NYSE:AZZ

Stock Analysis Report

Executive Summary

AZZ Inc. provides galvanizing and metal coating services, welding solutions, specialty electrical equipment, and highly engineered services to the power generation, transmission, distribution, refining, and industrial markets.

Snowflake

Fundamentals

Excellent balance sheet established dividend payer.


Similar Companies

Share Price & News

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


Latest Share Price and Events


Market Performance


7 Day Return

-9.6%

AZZ

3.0%

US Electrical

1.0%

US Market


1 Year Return

-16.0%

AZZ

-0.05%

US Electrical

6.7%

US Market

Return vs Industry: AZZ underperformed the US Electrical industry which returned -0% over the past year.

Return vs Market: AZZ underperformed the US Market which returned 6.7% over the past year.


Share holder returns

AZZIndustryMarket
7 Day-9.6%3.0%1.0%
30 Day-12.1%-3.4%-1.8%
90 Day-16.0%-1.1%-1.8%
1 Year-15.0%-16.0%2.1%-0.05%9.1%6.7%
3 Year-25.1%-27.9%39.5%31.4%46.1%36.6%
5 Year-3.5%-9.3%36.5%22.9%66.9%48.6%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is AZZ undervalued based on future cash flows and its price relative to the stock market?

27%

Discount to future cash flow value


Intrinsic Value Based on Future Cash Flows

Undervalued: AZZ ($38.9) is trading below our estimate of fair value ($52.97)

Significantly Undervalued: AZZ is trading below fair value, but not by a significant amount.


Price Based on Earnings

PE vs Industry: AZZ is poor value based on its PE Ratio (17.9x) compared to the Electrical industry average (15.3x).

PE vs Market: AZZ is poor value based on its PE Ratio (17.9x) compared to the US market (17.5x).


Price Based on Expected Growth

Low PEG Ratio: AZZ is poor value based on its PEG Ratio (1.2x)


Price Based on Value of Assets

PB vs Industry: AZZ is overvalued based on its PB Ratio (1.6x) compared to the US Electrical industry average (1.5x).


Next Steps

Future Growth

How is AZZ expected to perform in the next 1 to 3 years based on estimates from 3 analysts?

15.5%

Forecasted annual earnings growth


Earnings and Revenue Growth Estimates


Future Annual Growth Analysis

Earnings vs Savings Rate: AZZ's forecast earnings growth (15.5% per year) is above the savings rate (2.7%).

Earnings vs Market: AZZ's earnings (15.5% per year) are forecast to grow faster than the US market (14.5% per year).

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

Revenue vs Market: AZZ's revenue (3.5% per year) is forecast to grow slower than the US market (7.3% per year).

High Growth Revenue: AZZ's revenue (3.5% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Estimates


Future Return on Equity

High Future ROE: AZZ's Return on Equity is forecast to be low in 3 years time (14.5%).


Next Steps

Past Performance

How has AZZ performed over the past 5 years?

-6.2%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: AZZ's earnings have declined by -6.2% per year over the past 5 years.

Accelerating Growth: AZZ's earnings growth over the past year (16.3%) exceeds its 5-year average (-6.2% per year).

Earnings vs Industry: AZZ earnings growth over the past year (16.3%) underperformed the Electrical industry 24%.


Return on Equity

High ROE: AZZ's Return on Equity (9.2%) is considered low.


Return on Assets

ROA vs Industry: AZZ's Return on Assets is below or equal to the Electrical industry average last year.


Return on Capital Employed

ROCE Improving: AZZ's Return on Capital Employed has declined over the past 3 years.


Next Steps

Financial Health

How is AZZ's financial position?


Financial Position Analysis

Short Term Liabilities: AZZ's short term assets ($396.9M) exceeds its short term liabilities ($138.8M)

Long Term Liabilities: AZZ's short term assets (396.9M) exceeds its long term liabilities (377.7M)


Debt to Equity History and Analysis

Debt Level: AZZ's debt to equity ratio (47.9%) is considered high

Reducing Debt: AZZ's debt to equity ratio has reduced from 102.1% to 47.9% over the past 5 years.

Debt Coverage: AZZ's debt is well covered by operating cash flow (36.5%).

Interest Coverage: AZZ's interest payments on its debt are well covered by EBIT (5.8x coverage).


Balance Sheet

Inventory Level: AZZ has a high level of physical assets or inventory.

Debt Coverage by Assets: AZZ's debt is covered by short term assets (assets are 1.337510x debt).


Next Steps

Dividend

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

1.75%

Expected Dividend Yield


Upcoming Dividend Payment

Purchase AZZ before the 'Buy Limit' to receive their next dividend payment.


Dividend Yield vs Market

company1.7%marketbottom25%1.5%markettop25%3.8%industryaverage2.1%forecastin3Years1.7%

Current dividend yield vs market & industry


Dividend Yield and Payments Analysis

Notable Dividend: AZZ's dividend (1.75%) is higher than the bottom 25% of dividend payers in the US market (1.46%).

High Dividend: AZZ's dividend (1.75%) is low compared to the top 25% of dividend payers in the US market (3.77%).

Stable Dividend: AZZ's dividends per share have been stable in the past 10 years.

Growing Dividend: AZZ's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (31.2%), AZZ's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: AZZ's dividends in 3 years are forecast to be well covered by earnings (21.2% payout ratio).


Next Steps

Management

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

5.4yrs

Average management tenure


CEO

Tom Ferguson (63yo)

5.9yrs

Tenure

US$2,782,725

Compensation

Mr. Thomas E. Ferguson, also known as Tom, has been the Chief Executive Officer and President of AZZ incorporated since November 4, 2013. He served as Chief Executive Officer, FlexSteel Pipeline Technologi ...


CEO Compensation Analysis

Compensation vs. Market: Tom's total compensation ($USD2.78M) is about average for companies of similar size in the US market ($USD2.71M).

Compensation vs Earnings: Tom's compensation has increased by more than 20% in the past year.


Management Age and Tenure

5.4yrs

Average Tenure

55yo

Average Age

Experienced Management: AZZ's management team is seasoned and experienced (5.4 years average tenure).


Board Age and Tenure

4.3yrs

Average Tenure

64yo

Average Age

Experienced Board: AZZ's board of directors are considered experienced (4.3 years average tenure).


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

BuyUS$45,47622 Oct 18
Paul Fehlman
EntityIndividual
Role
Chief Financial Officer
Senior VP of Finance & CFO
Shares1,000
Max PriceUS$45.48
BuyUS$228,83522 Oct 18
Thomas Ferguson
EntityIndividual
Role
Chief Executive Officer
President
Shares5,000
Max PriceUS$45.77

Ownership Breakdown


Management Team

  • Tom Ferguson (63yo)

    President

    • Tenure: 5.9yrs
    • Compensation: US$2.78m
  • Paul Fehlman (55yo)

    Senior VP of Finance & CFO

    • Tenure: 5.4yrs
    • Compensation: US$1.20m
  • Tara Mackey (49yo)

    Chief Legal Officer & Corporate Secretary

    • Tenure: 5.4yrs
    • Compensation: US$929.67k
  • Bryan Stovall (55yo)

    Senior Vice President of Metal Coatings

    • Tenure: 1.8yrs
  • Matt Emery (51yo)

    VP, Chief Information & HR Officer

    • Tenure: 6.8yrs
    • Compensation: US$774.98k
  • Chris Bacius (58yo)

    Vice President of Corporate Development

    • Tenure: 5.8yrs
    • Compensation: US$466.47k
  • James Byelick (62yo)

    Vice President & Chief Accounting Officer

    • Tenure: 2.3yrs
  • Ken Lavelle (62yo)

    President & GM of Electrical Platform

    • Tenure: 2.2yrs
    • Compensation: US$770.10k
  • Michael Doucet (46yo)

    Senior Vice President of Alternative Coatings

    • Tenure: 1.8yrs

Board Members

  • Dan Berce (65yo)

    Independent Director

    • Tenure: 19.8yrs
    • Compensation: US$172.00k
  • Dan Feehan (68yo)

    Independent Chairman

    • Tenure: 0.8yrs
    • Compensation: US$173.00k
  • Kevern Joyce (73yo)

    Independent Director

    • Tenure: 22.8yrs
    • Compensation: US$226.50k
  • Venita McCellon-Allen (59yo)

    Independent Director

    • Tenure: 3.6yrs
    • Compensation: US$165.00k
  • Steve Purvis (55yo)

    Independent Director

    • Tenure: 4.3yrs
    • Compensation: US$170.00k
  • Tom Ferguson (63yo)

    President

    • Tenure: 5.9yrs
    • Compensation: US$2.78m
  • Steve Pirnat (67yo)

    Independent Director

    • Tenure: 5.3yrs
    • Compensation: US$170.00k
  • Paul Eisman (64yo)

    Independent Director

    • Tenure: 3.8yrs
    • Compensation: US$170.00k
  • Ed McGough (58yo)

    Independent Director

    • Tenure: 2.8yrs
    • Compensation: US$165.00k

Company Information

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


Key Information

  • Name: AZZ Inc.
  • Ticker: AZZ
  • Exchange: NYSE
  • Founded: 1956
  • Industry: Heavy Electrical Equipment
  • Sector: Capital Goods
  • Market Cap: US$1.017b
  • Shares outstanding: 26.15m
  • Website: https://www.azz.com

Number of Employees


Location

  • AZZ Inc.
  • One Museum Place
  • Suite 500
  • Fort Worth
  • Texas
  • 76107
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
AZZNYSE (New York Stock Exchange)YesCommon StockUSUSDDec 1972
AI7DB (Deutsche Boerse AG)YesCommon StockDEEURDec 1972

Biography

AZZ Inc. provides galvanizing and metal coating services, welding solutions, specialty electrical equipment, and highly engineered services to the power generation, transmission, distribution, refining, an ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/14 01:01
End of Day Share Price2019/10/11 00:00
Earnings2019/05/31
Annual Earnings2019/02/28


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.

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