DB:AQ8

Stock Analysis Report

Executive Summary

Acuity Brands, Inc. provides lighting and building management solutions and services for commercial, institutional, industrial, infrastructure, and residential applications in North America and internationally.

Rewards

Trading at 23.6% below its fair value

Earnings are forecast to grow 6.61% per year

Risk Analysis

No risks detected for AQ8 from our risk checks.


Snowflake Analysis

Flawless balance sheet and good value.


Similar Companies

Share Price & News

How has Acuity Brands's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: AQ8 has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-0.8%

AQ8

1.0%

DE Electrical

1.0%

DE Market


1 Year Return

17.3%

AQ8

55.8%

DE Electrical

15.7%

DE Market

Return vs Industry: AQ8 underperformed the German Electrical industry which returned 55.8% over the past year.

Return vs Market: AQ8 exceeded the German Market which returned 15.7% over the past year.


Shareholder returns

AQ8IndustryMarket
7 Day-0.8%1.0%1.0%
30 Day3.5%5.8%0.9%
90 Day-4.5%20.6%7.2%
1 Year17.8%17.3%58.2%55.8%19.3%15.7%
3 Year-48.5%-49.0%-7.1%-10.7%19.5%8.9%
5 Year8.0%6.3%12.4%3.7%36.9%18.3%

Price Volatility Vs. Market

How volatile is Acuity Brands's share price compared to the market and industry in the last 5 years?


Simply Wall St News

No news available

Valuation

Is Acuity Brands undervalued compared to its fair value and its price relative to the market?

23.6%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: AQ8 (€119) is trading below our estimate of fair value (€155.72)

Significantly Below Fair Value: AQ8 is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: AQ8 is good value based on its PE Ratio (15.7x) compared to the Electrical industry average (20.2x).

PE vs Market: AQ8 is good value based on its PE Ratio (15.7x) compared to the German market (20.5x).


Price to Earnings Growth Ratio

PEG Ratio: AQ8 is poor value based on its PEG Ratio (2.4x)


Price to Book Ratio

PB vs Industry: AQ8 is overvalued based on its PB Ratio (2.7x) compared to the DE Electrical industry average (2.1x).


Next Steps

Future Growth

How is Acuity Brands forecast to perform in the next 1 to 3 years based on estimates from 9 analysts?

6.6%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: AQ8's forecast earnings growth (6.6% per year) is above the savings rate (-0.4%).

Earnings vs Market: AQ8's earnings (6.6% per year) are forecast to grow slower than the German market (13.3% per year).

High Growth Earnings: AQ8's earnings are forecast to grow, but not significantly.

Revenue vs Market: AQ8's revenue (2% per year) is forecast to grow slower than the German market (4.9% per year).

High Growth Revenue: AQ8's revenue (2% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: AQ8's Return on Equity is forecast to be low in 3 years time (17.8%).


Next Steps

Past Performance

How has Acuity Brands performed over the past 5 years?

12.5%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: AQ8 has high quality earnings.

Growing Profit Margin: AQ8's current net profit margins (9%) are lower than last year (9.5%).


Past Earnings Growth Analysis

Earnings Trend: AQ8's earnings have grown by 12.5% per year over the past 5 years.

Accelerating Growth: AQ8's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: AQ8 had negative earnings growth (-5.5%) over the past year, making it difficult to compare to the Electrical industry average (17.2%).


Return on Equity

High ROE: AQ8's Return on Equity (17.2%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Acuity Brands's financial position?


Financial Position Analysis

Short Term Liabilities: AQ8's short term assets ($1.4B) exceed its short term liabilities ($596.1M).

Long Term Liabilities: AQ8's short term assets ($1.4B) exceed its long term liabilities ($657.4M).


Debt to Equity History and Analysis

Debt Level: AQ8's debt to equity ratio (18.6%) is considered satisfactory.

Reducing Debt: AQ8's debt to equity ratio has reduced from 30.2% to 18.6% over the past 5 years.

Debt Coverage: AQ8's debt is well covered by operating cash flow (138.7%).

Interest Coverage: AQ8's interest payments on its debt are well covered by EBIT (13.9x coverage).


Balance Sheet

Inventory Level: AQ8 has a low level of unsold assets or inventory.

Debt Coverage by Assets: AQ8's debt is covered by short term assets (assets are 4x debt).


Next Steps

Dividend

What is Acuity Brands's current dividend yield, its reliability and sustainability?

0.40%

Current Dividend Yield


Dividend Yield vs Market

company0.4%marketbottom25%1.3%markettop25%3.6%industryaverage2.3%forecastin3Years0.4%

Current dividend yield vs market & industry

Notable Dividend: AQ8's dividend (0.4%) isn’t notable compared to the bottom 25% of dividend payers in the German market (1.33%).

High Dividend: AQ8's dividend (0.4%) is low compared to the top 25% of dividend payers in the German market (3.55%).


Stability and Growth of Payments

Stable Dividend: AQ8 is not paying a notable dividend for the German market, therefore no need to check if payments are stable.

Growing Dividend: AQ8 is not paying a notable dividend for the German market, therefore no need to check if payments are increasing.


Current Payout to Shareholders

Dividend Coverage: AQ8 is not paying a notable dividend for the German market.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of AQ8's dividend in 3 years as they are not forecast to pay a notable one for the German market.


Next Steps

Management

What is the CEO of Acuity Brands's salary, the management and board of directors tenure and is there insider trading?

2.1yrs

Average management tenure


CEO

Vernon Nagel (62yo)

15.3yrs

Tenure

US$14,874,164

Compensation

Mr. Vernon J. Nagel has been the Chairman of the Board and Chief Executive Officer of Acuity Brands, Inc. since September 1, 2004 and was its President since August 2, 2005 until August 2019. Mr. Nagel ser ...


CEO Compensation Analysis

Compensation vs Market: Vernon's total compensation ($USD14.87M) is above average for companies of similar size in the German market ($USD3.80M).

Compensation vs Earnings: Vernon's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.


Management Age and Tenure

2.1yrs

Average Tenure

59yo

Average Age

Experienced Management: AQ8's management team is considered experienced (2.1 years average tenure).


Board Age and Tenure

7.3yrs

Average Tenure

69.5yo

Average Age

Experienced Board: AQ8's board of directors are considered experienced (7.3 years average tenure).


Insider Trading

Insider Buying: AQ8 insiders have only sold shares in the past 3 months.


Recent Insider Transactions

Sell€11,88407 Nov 19
Robert McCullough
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares100
Max Price€118.84
Sell€274,42210 Jul 19
Ray Robinson
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares2,363
Max Price€116.13

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Management Team

  • Ricky Reece (63yo)

    President

    • Tenure: 0.3yrs
    • Compensation: US$7.10m
  • Vernon Nagel (62yo)

    Chairman & CEO

    • Tenure: 15.3yrs
    • Compensation: US$14.87m
  • C. Smith (54yo)

    Senior VP

    • Tenure: 9.9yrs
    • Compensation: US$577.32k
  • Barry Goldman

    Senior VP & General Counsel of Acuity Brands Lighting

    • Tenure: 0yrs
  • Karen Holcom (50yo)

    Senior VP & CFO

    • Tenure: 0.3yrs
  • Laurent Vernerey (59yo)

    Strategic Business Development Executive

    • Tenure: 2.1yrs
    • Compensation: US$2.80m

Board Members

  • Jim Hance (75yo)

    Independent Director

    • Tenure: 5.3yrs
    • Compensation: US$277.05k
  • Dominic Pileggi (68yo)

    Independent Director

    • Tenure: 7.3yrs
    • Compensation: US$297.05k
  • Robert McCullough (77yo)

    Independent Director

    • Tenure: 16.8yrs
    • Compensation: US$277.05k
  • Peter Browning (78yo)

    Lead Independent Director

    • Tenure: 0yrs
    • Compensation: US$302.05k
  • Ray Robinson (71yo)

    Independent Director

    • Tenure: 18yrs
    • Compensation: US$290.05k
  • Judi North (72yo)

    Independent Director

    • Tenure: 17.5yrs
    • Compensation: US$277.05k
  • Vernon Nagel (62yo)

    Chairman & CEO

    • Tenure: 15.3yrs
    • Compensation: US$14.87m
  • Mary Winston (57yo)

    Independent Director

    • Tenure: 2.8yrs
    • Compensation: US$277.05k
  • Doug Dillard (48yo)

    Independent Director

    • Tenure: 2.3yrs
    • Compensation: US$277.05k
  • W. Battle (56yo)

    Independent Director

    • Tenure: 5.3yrs
    • Compensation: US$275.05k

Company Information

Acuity Brands, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Acuity Brands, Inc.
  • Ticker: AQ8
  • Exchange: DB
  • Founded: 2001
  • Industry: Electrical Components and Equipment
  • Sector: Capital Goods
  • Market Cap: US$5.130b
  • Listing Market Cap: US$4.612b
  • Shares outstanding: 39.22m
  • Website: https://www.acuitybrands.com

Number of Employees


Location

  • Acuity Brands, Inc.
  • 1170 Peachtree Street, N.E.
  • Suite 2300
  • Atlanta
  • Georgia
  • 30309
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
AYINYSE (New York Stock Exchange)YesCommon StockUSUSDNov 2001
AQ8DB (Deutsche Boerse AG)YesCommon StockDEEURNov 2001
0H90LSE (London Stock Exchange)YesCommon StockGBUSDNov 2001

Biography

Acuity Brands, Inc. provides lighting and building management solutions and services for commercial, institutional, industrial, infrastructure, and residential applications in North America and internation ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/12/15 21:23
End of Day Share Price2019/12/13 00:00
Earnings2019/08/31
Annual Earnings2019/08/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.