AZZ Inc. (NYSE:AZZ) Just Reported And Analysts Have Been Lifting Their Price Targets

Investors in AZZ Inc. (NYSE:AZZ) had a good week, as its shares rose 9.7% to close at US$82.93 following the release of its yearly results. Results were roughly in line with estimates, with revenues of US$1.5b and statutory earnings per share of US$3.46. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

Check out our latest analysis for AZZ

Taking into account the latest results, the consensus forecast from AZZ's four analysts is for revenues of US$1.58b in 2025. This reflects a satisfactory 2.9% improvement in revenue compared to the last 12 months. Per-share earnings are expected to climb 16% to US$4.01. Before this earnings report, the analysts had been forecasting revenues of US$1.58b and earnings per share (EPS) of US$3.88 in 2025. So the consensus seems to have become somewhat more optimistic on AZZ's earnings potential following these results.

The consensus price target rose 8.5% to US$84.67, suggesting that higher earnings estimates flow through to the stock's valuation as well. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. There are some variant perceptions on AZZ, with the most bullish analyst valuing it at US$89.00 and the most bearish at US$80.00 per share. The narrow spread of estimates could suggest that the business' future is relatively easy to value, or thatthe analysts have a strong view on its prospects.

Of course, another way to look at these forecasts is to place them into context against the industry itself. It's pretty clear that there is an expectation that AZZ's revenue growth will slow down substantially, with revenues to the end of 2025 expected to display 2.9% growth on an annualised basis. This is compared to a historical growth rate of 10% over the past five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 5.4% per year. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than AZZ.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards AZZ following these results. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that AZZ's revenue is expected to perform worse than the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple AZZ analysts - going out to 2026, and you can see them free on our platform here.

Even so, be aware that AZZ is showing 1 warning sign in our investment analysis , you should know about...

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.