Energizer Holdings
Energizer Holdings (ENR): owns two of the world’s great brands: Energizer and Schick. About 70% of the company’s sales come from the battery business and 30% come from the razor and blades business. International sales (from both businesses) account for almost exactly half of all sales. Batteries and razors are both high free cash flow margin businesses.
In 2003, the company bought Schick – Wilkinson Sword from Pfizer (PFE) for just under $1 billion. In 2005, Schick contributed just under $120 million in profit.
On February 1st, 2006, I estimated Energizer Holdings was worth $7.5 billion. Currently, the stock trades at rather low price – to – earnings, price – to – cash flow, and price – to – sales multiples. However, Energizer carries a large amount of debt relative to its equity; so, you may want to value the company using metrics like Enterprise Value / Sales, Enterprise Value / EBITDA, and Enterprise Value / EBIT instead.
Here are the three best pieces on the company from The Motley Fool:
January 24, 2006: “A Catalyst for Energizer”
November 29, 2005: “Energizer Partially Recharged”
February 16, 2005: “Energizer’s Still Juiced”
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