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The Energizer Opportunity Revisited

Aug. 28, 2016 9:32 AM ETEnergizer Holdings, Inc. (ENR)
Robert Altabet profile picture
Robert Altabet


  • Share gains from increased focus at Energizer.
  • Share losses at Duracell.
  • The gap between Energizer and Duracell has closed from 17.2 share points in January to 12.8 share points in August.
  • Some Duracell exclusive accounts are vulnerable to Energizer inroads.

The Energizer Opportunity Revisited


Energizer (NYSE: NYSE:ENR) was spun off as an independent battery company on July 1, 2015, a little over a year ago, which had been first announced 15 months earlier back in April 2014. Since those announcements, we have been looking for the benefits that increased focus as a stand-alone battery company could bring to their competitive position. Those expectations were complicated when P&G (NYSE: PG) announced the spin-off of Duracell in October 2014 which could have made a Duracell a stand-alone battery company with the same benefit of focus. That changed when P&G agreed to sell Duracell to Berkshire Hathaway (NYSE: BRK.A, BRK.B) in November 2014. After some delays that deal closed at the end of February 2016.

Energizer is clearly operating as an independent company, although the Handstands acquisition was of concern. With Duracell buried inside Berkshire Hathaway, it is difficult to see how independent they will be, but early indications are that they will have a fair degree of autonomy. However, they are still distracted by the needs for re-structuring the company to function independently both for all the backroom functions and the need for an independent sales force.

The Energizer - Duracell Share Interactions

The interesting story is the tradeoff between Energizer and Duracell in shares since the beginning of the year. Within Nielsen outlets the shift in the gap between Energizer and Duracell has moved almost 4½ share points in Energizer's favor, from 17.2 for the 4 weeks ending 1/23/16, to 12.8 for the latest 4 weeks ending 8/13/16. We might have expected to see this sort of movement begin by late last year with that focus from Energizer as an independent company (and the 15 months prior to get ready for it). However, it is gratifying to see the impacts - and a testament to the longer planning lead

This article was written by

Robert Altabet profile picture
Since 2002, I have been the owner of a consulting business, Alpha Beta Planning, that specializes in the areas of business development and planning as well as sales and market forecasting. I also provide marketing and forecasting due diligence for investors in the private capital markets. I am an  Advisory Board Member for BWG Strategy, consulting on battery related companies. I am a former Vice-President, Business Management at Duracell Batteries where I spent 28 years with experience that included extensive work in new product development and licensing, marketing management, market research and sales forecasting as well stints in manufacturing and financial planning.

Analyst’s Disclosure: I am/we are long ENR. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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