雅虎香港財經 Here's Why You Should Hold EnerSys (ENS) in Your Portfolio
EnerSys ENS has been witnessing solid momentum in its Specialty segment, supported by strong orders in transportation, aerospace and defense markets in the United States and Europe. The segment’s revenues increased 6.8% year over year in the third quarter of fiscal 2024 (ended December 2023). Strength in automation and electrification markets has been driving the performance of the Motive Power segment. The global megatrends, including 5G expansion, rural broadband build-outs, electrification, automation and decarbonization, are expected to support the company’s growth in the quarters ahead.
EnerSys believes in adding complementary businesses to its portfolio via acquisitions. In April 2023, it acquired UK-based battery service and maintenance provider, Industrial Battery and Charger Services Limited (IBCS). The inclusion of IBCS strengthened its foothold in the U.K. market. It also augmented ENS’ comprehensive range of battery-related services, including installation and maintenance, and repair and replacement.
ENS remains committed to rewarding its shareholders through dividend payouts and share buybacks. For instance, it paid out dividends of $25.4 million and repurchased shares worth $82.3 million in the first nine months of fiscal 2024. Its quarterly dividend rate was hiked by 29% in August 2023.
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Over the past year, this Zacks Rank #3 (Hold) company has gained 12.7% compared with the industry’s growth of 62.7%.
However, EnerSys’ Energy Systems segment has been grappling with a decline in capital spending of the telecommunication and broadband customers. The segment’s revenues decreased 14% year over year in the third quarter of fiscal 2024. Lower demand in the network communications, and telecom and broadband markets remains concerning for the company.
High capital expenditures might also hurt the company’s bottom line in the near-term. The company's capital expenditure totaled $59 million in the first nine months of fiscal 2024. For fiscal 2024 (ended March 2024), it expects capital expenditure in the range of $80-$100 million.
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Eaton Corporation, PLC (ETN) : Free Stock Analysis Report
Enersys (ENS) : Free Stock Analysis Report
Powell Industries, Inc. (POWL) : Free Stock Analysis Report
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