AZZ INC (AZZ)
US0024741045 - Common Stock
Taking everything into account, AZZ scores 3 out of 10 in our fundamental rating. AZZ was compared to 43 industry peers in the Building Products industry. Both the profitability and financial health of AZZ have multiple concerns. AZZ is quite expensive at the moment. It does show a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year AZZ was profitable.
In the past year AZZ had a positive cash flow from operations.
The reported net income has been mixed in the past 5 years: AZZ reported negative net income in multiple years.
AZZ had a positive operating cash flow in 4 of the past 5 years.
1.2 Ratios
AZZ's Return On Assets of 3.19% is on the low side compared to the rest of the industry. AZZ is outperformed by 69.77% of its industry peers.
With a Return On Equity value of 7.64%, AZZ is not doing good in the industry: 65.12% of the companies in the same industry are doing better.
AZZ's Return On Invested Capital of 8.03% is in line compared to the rest of the industry. AZZ outperforms 41.86% of its industry peers.
The Average Return On Invested Capital over the past 3 years for AZZ is below the industry average of 13.67%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.19% | ||
| ROE | 7.64% | ||
| ROIC | 8.03% |
ROA(3y)-1.39%
ROA(5y)1%
ROE(3y)-3.33%
ROE(5y)1.22%
ROIC(3y)9.34%
ROIC(5y)8.7%
1.3 Margins
The Profit Margin of AZZ (4.67%) is worse than 67.44% of its industry peers.
AZZ has a Operating Margin of 14.30%. This is comparable to the rest of the industry: AZZ outperforms 55.81% of its industry peers.
AZZ's Operating Margin has improved in the last couple of years.
AZZ has a worse Gross Margin (22.80%) than 69.77% of its industry peers.
In the last couple of years the Gross Margin of AZZ has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 14.3% | ||
| PM (TTM) | 4.67% | ||
| GM | 22.8% |
OM growth 3Y15.25%
OM growth 5Y18.87%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y0.02%
GM growth 5Y2.48%
2. Health
2.1 Basic Checks
AZZ has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
AZZ has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
2.2 Solvency
An Altman-Z score of 2.51 indicates that AZZ is not a great score, but indicates only limited risk for bankruptcy at the moment.
With a Altman-Z score value of 2.51, AZZ is not doing good in the industry: 69.77% of the companies in the same industry are doing better.
The Debt to FCF ratio of AZZ is 11.47, which is on the high side as it means it would take AZZ, 11.47 years of fcf income to pay off all of its debts.
With a Debt to FCF ratio value of 11.47, AZZ is not doing good in the industry: 83.72% of the companies in the same industry are doing better.
A Debt/Equity ratio of 1.07 is on the high side and indicates that AZZ has dependencies on debt financing.
With a Debt to Equity ratio value of 1.07, AZZ is not doing good in the industry: 72.09% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.07 | ||
| Debt/FCF | 11.47 | ||
| Altman-Z | 2.51 |
ROIC/WACC0.67
WACC12.04%
2.3 Liquidity
AZZ has a Current Ratio of 1.96. This is a normal value and indicates that AZZ is financially healthy and should not expect problems in meeting its short term obligations.
The Current ratio of AZZ (1.96) is comparable to the rest of the industry.
A Quick Ratio of 1.33 indicates that AZZ should not have too much problems paying its short term obligations.
The Quick ratio of AZZ (1.33) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.96 | ||
| Quick Ratio | 1.33 |
3. Growth
3.1 Past
The earnings per share for AZZ have decreased strongly by -11.16% in the last year.
Measured over the past years, AZZ shows a quite strong growth in Earnings Per Share. The EPS has been growing by 12.12% on average per year.
The Revenue for AZZ has decreased by -21.28% in the past year. This is quite bad
The Revenue has been growing by 10.31% on average over the past years. This is quite good.
EPS 1Y (TTM)-11.16%
EPS 3Y12.12%
EPS 5YN/A
EPS growth Q2Q35.23%
Revenue 1Y (TTM)-21.28%
Revenue growth 3Y7.62%
Revenue growth 5Y10.31%
Revenue growth Q2Q2.22%
3.2 Future
The Earnings Per Share is expected to grow by 13.09% on average over the next years. This is quite good.
Based on estimates for the next years, AZZ will show a quite strong growth in Revenue. The Revenue will grow by 9.41% on average per year.
EPS Next Y13.53%
EPS Next 2Y11.36%
EPS Next 3Y13.09%
EPS Next 5YN/A
Revenue Next Year17.32%
Revenue Next 2Y9.89%
Revenue Next 3Y9.41%
Revenue Next 5YN/A
3.3 Evolution
The EPS growth rate is stable: in the next years the growth will be about the same than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 19.24, AZZ is valued on the expensive side.
AZZ's Price/Earnings is on the same level as the industry average.
AZZ is valuated rather cheaply when we compare the Price/Earnings ratio to 28.28, which is the current average of the S&P500 Index.
A Price/Forward Earnings ratio of 15.84 indicates a correct valuation of AZZ.
Compared to the rest of the industry, the Price/Forward Earnings ratio of AZZ is on the same level as its industry peers.
Compared to an average S&P500 Price/Forward Earnings ratio of 20.88, AZZ is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.24 | ||
| Fwd PE | 15.84 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of AZZ indicates a somewhat cheap valuation: AZZ is cheaper than 65.12% of the companies listed in the same industry.
AZZ's Price/Free Cash Flow ratio is a bit more expensive when compared to the industry. AZZ is more expensive than 65.12% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 26.02 | ||
| EV/EBITDA | 10.92 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
AZZ's earnings are expected to grow with 13.09% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.42
PEG (5Y)N/A
EPS Next 2Y11.36%
EPS Next 3Y13.09%
5. Dividend
5.1 Amount
With a yearly dividend of 0.92%, AZZ is not a good candidate for dividend investing.
AZZ's Dividend Yield is a higher than the industry average which is at 1.20.
Compared to an average S&P500 Dividend Yield of 2.41, AZZ's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.92% |
5.2 History
The dividend of AZZ is nicely growing with an annual growth rate of 6.10%!
AZZ has been paying a dividend for at least 10 years, so it has a reliable track record.
AZZ has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)6.1%
Div Incr Years0
Div Non Decr Years13
5.3 Sustainability
47.66% of the earnings are spent on dividend by AZZ. This is a bit on the high side, but may be sustainable.
The dividend of AZZ is growing, but earnings are growing more, so the dividend growth is sustainable.
DP47.66%
EPS Next 2Y11.36%
EPS Next 3Y13.09%
AZZ INC
NYSE:AZZ (5/3/2024, 7:04:00 PM)
After market: 75.02 0 (0%)75.02
+0.8 (+1.08%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryBuilding Products
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap2.23B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.92% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
Max EPS beat(2)
EPS beat(4)
Avg EPS beat(4)
Min EPS beat(4)
Max EPS beat(4)
EPS beat(8)
Avg EPS beat(8)
EPS beat(12)
Avg EPS beat(12)
EPS beat(16)
Avg EPS beat(16)
Revenue beat(2)
Avg Revenue beat(2)
Min Revenue beat(2)
Max Revenue beat(2)
Revenue beat(4)
Avg Revenue beat(4)
Min Revenue beat(4)
Max Revenue beat(4)
Revenue beat(8)
Avg Revenue beat(8)
Revenue beat(12)
Avg Revenue beat(12)
Revenue beat(16)
Avg Revenue beat(16)
PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.24 | ||
| Fwd PE | 15.84 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)1.42
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.19% | ||
| ROE | 7.64% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 14.3% | ||
| PM (TTM) | 4.67% | ||
| GM | 22.8% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.68
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.07 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 1.96 | ||
| Quick Ratio | 1.33 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)-11.16%
EPS 3Y12.12%
EPS 5Y
EPS growth Q2Q
EPS Next Y13.53%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)-21.28%
Revenue growth 3Y7.62%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y