Energizer Holdings Inc. (ENR Quick QuoteENR - Free Report) has been benefiting from its Project Momentum program, which includes an enterprise-wide restructuring component. Under Project Momentum, the company implemented several initiatives to recover operating margins, cash flow and organizational efficiency. It remains focused on delivering savings through network optimization, strategic sourcing initiatives and cost savings.

The Project Momentum program enabled the company to generate savings of $32 million in the first three quarters of fiscal 2023. ENR has added a third year to the program, which is expected to produce $130-$150 million in run-rate savings by the end of fiscal 2025, with nearly 80% of such benefits aiding the gross margin.

For fourth-quarter fiscal 2023, Energizer anticipates organic revenues to be roughly flat with a strong improvement in gross margin. It expects to achieve a gross margin of about 40% in the fourth quarter, indicating a year-over-year improvement of 200 basis points. The gross margin improvement is likely to be driven by input cost tailwinds and incremental Project Momentum savings. For the quarter, it anticipates adjusted earnings per share of $1.10-$1.20, higher than 82 cents per share earned in the prior fiscal year quarter.

ENR is also committed to rewarding shareholders through dividend payouts. For the first nine months of fiscal 2023, the company returned $64.8 million to shareholders through dividends, of which $22 million was paid in the fiscal third quarter.

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The Zacks Rank #3 (Hold) company’s shares have gained 1.3% in the year-to-date period against the industry’s decline of 15.2%.

Despite the positives, the company has been witnessing softness in its battery and auto care businesses and a decline in sales to device manufacturers. For instance, Energizer’s Batteries & Lights segment’s revenues fell 3.8% year over year to $511.3 million in the fiscal third quarter. For fiscal 2023, management expects low single-digit declines in its organic revenues.

Given Energizer’s extensive presence across international markets, its business is subject to foreign exchange headwinds. Currency headwinds had an adverse impact of $48 million on its net sales in the first three quarters of fiscal 2023. In addition, although inflationary pressure has somewhat eased, rising interest rates remain a concern for the company.

3 Promising Staple Stocks

Here we have highlighted three top-ranked stocks, namely J&J Snack Foods Corporation (JJSF Quick QuoteJJSF - Free Report) , MGP Ingredients, Inc. (MGPI Quick QuoteMGPI - Free Report) and Post Holdings (POST Quick QuotePOST - Free Report) , each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

J&J Snack Foods is an American manufacturer, marketer and distributor of branded niche snack foods and frozen beverages for the food service and retail supermarket industries. JJSF has a trailing four-quarter earnings surprise of 4.7%, on average. The Zacks Consensus Estimate for J&J Snack Foods’ current fiscal-year sales and earnings suggests growth of 11.1% and 62.3%, respectively, from the year-ago reported figures.

MGP Ingredients produces and markets ingredients and distillery products for the packaged goods industry. MGPI has a trailing four-quarter earnings surprise of 18%, on average. The Zacks Consensus Estimate for MGP Ingredients’ current financial-year sales and earnings suggests growth of 5.8% and 10.4%, respectively, from the year-ago reported numbers.

Post Holdings is a consumer-packaged goods holding company. POST has a trailing four-quarter earnings surprise of 59.6%, on average. The Zacks Consensus Estimate for Post Holdings’ current financial-year sales and earnings suggests growth of 13.5% and 184.5%, respectively, from the year-ago reported numbers.