AZZ (AZZ) AI Stock Analysis

• Market Cap: $3.03B
• Dividend Yield: 0.72%
• Average Volume (3M): 283.92K
• Price to Earnings (P/E): 9.7
• Beta (1Y): 1.25
• Revenue Growth: 1.55%
• EPS Growth: 701.41%
• Country: US
• Employees: 3,684
• Sector: Industrials
• Sector Strength: 72
• Industry: Manufacturing - Metal Fabrication
• EPS (TTM): 1.55
• Shares Outstanding: 30,057,081
• 10 Day Avg. Volume: 364,839
• 30 Day Avg. Volume: 283,919
• PEG Ratio: -0.45
• Price to Book (P/B): 2.67
• Price to Sales (P/S): 1.77
• P/FCF Ratio: 20.86
• Enterprise Value/Market Cap: 1.32
• Enterprise Value/Revenue: 2.51
• Enterprise Value/Gross Profit: 10.50
• Enterprise Value/Ebitda: 8.48
• 1Y Price Target: $126.50
• Price Target Upside: 28.31% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 6

• Rating: 73 Outperform
• Price Target: $112.00 ▲(13.60% Upside)

AZZ's strong financial performance and positive earnings call are significant strengths, indicating robust growth and financial stability. However, bearish technical indicators and challenges in the Precoat Metals segment present risks. The stock's valuation suggests potential undervaluation, but caution is advised due to mixed demand outlooks and technical weakness.

Positive Factors

Revenue Growth

The 2% increase in total sales reflects AZZ's ability to maintain growth momentum, driven by strong performance in the Metal Coatings segment, indicating robust demand and market presence.

Cash Flow Improvement

A 23% improvement in operating cash flow highlights AZZ's strong cash generation capabilities, enhancing its ability to reinvest in growth opportunities and manage debt effectively.

Debt Management

The significant reduction in the debt-to-equity ratio to 0.02 indicates improved financial stability and reduced financial risk, allowing for greater flexibility in strategic investments.

Negative Factors

Precoat Metals Segment Challenges

A 4.3% decline in Precoat Metals sales suggests challenges in demand within key end markets, potentially impacting future revenue and requiring strategic adjustments.

Margin Pressure

Margin pressures in the Precoat Metals segment due to customer buying patterns and new facility costs could affect profitability, necessitating cost management strategies.

Mixed Demand Outlook

The mixed demand outlook, influenced by tariffs and economic conditions, poses risks to consistent revenue growth, requiring careful market analysis and strategic planning.

AZZ Business Overview & Revenue Model

Company Description

AZZ Inc. offers galvanizing and metal coating solutions, welding solutions, specialty electrical equipment, and engineered services to the power generation, transmission, distribution, refining, and industrial markets in the United States and internationally. The company operates through two segments, Infrastructure Solutions and Metal Coatings. The Metal Coatings segment offers metal finishing solutions for corrosion protection, including hot-dip galvanizing, spin galvanizing, powder coating, anodizing, and plating to the steel fabrication and other industries. It serves fabricators or manufacturers that provide services to the electrical and telecommunications, bridge and highway, petrochemical, and general industrial markets, as well as original equipment manufacturers. The Infrastructure Solutions segment provides products and services to support industrial and electrical applications. It offers custom switchgear, electrical enclosures, medium and high voltage bus ducts, explosion proof and hazardous duty lighting, and tubular products, as well as solutions and engineering resources to multi-national companies. This segment sells its products through internal sales force, manufacturers' representatives, distributors, and agents. The company was incorporated in 1956 and is headquartered in Fort Worth, Texas.

How the Company Makes Money

AZZ generates revenue through its two main segments: Metal Coatings and Electrical. In the Metal Coatings segment, the company earns money by providing hot-dip galvanizing services, which involves coating steel products to prevent corrosion. This service is essential for industries that require durable steel structures, such as construction and infrastructure projects. The Electrical segment contributes to revenue through the sale of electrical equipment and services, including products used in power generation, transmission, and distribution. Key revenue streams include service contracts, product sales, and project-based contracts. Additionally, AZZ benefits from strategic partnerships with various companies in the construction and energy sectors, which help to secure long-term contracts and expand its market presence. Factors contributing to its earnings include the increasing demand for corrosion-resistant materials and a growing focus on infrastructure development.

AZZ Financial Statement Overview

Summary

AZZ exhibits strong financial health with impressive revenue and profit growth, efficient leverage management, and robust cash flow generation. The company has effectively reduced its debt burden, enhancing financial stability. Minor concerns include gross profit margin pressures and historical cash flow volatility.

Income Statement

AZZ has demonstrated strong revenue growth, particularly in the TTM period with a 52.1% increase. The company maintains robust profitability with a high net profit margin of 19.7% and an EBIT margin of 25.7%. These metrics indicate effective cost management and operational efficiency. However, the gross profit margin has slightly decreased compared to previous periods, suggesting potential pressure on production costs.

Balance Sheet

The balance sheet shows a significant improvement in leverage, with the debt-to-equity ratio dropping to 0.02 in the TTM period, indicating reduced financial risk. Return on equity is strong at 27.4%, reflecting efficient use of equity to generate profits. However, the equity ratio is not explicitly provided, which limits a full assessment of asset financing.

Cash Flow

AZZ's cash flow performance is solid, with a notable increase in free cash flow growth by 6.2% in the TTM period. The operating cash flow to net income ratio of 2.24 suggests strong cash generation relative to earnings. The free cash flow to net income ratio is also healthy at 0.81, indicating good cash conversion. However, historical fluctuations in free cash flow growth highlight potential volatility.

Breakdown	TTM	Dec 2025	Dec 2023	Dec 2022	Dec 2021	Dec 2019
Income Statement
Total Revenue	1.59B	1.58B	1.32B	525.60M	480.57M	927.09M
Gross Profit	381.92M	382.68M	295.94M	146.15M	122.90M	198.62M
EBITDA	473.12M	334.17M	252.06M	111.47M	105.25M	128.22M
Net Income	314.07M	128.83M	79.11M	84.02M	39.61M	51.21M
Balance Sheet
Total Assets	2.23B	2.23B	2.22B	1.13B	996.44M	1.09B
Cash, Cash Equivalents and Short-Term Investments	897.00K	1.49M	2.82M	12.08M	14.84M	24.00M
Total Debt	597.31M	879.13M	1.09B	241.18M	217.67M	240.75M
Total Liabilities	922.95M	1.18B	1.37B	465.66M	375.94M	484.84M
Stockholders Equity	1.30B	1.05B	853.46M	667.37M	623.29M	603.73M
Cash Flow
Free Cash Flow	407.09M	134.03M	34.31M	57.60M	54.96M	89.05M
Operating Cash Flow	503.65M	249.91M	91.43M	86.01M	92.03M	114.67M
Investing Cash Flow	-122.75M	-115.00M	-1.23B	-86.83M	-28.59M	-32.07M
Financing Cash Flow	-382.56M	-138.69M	1.15B	912.00K	-88.42M	-78.00M

AZZ Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 98.59
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Positive
• RSI: Positive
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AZZ, the sentiment is Negative. The current price of 98.59 is below the 20-day moving average (MA) of 109.82, below the 50-day MA of 111.91, and above the 200-day MA of 96.12, indicating a neutral trend. The MACD of -2.93 indicates Positive momentum. The RSI at 23.82 is Positive, neither overbought nor oversold. The STOCH value of 30.44 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for AZZ.

AZZ Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PRLB	77 Outperform	$1.17B	80.14	2.19%	―	-0.13%	-37.00%
AZZ	73 Outperform	$3.03B	9.69	27.28%	0.72%	1.55%	701.41%
NWPX	72 Outperform	$485.30M	14.88	9.14%	―	5.83%	33.50%
IIIN	72 Outperform	$739.13M	23.90	8.87%	2.94%	9.44%	53.83%
WOR	64 Neutral	$2.77B	26.06	11.50%	1.27%	-39.38%	175.22%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
RYI	58 Neutral	$735.75M	37.86	-1.73%	3.42%	-7.98%	-124.63%

AZZ Corporate Events

AZZ Unveils New Investor Presentation Materials

On August 14, 2025, AZZ Inc. announced the release of presentation materials intended for use with investors and stakeholders, highlighting its strategic focus on metal coatings and sustainability initiatives. The company emphasized its commitment to growth through operational improvements, strategic acquisitions, and disciplined capital allocation, aiming to enhance shareholder value and maintain a strong market position in the North American steel and aluminum sectors.

AZZ Inc. Successfully Reprices $434.9 Million Term Loan

On August 5, 2025, AZZ Inc. announced the successful repricing of its $434.9 million Term Loan B, reducing the interest rate margin by 75 basis points to SOFR + 175 basis points, resulting in annual interest savings of approximately $3.3 million. This marks the fourth repricing since the loan’s issuance in May 2022, achieving total interest rate margin savings of 250 basis points, and reflects AZZ’s disciplined approach to managing its net debt to EBITDA leverage ratio, which stood at 1.7x as of May 2025.

AZZ Secures $150 Million Securitization Facility

On July 10, 2025, AZZ Inc. and its subsidiaries entered into a three-year $150 million accounts receivable securitization facility with Wells Fargo Bank. This facility allows AZZ SPE-1 LLC, a special purpose subsidiary, to draw up to $150 million in revolving loans, aimed at reducing interest costs by paying down existing debt. The securitization facility, which includes various agreements and covenants, is designed to enhance AZZ’s financial flexibility and operational efficiency by securing lower interest rates and providing structured financing options.

AZZ Releases Investor Presentation Highlighting Growth Strategy

On July 10, 2025, AZZ Inc. announced the release of presentation materials intended for investors and stakeholders, highlighting its strategic focus on growth and sustainability. The company aims to reduce debt, improve leverage, and support high return on invested capital (ROIC) investments while maintaining a commitment to environmental, social, and governance (ESG) initiatives. Recent achievements include a reduction in net leverage, an increase in dividends, and the acquisition of Canton Galvanizing, reflecting AZZ’s robust growth strategy and commitment to shareholder value.

AZZ Shareholders Approve Key Proposals at Annual Meeting

On July 8, 2025, AZZ Inc. held its annual meeting of shareholders where three proposals were approved. These included the election of seven directors for a one-year term, approval of the executive compensation program, and ratification of Grant Thornton LLP as the independent registered public accounting firm for the fiscal year ending February 28, 2026. The approval of these proposals reflects shareholder support for the company’s leadership and financial oversight, potentially impacting its governance and operational strategies.

AZZ Increases Dividend by 17.6% for Q1 2026

On June 26, 2025, AZZ Inc. announced a 17.6% increase in its fiscal year 2026 first quarter cash dividend, raising it from $0.17 to $0.20 per share, payable on July 31, 2025. This decision reflects AZZ’s commitment to enhancing shareholder value while considering factors like operating results and financial condition.