What to Expect From Acuity Brands’ Earnings Next Week

The lighting and building management firm Acuity Brands is expected to report its fiscal first-quarter earnings of $2.2 per share, which represents year-over-year growth of over 17%, up from $1.87 per share seen in the same period a year ago.

The Atlanta, Georgia-based company would post year-over-year revenue growth of more than 11% to around $ 880.24 million. The company has been able to beat earnings per share (EPS) estimates most of the time in the last two years.

Acuity Brands’ stock traded 0.45% higher at $215.915 on Wednesday. It surged over 78% so far this year.

Analyst Comments

“Shares of Acuity Brands have outperformed its industry so far this year. The trend is likely to continue, given the company’s consistent focus on cost-saving initiative and strategy to enhance its portfolio. Its leading market position, diversified portfolio of innovative lighting control solutions and energy-efficient luminaries, along with accretive buyouts are the driving factors,” noted equity analysts at ZACKS Research.

“Notably, earnings estimate for 2021 have increased 6.9% over the past 90 days, depicting analysts’ optimism over the company’s prospects. Although its ability to successfully leverage fixed costs is commendable, rising costs and volatile business environment are causes of concerns.”

Acuity Brands Stock Price Forecast

Six analysts who offered stock ratings for Acuity Brands in the last three months forecast the average price in 12 months of $221.60 with a high forecast of $229.00 and a low forecast of $206.00.

The average price target represents a 2.89% change from the last price of $215.38. Of those six analysts, five rated “Buy”, one rated “Hold” while none rated “Sell”, according to Tipranks.

Several other analysts have updated their stock outlook in October. Oppenheimer raised the target price to $225 from $205. Cowen and company lifted the price objective to $223 from $184. Credit Suisse upped the target price to $225 from $209.

Technical analysis also suggests it is good to buy as 100-Day Moving Average and 100-200-day MACD Oscillator signals a strong buying opportunity.

“We remain constructive on Acuity’s product breadth, top-notch agent channel, and leadership in control integration. This positioning should allow the company to outperform the market, even when macro challenges present themselves. The company boasts a 40%+ gross margin and has a strong cash flow generation profile,” said Jeffrey Osborne, equity analyst at Cowen in Oct 6 research note.

“As macro conditions improve we expect more large-scale higher-margin projects will begin to move off the sidelines. This should help to further support the company’s margin profile longer term. We believe that Acuity is differentiated relative to its peers and has an early lead in the intelligent building market thanks to its Distech and Atrius products. Longer-term, we see an opportunity in the UVC germicidal market and believe the company is well-positioned given its many partnerships in the space.”

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