Acuity Brands (AYI) AI Stock Analysis

• Market Cap: $9.30B
• Dividend Yield: 0.22%
• Average Volume (3M): 307.55K
• Price to Earnings (P/E): 23.9
• Beta (1Y): 1.29
• Revenue Growth: 9.16%
• EPS Growth: 4.09%
• Country: US
• Employees: 13,200
• Sector: Industrials
• Sector Strength: 87
• Industry: Electrical Equipment & Parts
• EPS (TTM): 5.12
• Shares Outstanding: 30,644,833
• 10 Day Avg. Volume: 509,027
• 30 Day Avg. Volume: 307,554
• PEG Ratio: -7.23
• Price to Book (P/B): 3.36
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 18.56
• Enterprise Value/Market Cap: 0.99
• Enterprise Value/Revenue: 0.60
• Enterprise Value/Gross Profit: 5.00
• Enterprise Value/Ebitda: 3.64
• 1Y Price Target: $337.50
• Price Target Upside: 13.13% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 5

• Rating: 76 Outperform
• Price Target: $344.00 ▲(15.30%Upside)

Acuity Brands demonstrates robust financial performance and growth prospects, supported by strong earnings results and strategic initiatives. The technical indicators suggest bullish momentum, but caution is warranted due to overbought signals. Valuation metrics present a mixed picture with a moderate P/E ratio but low dividend yield. Overall, the company's strategic growth initiatives and solid financial health lead to a favorable stock evaluation.

Positive Factors

Competitive Advantage

AYI is seen as competitively advantaged compared to low-cost Chinese competitors due to its USMCA-compliant Mexican production.

Earnings Potential

The price target for Acuity Brands Inc. has been raised to $285, indicating confidence in its potential growth.

Market Positioning

Acuity Brands is positioned for growth due to a strong opportunity for gaining market share.

Negative Factors

Fiscal Guidance

Fiscal 2025 guidance was maintained despite the third-quarter beat, as the fourth quarter will see pull-forward giveback and lower gross margins as tariffs are passed on dollar for dollar.

Revenue Seasonality

There is a risk for Acuity of below-average revenue seasonality during the second half if project pull-forward was meaningful.

Acuity Brands Business Overview & Revenue Model

Company Description

Acuity Brands, Inc. provides lighting and building management solutions in North America and internationally. The company operates through two segments, Acuity Brands Lighting and Lighting Controls (ABL); and the Intelligent Spaces Group (ISG). The ABL segment provides commercial, architectural, and specialty lighting solutions, as well as lighting controls and components for various indoor and outdoor applications under the Lithonia Lighting, Holophane, Peerless, Gotham, Mark Architectural Lighting, Winona Lighting, Juno, Indy, Aculux, Healthcare Lighting, Hydrel, American Electric Lighting, Sunoptics, eldoLED, nLight, Sensor Switch, IOTA, A-Light, Cyclone, Eureka, Lumniaire LED, Luminis, Dark to Light, and RELOC Wiring Solutions brands. This segment serves electrical distributors, retail home improvement centers, electric utilities, national accounts, digital retailers, lighting showrooms, and energy service companies. The ISG segment offers building management systems and location-aware applications under the Distech Controls, Atrius, and Rockpile Ventures brands. This segment serves system integrators, as well as retail stores, airports, and enterprise campuses. Acuity Brands, Inc. was incorporated in 2001 and is headquartered in Atlanta, Georgia.

How the Company Makes Money

Acuity Brands makes money primarily through the sale of its lighting and building management products and solutions. The company's revenue streams are driven by the manufacturing and distribution of lighting fixtures, lighting controls, and building management systems. Acuity Brands serves a diverse customer base which includes electrical distributors, retail home improvement centers, lighting showrooms, and various other commercial and industrial customers. The company also benefits from strategic partnerships and collaborations with technology partners to enhance its product offerings with advanced digital solutions. Additionally, Acuity Brands focuses on expanding its market presence through acquisitions and investments in new technologies to drive growth and increase its market share.

Acuity Brands Financial Statement Overview

Summary

Acuity Brands shows strong profitability with robust EBIT and EBITDA margins, supported by stable revenue and a solid equity base. Although there is a slight decline in net profit margin and free cash flow growth, overall financial health remains strong with efficient operations and sound capital structure.

Income Statement

Acuity Brands shows a strong gross profit margin of 46.7% TTM, supported by stable revenue growth. However, the net profit margin has seen a slight decline from the previous year. The EBIT and EBITDA margins remain robust at 13.8% and 15.7% respectively, indicating efficient operations. The company is maintaining solid profitability despite slight fluctuations in net income.

Balance Sheet

The balance sheet reflects a solid equity base with an equity ratio of 55.0% TTM, indicating financial stability. The debt-to-equity ratio at 0.47 shows moderate leverage. Return on equity stands at 16.5% TTM, showcasing effective utilization of shareholders' funds. The overall balance sheet is healthy with a strong equity position, but there is a slight increase in debt levels.

Cash Flow

Operating cash flow remains strong, with a healthy ratio of 1.24 when compared to net income, indicating strong cash generation. Free cash flow has decreased slightly but remains positive, with a free cash flow to net income ratio of 1.09. The company demonstrates robust cash flow management, although there is a slight decline in free cash flow growth.

Breakdown	TTM	Sep 2024	Sep 2023	Sep 2022	Sep 2021	Sep 2020
Income Statement
Total Revenue	3.96B	3.84B	3.95B	4.01B	3.46B	3.33B
Gross Profit	1.85B	1.78B	1.71B	1.67B	1.48B	1.40B
EBITDA	620.90M	665.00M	588.50M	603.20M	520.50M	479.30M
Net Income	417.00M	422.60M	346.00M	384.00M	306.30M	248.30M
Balance Sheet
Total Assets	4.58B	3.81B	3.41B	3.48B	3.58B	3.49B
Cash, Cash Equivalents and Short-Term Investments	397.90M	845.80M	397.90M	223.20M	491.30M	560.70M
Total Debt	1.19B	573.50M	495.60M	513.00M	494.30M	401.10M
Total Liabilities	2.06B	1.44B	1.39B	1.57B	1.53B	1.36B
Stockholders Equity	2.52B	2.38B	2.02B	1.91B	2.04B	2.13B
Cash Flow
Free Cash Flow	454.60M	555.20M	511.40M	259.80M	364.90M	449.90M
Operating Cash Flow	518.20M	619.20M	578.10M	316.30M	408.70M	504.80M
Investing Cash Flow	-1.22B	―	-90.70M	-62.20M	-117.90M	-359.80M
Financing Cash Flow	534.20M	-104.50M	-312.90M	-512.40M	-362.60M	-50.30M

Acuity Brands Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 298.34
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AYI, the sentiment is Positive. The current price of 298.34 is above the 20-day moving average (MA) of 276.14, above the 50-day MA of 263.13, and above the 200-day MA of 289.25, indicating a bullish trend. The MACD of 9.32 indicates Negative momentum. The RSI at 68.89 is Neutral, neither overbought nor oversold. The STOCH value of 81.63 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AYI.

Acuity Brands Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
NVT	82 Outperform	$12.08B	20.95	7.63%	1.09%	-5.12%	1.69%
POWL	78 Outperform	$2.57B	14.97	37.08%	0.50%	27.43%	67.93%
AYI	76 Outperform	$9.30B	23.90	16.60%	0.22%	9.16%	4.09%
AEIS	76 Outperform	$4.98B	68.37	6.36%	0.30%	0.06%	-28.32%
ATKR	74 Outperform	$2.39B	13.70	12.73%	1.85%	-12.02%	-67.69%
ENS	73 Outperform	$3.35B	9.65	19.82%	1.11%	1.00%	38.51%
Sector *	71 Outperform	¥255.65B	12.95	8.49%	3.09%	6.31%	12.94%

Acuity Brands Corporate Events

Acuity Brands Announces Corporate Name Change to Acuity Inc.

On March 11, 2025, Acuity Brands, Inc. announced a corporate name change to Acuity Inc., effective March 26, 2025, as part of a rebranding strategy to align its business segments and promote a cohesive brand experience. This change reflects the company’s evolution and its strategy for growth, positioning Acuity as an innovator and disruptor in the industry, with a focus on creating stakeholder value and compounding shareholder wealth.