Bloomberg the Company & Products

Bloomberg Anywhere Login

Bloomberg

Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world.

Company

Financial Products

Enterprise Products

Media

Customer Support

  • Americas

    +1 212 318 2000

  • Europe, Middle East, & Africa

    +44 20 7330 7500

  • Asia Pacific

    +65 6212 1000

Communications

Industry Products

Media Services

Follow Us

Businessweek Archives

A Battery Maker Runs Low


Inside Wall Street

A BATTERY MAKER RUNS LOW

It looks like Exide (EX), a major producer of automotive and industrial batteries, may need a power battery of its own. The stock has plunged more than 50% from its 1995 high. The stock, at 20 on Jan. 29, "could still plunge to as low as 12," warns an investment manager in Mills Valley, Calif. What's wrong? Analyst Darren Kimball of Salomon Brothers warns that the "profit shortfall from the weakness in Exide's North American battery business will be more pronounced than previously thought." So he has reduced his earnings estimates accordingly.

Kimball also says that earnings could fall below his already reduced estimates. He has cut his estimate for the year ending Mar. 31, 1997, from $1.40 a share to $1.10, and from $2 to $1.70 for fiscal 1998.

He notes that Exide, which markets its products to merchandisers, auto supply chains, and wholesale distributors, will lose one big customer--Montgomery Ward, a major domestic battery retailer, in April.

Alan Gauthier, Exide's chief financial officer, says Kimball is "all wrong." He insists that Exide is "doing well in total," contrary to the claims of the bears. He adds that shipments to Montgomery Ward aren't very significant to overall sales. And Gauthier is confident that Exide's contract with Sears Roebuck, which expires in September, will be renewed.BY GENE G. MARCIAL


LIMITED-TIME OFFER SUBSCRIBE NOW
 
blog comments powered by Disqus