Hurricane Fears Power Energizer Shares

Energizer may be one of the biggest players in the US sun care category, but it gets the bulk of its sales from batteries, which were in big demand on the East Coast this weekend. In fact, shares of Energizer Holdings Inc. rose in trading Friday as the battery maker expected to see a sales boost from shoppers stocking up on supplies for Hurricane Irene.

Hurricane Irene has residents along the East Coast preparing for possible disaster and storms, which includes snapping up batteries to power radios, flashlights and other equipment in case of power outages. Energizer makes an array of batteries, flashlights and other related products. The company holds a roughly 38% market share of the total battery business in the U.S., according to Citi Investment Research analyst Wendy Nicholson. She estimates batteries represent roughly 25% of the St. Louis company’s total sales.

Hurricanes that come on shore and quickly dissipate, as often seen from those in the Gulf of Mexico, have a minimal impact on battery category sales. A hurricane that travels up the Eastern Seaboard creates a bigger group of people preparing for or potentially actually affected by a hurricane. Nicholson said that with Irene, given the heavy population density of the Northeastern U.S., she suspects the boost to category sales could be meaningful. However, if power outages are limited in scope, pantries would still be stocked, potentially putting pressure on sales the next quarter.