Fact based stock research
AZZ (NYSE:AZZ)

US0024741045

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For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".

Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".

Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.

Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.

(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).

(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.

AZZ stock research in summary

azz.com

ANALYSIS: With an Obermatt Combined Rank of 18 (worse than 82% compared with investment alternatives), AZZ (Heavy Electrical Equipment, USA) shares have lower financial characteristics compared with similar stocks. Shares of AZZ are a good value (attractively priced) with a consolidated Value Rank of 65 (better than 65% of alternatives) but show below-average growth (Growth Rank of 35), and are riskily financed (Safety Rank of 23), which means above-average debt burdens. ...read more

RECOMMENDATION: A Combined Rank of 18, is a sell recommendation based on AZZ's financial characteristics. As the company AZZ's key financial metrics exhibit good value (Obermatt Value Rank of 65) but low growth (Obermatt Growth Rank of 35) and risky financing practices (Obermatt Safety Rank of 23), it may be a risky investment, because debt in times of crises can make things worse. The good value, better than 65% of comparable companies, may indicate the company's future is challenging. If you believe that low growth is temporary or just due to a specific current event, you may conclude that the good value of the stock provides an attractive investment opportunity. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

Latest Obermatt Ranks


360° View^new
Sentiment Rank^new
Value Rank	65
Growth Rank	35
Safety Rank	23
Combined Rank	18

Country	USA
Industry	Heavy Electrical Equipment
Index	Dividends USA
Size class	Large

14-Nov-2024. Stock data may be delayed. Log in or sign up to get the most recent research.

Further information

Multiple opinions. One number.

Analysts rarely agree on a stock’s future. So, who do you believe? Obermatt translates those collective views into a single Sentiment Rank. That plus the financial ranks give you the ultimate 360° View. Sign up to access them.

Why popular stocks have low ratings

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Review the performance ranks of the individual metrics that form each investment strategy.

Research History: AZZ

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	86	85	91	65
GROWTH
GROWTH	48	91	93	35
SAFETY
SAFETY	39	88	21	23
SENTIMENT
SENTIMENT	n/a	17	85	^new
360° VIEW
360° VIEW	n/a	93	93	^new

Most recent update of the stock research: 14-Nov-2024. Financial reporting date used for calculating ranks: 31-May-2024. Stock research history is based on the Obermatt Method. The higher the rank, the better AZZ is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	86	85	91	65
GROWTH
GROWTH	48	91	93	35
SAFETY
SAFETY	39	88	21	23
COMBINED
COMBINED	58	100	88	18

Last update of combined financial performance: 14-Nov-2024. Stock analysis on combined financial performance: The higher the rank of AZZ the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 65 (better than 65% compared with alternatives), AZZ shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators, with half of the indicators below and half above average for AZZ. Price-to-Profit (also referred to as price-earnings, P/E) is 65 which means that the stock price compared with what market professionals expect for future profits is lower than for 65% of comparable companies, indicating a good value concerning AZZ's profit levels. The same is valid for Price-to-Book Capital (also referred to as market-to-book ratio) with a Price-to-Book Rank of 47, which means that the stock price is lower as regards to invested capital than for 47% of comparable investments. On the other hand, Price-to-Sales is less favorable than 59% of alternatives (only 41% of peers have an even less favorable ratio). The same is valid for dividend yield, which is lower than 15% of comparable companies, making the stock more expensive as regards to the company's expected dividend payouts. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 65, is a buy recommendation based on AZZ's stock price compared with the company's operational size and dividend yields. This is a puzzling picture, because it means that profits are high while dividends are low. Since the stock price is low compared with invested capital but high in respect to expected revenues, it means that the company has more invested capital than peers for generating the same amount of revenue. Since profits are higher, it could be a "cash cow" situation (using the classic Boston Consulting BCG matrix naming convention) where the company is on a downward trend, still living from the profits of past products. As the company pays low dividends, it may harbor the opinion that a turnaround is possible, and it rather invests the cash than pay it out to shareholders, thus sealing the company's fate early. Any investment optimism should only be a buy trigger once thorough research is completed. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is especially important in this case, as the financial indicators are inconclusive. ...read more

VALUE METRICS	2021	2022	2023	2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)	66	57	57	41
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	80	70	78	65
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	71	64	64	47
DIVIDEND YIELD
DIVIDEND YIELD	79	89	89	85
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	86	85	91	65

Last update of Value Rank: 14-Nov-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of AZZ; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 35 (better than 35% compared with alternatives), AZZ shows a below-average growth dynamic in its industry. There is limited momentum in this company. The Growth Rank is based on consolidating four value indicators, with half of the indicators below and half above average for AZZ. Profit Growth has a rank of 63, which means that currently professionals expect the company to grow its profits more than 63% of its competitors. This is a good sign for shareholders, which is confirmed by an above-average Stock Returns rank of 89 (above 89% of alternative investments). But Sales Growth has a below the median rank of 18, which means that, currently, professionals expect the company to grow less than 82% of its competitors, and Capital Growth also has a lower rank of 1. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 35, is a hold recommendation for growth and momentum investors. Because revenues and invested capital are the more solid growth indicators, the positive development on the profit side is less relevant. It may have been caused by cost-cutting, which may be a negative growth indicator. Finally, the above-average stock returns recently are a thing of the past and not a good indicator of future returns. Investors should be confident that the cost-cutting initiative leading to higher profits is to benefit the company's future. If not, there is little growth momentum, and investment is only advisable if the Value Ranks suggest a good investment timing for AZZ. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case, especially since the growth performance is mixed here. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	15	24	36	18
PROFIT GROWTH
PROFIT GROWTH	42	73	68	63
CAPITAL GROWTH
CAPITAL GROWTH	n/a	97	99	1
STOCK RETURNS
STOCK RETURNS	73	63	87	89
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	48	91	93	35

Last update of Growth Rank: 14-Nov-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of AZZ.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 23 (better than 23% compared with alternatives), the company AZZ has much riskier financing practices than comparable other companies, which means that their overall debt burden is significantly above the industry average. This doesn't mean that the business of AZZ is also risky, it only means that the company is on the riskier side in respect to bankruptcy in case things turn sour, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with just one indicator above average for AZZ. Liquidity is at 58, meaning the company generates more profit to service its debt than 58% of its competitors. This indicates that the company is safer when it comes to debt service. But Refinancing is riskier at a rank of 27, which means that the portion of the debt that is about to be refinanced is above average. It has more debt in the refinancing stage than 73% of its competitors. Leverage is also high at a rank of 19, which means that the company has an above-average debt-to-equity ratio. It has more debt than 81% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 23 (worse than 77% compared with alternatives), AZZ has a financing structure that is significantly riskier than that of its competitors. High Leverage (a low Obermatt Leverage Rank) is good in good times, because it usually indicates that shareholders get higher returns. The good Liquidity performance of the company is an indicator that this is the case. However, if you expect an economic downturn, you may stay clear of this stock because they have an above-average debt level that needs refinancing soon. If the company is sailing with good winds, as may be visible from the Growth and Sentiment performance, the refinancing risk may be lower than the low Refinancing rank suggests. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	17	66	10	19
REFINANCING
REFINANCING	65	45	37	27
LIQUIDITY
LIQUIDITY	59	73	44	58
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	39	88	21	23

Last update of Safety Rank: 14-Nov-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of AZZ and the more cash is available to service its debt.

Sentiment Metrics in Detail

SENTIMENT	2021	2022	2023	2024
ANALYST OPINIONS
ANALYST OPINIONS	n/a	30	88	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	50	50	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	27	87	^new
MARKET PULSE
MARKET PULSE	n/a	42	30	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	17	85	^new

Last update of Sentiment Rank: 14-Nov-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for AZZ.
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