What Happened?

Shares of battery and lighting company Energizer (NYSE:ENR) fell 5.7% in the morning session after the company reported weak fourth-quarter results: Its EPS guidance for next quarter fell short of Wall Street's estimates. Also, the FY 2025 sales forecast implied weak growth in the low single-digit range, which is unlikely to impress investors and Wall Street. On the other hand, Energizer exceeded analysts' organic revenue estimates during the quarter. The market seemed to focus on the negatives and the stock is down.

The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Is now the time to buy Energizer? Access our full analysis report here, it’s free.

What The Market Is Telling Us

Energizer’s shares are not very volatile and have only had 4 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business. 

The biggest move we wrote about over the last year was 3 months ago when the stock gained 13.1% on the news that the company reported impressive third-quarter results, which beat Wall Street's organic revenue and EBITDA estimates. The top-line growth was broad-based, with increased volume in the Battery and Auto Care segments. This helped the company's growth narrative as sales growth turned slightly positive. Looking ahead, the company provided encouraging guidance, forecasting fiscal 2025 organic revenue growth of 1% to 2%. Adjusted EBITDA for the same period also came in ahead of Wall Street's expectations. Overall, this was an impressive quarter, highlighting top and bottom-line improvements.

Energizer is down 6.9% since the beginning of the year, and at $32.23 per share, it is trading 18.2% below its 52-week high of $39.39 from December 2024. Investors who bought $1,000 worth of Energizer’s shares 5 years ago would now be looking at an investment worth $640.55.

Today’s young investors likely haven’t read the timeless lessons in Gorilla Game: Picking Winners In High Technology because it was written more than 20 years ago when Microsoft and Apple were first establishing their supremacy. But if we apply the same principles, then enterprise software stocks leveraging their own generative AI capabilities may well be the Gorillas of the future. So, in that spirit, we are excited to present our Special Free Report on a profitable, fast-growing enterprise software stock that is already riding the automation wave and looking to catch the generative AI next.