast Energizer would earn $0.81 per share, pro forma, on sales of $747.2 million. In fact, Energizer beat that revenue forecast, collecting $763 million, but its earnings came up short at $0.59 per share, pro forma.
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So what
Pro forma results also appear to overstate Energizer's profit, as the company suffered a quarterly loss of $0.67 per share when earnings are calculated according to generally accepted accounting principles (GAAP). For the year, however, Energizer remained profitable at $0.44 per share on a GAAP basis.
Sales for the fourth fiscal quarter grew a better-than-expected 6% in comparison to last year's final quarter, although this was a deceleration from the 10% sales growth Energizer enjoyed for the year as a whole.
Now what
Looking ahead to the fiscal year 2021 now underway, Energizer gave new guidance for sales growth ranging from 2% to 4%. Management did not give a GAAP earnings estimate for 2021, but did say that its adjusted earnings per share will range from $2.95 to $3.25. At the midpoint, this appears likely to fall short of analysts' projected $3.13. In addition to the Q4 earnings miss, this gives investors a second reason to want to sell Energizer stock today.
