Acuity Brands, Inc.
Acuity Brands, Inc. Fundamental Analysis
Acuity Brands, Inc. (AYI) shows moderate financial fundamentals with a PE ratio of 19.57, profit margin of 9.04%, and ROE of 15.45%. The company generates $4.5B in annual revenue with strong year-over-year growth of 13.14%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 77.1/100 based on profitability, valuation, growth, and balance sheet metrics. The B grade reflects solid fundamentals with room for improvement in valuation or growth.
Fundamental Health Score
We analyze AYI's fundamental strength across five key dimensions:
Efficiency Score
WeakAYI struggles to generate sufficient returns from assets.
Valuation Score
ModerateAYI shows balanced valuation metrics.
Growth Score
ModerateAYI shows steady but slowing expansion.
Financial Health Score
ExcellentAYI maintains a strong and stable balance sheet.
Profitability Score
ModerateAYI maintains healthy but balanced margins.
Key Financial Metrics
Is AYI Expensive or Cheap?
P/E Ratio
AYI trades at 19.57 times earnings. This indicates a fair valuation.
PEG Ratio
When adjusting for growth, AYI's PEG of 5.35 indicates potential overvaluation.
Price to Book
The market values Acuity Brands, Inc. at 2.88 times its book value. This may indicate undervaluation.
EV/EBITDA
Enterprise value stands at 11.06 times EBITDA. This signals the market has high growth expectations.
How Well Does AYI Make Money?
Net Profit Margin
For every $100 in sales, Acuity Brands, Inc. keeps $9.04 as profit after all expenses.
Operating Margin
Core operations generate 13.02 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $15.45 in profit for every $100 of shareholder equity.
ROA
Acuity Brands, Inc. generates $8.82 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Acuity Brands, Inc. produces operating cash flow of $609.16M, showing steady but balanced cash generation.
Free Cash Flow
Acuity Brands, Inc. generates strong free cash flow of $533.76M, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $17.41 in free cash annually.
FCF Yield
AYI converts 6.70% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
19.57
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
5.35
vs 25 benchmark
P/B Ratio
Price to book value ratio
2.88
vs 25 benchmark
P/S Ratio
Price to sales ratio
1.77
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.33
vs 25 benchmark
Current Ratio
Current assets to current liabilities
2.07
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.15
vs 25 benchmark
ROA
Return on assets percentage
0.09
vs 25 benchmark
ROCE
Return on capital employed
0.15
vs 25 benchmark
How AYI Stacks Against Its Sector Peers
| Metric | AYI Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 19.57 | 25.84 | Better (Cheaper) |
| ROE | 15.45% | 1279.00% | Weak |
| Net Margin | 9.04% | -43714.00% (disorted) | Weak |
| Debt/Equity | 0.33 | 0.80 | Strong (Low Leverage) |
| Current Ratio | 2.07 | 10.62 | Strong Liquidity |
| ROA | 8.82% | -1537441.00% (disorted) | Weak |
AYI outperforms its industry in 3 out of 6 key metrics, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Acuity Brands, Inc.'s 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
67.23%
Industry Style: Cyclical, Value, Infrastructure
High GrowthEPS CAGR
104.45%
Industry Style: Cyclical, Value, Infrastructure
High GrowthFCF CAGR
52.50%
Industry Style: Cyclical, Value, Infrastructure
High Growth