UPDATE: Stifel Nicolaus Downgrades EnerSys to Hold on Lead Price Pressure

Stifel Nicolaus reduced its rating on EnerSys ENS from Buy to Hold and removed its previous $44 price target. Stifel Nicolaus noted, "Lead commodity prices on the LME are up 25% since bottoming in mid-August. Lead represents 30-35% of EnerSys' COGS and its decline that began in mid-April, 2011 has been the major driver of recent gross margin expansion, adj. EPS growth, and earnings outperformance over the past 12 months. We expect the recent rise in lead to begin to be a gross margin headwind in March 2013 (F4Q13), and should bring down full-year gross margin in F2014 toward its normalized level of ~23%, from our estimated 24.3% in F2013." EnerSys closed at $36.08 on Wednesday.