UPDATE: BMO Capital Markets Reiterates Outperform Rating, Raises PT on Energizer Holdings
In a report published Friday, BMO Capital Markets reiterated its Outperform rating on Energizer Holdings (NYSE: ENR), and raised its price target from $83.00 to $88.00.
BMO Capital noted, “ENR reported adjusted 4Q EPS of $1.76, beating our estimate and consensus, both at $1.55, on a lower tax rate of 21% (vs. our 30%E) and lower average shares of 63.7 million (vs. our 66 million E). Sales of $1.14 billion met our forecast, as did household products of $553 million and personal care of $590 million. ENR gave details of the restructuring, which is to save $200 million pretax by FY15 (up from the prior range of $175-$200 million). FY13 guidance of $6.75-$7.00 includes savings of $25-$35 million (15% of total) and does not include share repurchases or the impact of devaluation in Venezuela. We raised our FY13 estimate for the FY12 upside and for A&P spending of ~10% of sales, a level ENR believes is right for current business conditions, that was below our estimate of ~11%. We note that as ENR doesn't plan to buy shares in FY13, the $2 billion in operating cash flow we see coming gives more fire power to FY14-FY15 outlook.”
Energizer Holdings closed on Thursday at $70.82.
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