We expect battery and personal care products manufacturer,
Energizer Holdings Inc.
) to beat expectations when it reports third quarter 2014 results
on Jul 30.
Why a Likely Positive Surprise?
Our proven model shows that Energizer is likely to beat earnings
because it has the right combination of two key ingredients.
Positive Zacks ESP
, which represents the difference between the Most Accurate
estimate and the Zacks Consensus Estimate, is at +1.29%. This is
very meaningful and a leading indicator of a likely positive
earnings surprise for shares.
Zacks Rank #3 (Hold)
: Note that stocks with Zacks Ranks of #1, #2 and #3 have a
significantly higher chance of beating earnings. The sell rated
stocks (#4 and #5) should never be considered going into an
The combination of Energizer's Zacks Rank #3 and +1.29% ESP makes
us very confident in looking for a positive earnings beat on Jul
What is Driving the Better-Than-Expected Earnings?
We believe that product innovations coupled with higher pricing of
Energizer's household products and restructuring initiatives would
positively impact its results, going forward.
Moreover, its prudent product mix would expand margins in the near
term. Also, the company's partnership with Unilever's AXE brand is
expected to result in market share gains, going forward. This
apart, the acquisition strategy of the company is expected to reap
However, the expected decline in volumes in the Household Product
segment, unfavorable foreign exchange and increasing competition
from companies such as Kimberley-Clark Corp. and Procter &
Gamble Co. are the near-term headwinds.
Other Stocks to Consider
Energizer is not the only firm looking up this earnings season. We
also see likely earnings beats coming from these 3 companies:
Synaptics Inc (
), Earnings ESP of +4.07% and Zacks Rank #1 (Strong Buy).
Western Digital Corporation (
), Earnings ESP of +4.02% and Zacks Rank #2 (Buy).
Iron Mountain Inc. (
), Earnings ESP of +12.82% and Zacks Rank #2 (Buy).
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