Acuity Brands (AYI) AI Stock Analysis

• Market Cap: $8.38B
• Dividend Yield: 0.24%
• Average Volume (3M): 409.50K
• Price to Earnings (P/E): 20.7
• Beta (1Y): 1.25
• Revenue Growth: 2.78%
• EPS Growth: 11.53%
• Country: US
• Employees: 13,200
• Sector: Industrials
• Sector Strength: 91
• Industry: Electrical Equipment & Parts
• EPS (TTM): 3.73
• Shares Outstanding: 30,904,947
• 10 Day Avg. Volume: 221,243
• 30 Day Avg. Volume: 409,502
• PEG Ratio: -6.65
• Price to Book (P/B): 3.09
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 17.07
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $308.75
• Price Target Upside: 14.50% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 5

Acuity Brands demonstrates strong financial health with robust profitability and efficient cash flow management. The recent earnings call highlighted significant growth in key segments and successful strategic initiatives. While the stock shows positive market momentum, its slightly high valuation and low dividend yield suggest moderate caution for new investors. The company's rebranding strategy further supports its growth and innovation narrative.

Positive Factors

Competitiveness

Acuity is better positioned relative to competitors to weather tariff disruption due to its global supply chain.

Gross Margin Performance

The sizeable gross margin beat in FQ2 signals potential upside in the second half of the fiscal year.

USMCA Compliance

Acuity Brands is seen as competitively advantaged as a USMCA-compliant producer in Mexico compared to Asia.

Negative Factors

Demand Uncertainty

Uncertainty on demand impact related to tariffs.

Project Timing and Margins

The biggest near-term risk is tariffs impacting project timing and gross margins.

Tariff Impact

There will be a near term headwind due to a price lag in response to tariffs.

Acuity Brands Business Overview & Revenue Model

Company Description

Acuity Brands, Inc. (AYI) is a leading industrial technology company that specializes in lighting, lighting controls, and building management solutions. Headquartered in Atlanta, Georgia, Acuity Brands operates primarily in the North American market, catering to a wide array of industries including commercial, industrial, infrastructure, and residential sectors. The company's core products include a comprehensive range of indoor and outdoor lighting fixtures, lighting controls, and related products and services designed to optimize energy efficiency and enhance the quality of lighting environments.

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 exhibits strong financial performance with robust profitability, a stable balance sheet, and effective cash flow management. The income statement reflects solid margins, though there's a slight decline in net profit margin. The balance sheet shows financial stability with moderate leverage, and cash flow management remains strong despite minor declines in free cash flow growth.

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
	EBIT
545.80M	553.30M	473.40M	509.70M	427.60M	353.90M
	EBITDA
620.90M	665.00M	588.50M	603.20M	520.50M	479.30M
	Net Income Common Stockholders
417.00M	422.60M	346.00M	384.00M	306.30M	248.30M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
397.90M	845.80M	397.90M	223.20M	491.30M	560.70M
	Total Assets
4.58B	3.81B	3.41B	3.48B	3.58B	3.49B
	Total Debt
1.19B	573.50M	495.60M	513.00M	494.30M	401.10M
	Net Debt
794.20M	-272.30M	97.70M	289.80M	3.00M	-159.60M
	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: Neutral
• Last Price: 269.64
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• 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 Neutral. The current price of 269.64 is above the 20-day moving average (MA) of 255.62, above the 50-day MA of 253.78, and below the 200-day MA of 284.80, indicating a neutral trend. The MACD of 6.14 indicates Negative momentum. The RSI at 62.49 is Neutral, neither overbought nor oversold. The STOCH value of 82.04 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for AYI.

Acuity Brands Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
NVT	81 Outperform	$10.96B	19.29	7.63%	1.15%	-5.12%	1.69%
AYI	80 Outperform	$8.38B	20.71	17.86%	0.24%	2.78%	11.53%
POWL	78 Outperform	$2.20B	12.88	37.08%	0.58%	27.43%	67.93%
AEIS	74 Outperform	$4.40B	61.05	6.36%	0.34%	0.06%	-28.32%
ATKR	72 Outperform	$2.31B	13.21	12.73%	1.86%	-12.02%	-67.69%
ENS	67 Neutral	$3.88B	12.17	18.36%	0.96%	-2.94%	22.32%
Sector *	64 Neutral	$4.44B	11.99	5.16%	249.23%	4.01%	-11.87%

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.