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READING, Pa. - EnerSys (NYSE: NYSE:ENS), a global provider of stored energy solutions for industrial applications, has announced a 7% increase in its quarterly cash dividend to $0.24 per share, scheduled to be paid on September 30, 2024. This decision was made by the company's Board of Directors and affects shareholders of record as of September 16, 2024.
President and CEO David M. Shaffer commented on the company's financial health, stating that strong earnings growth and solid cash flow have positioned EnerSys to continue investing in growth while also returning capital to shareholders. He emphasized the company's commitment to a competitive dividend and the intention to raise it in line with earnings growth, independent of benefits from the Investment Tax Credit (ITC).
EnerSys operates through four business segments: Energy Systems, Motive Power, Specialty, and New Ventures. The company serves a diverse range of industries, including telecommunications, utilities, and aerospace, and offers products such as power batteries, chargers, and energy storage solutions. EnerSys maintains a global presence, serving customers in over 100 countries with sales and manufacturing locations worldwide.
The company also underscored its commitment to sustainability, which is integral to its operational management and product impact. EnerSys aims to minimize its environmental footprint while ensuring positive environmental, social, and economic outcomes through its products and practices.
This dividend increase announcement is based on a press release statement from EnerSys, and it is a reflection of the company's current financial strategy and outlook.
In other recent news, EnerSys reported strong financial results, meeting its revenue target of $911 million and exceeding earnings expectations with $2.08 per share for the fourth quarter of fiscal 2024. The company also reported the acquisition of Bren-Tronics, a strategic move aimed at enhancing its defense applications and lithium product offerings. EnerSys' shareholders made several key decisions at the Annual Meeting, including electing David C. Habiger, Lauren Knausenberger, and Tamara Morytko to the company's Board, and ratifying Ernst & Young LLP as the independent registered public accounting firm for fiscal year 2025.
The company has made significant strides in its sustainability efforts, notably in reducing emissions. For the first quarter and full fiscal year 2025, EnerSys expects net sales between $860 million and $900 million, and between $3.675 billion and $3.825 billion respectively. The projected adjusted diluted earnings per share (EPS) range from $1.93 to $2.03 for Q1, and $8.55 to $8.95 for the full fiscal year.
Despite facing supply chain constraints and a decrease in Q4 net sales compared to the previous year, EnerSys remains confident in its strategic plan and its ability to deliver long-term shareholder value. The company is also optimistic about the growth of renewable energy and energy storage solutions. EnerSys' strategic plan is on track, with adjusted EPS above initial projections.
InvestingPro Insights
In light of EnerSys's recent announcement of a dividend increase, a closer look at the company's financial metrics and analyst outlooks from InvestingPro offers additional insights into its performance and potential. The company's market capitalization stands at $3.81 billion, reflecting its substantial presence in the industrial energy solutions sector. Notably, EnerSys is trading at a price-to-earnings (P/E) ratio of 14.43, which is considered low relative to its near-term earnings growth. This could indicate that the stock is undervalued, especially considering that analysts have revised their earnings upwards for the upcoming period.
InvestingPro Tips highlight that EnerSys has maintained dividend payments for 12 consecutive years, which aligns with CEO David M. Shaffer's statement regarding the company's commitment to competitive dividends. Moreover, the company's liquid assets exceed its short-term obligations, suggesting a strong liquidity position that can support both operational needs and shareholder returns. With the company being profitable over the last twelve months and analysts predicting profitability for this year, the dividend increase appears to be supported by a solid financial foundation.
Despite a recent decline in stock price, with a one-week total return of -12.84%, the long-term commitment to dividends and the company's overall financial health may offer reassurance to investors. For those seeking more comprehensive analysis and additional InvestingPro Tips, there are 8 more tips available at InvestingPro's dedicated section for EnerSys (https://www.investing.com/pro/ENS).
Overall, these metrics and insights from InvestingPro suggest that EnerSys is positioned to continue its growth trajectory while rewarding shareholders, even as it navigates market fluctuations and invests in sustainable practices.
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