AZZ Inc. Fundamental Analysis (NYSE: AZZ)
AZZ Inc. (NYSE: AZZ) shows moderate financial fundamentals with a PE ratio of 22.30, profit margin of 11.83%, and ROE of 14.87%. The company generates $1.7B in annual revenue with weak year-over-year growth of 2.61%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 60.5/100 based on profitability, valuation, growth, and balance sheet metrics. The C+ grade reflects average fundamentals, with notable risks in certain areas.
Fundamental Health Score
We analyze AZZ's fundamental strength across five key dimensions:
Efficiency Score
WeakAZZ struggles to generate sufficient returns from assets.
Valuation Score
ExcellentAZZ trades at attractive valuation levels.
Growth Score
WeakAZZ faces weak or negative growth trends.
Financial Health Score
ExcellentAZZ maintains a strong and stable balance sheet.
Profitability Score
WeakAZZ struggles to sustain strong margins.
Key Financial Metrics
Is AZZ Expensive or Cheap?
P/E Ratio
AZZ trades at 22.30 times earnings. This indicates a fair valuation.
PEG Ratio
When adjusting for growth, AZZ's PEG of -0.93 indicates potential undervaluation.
Price to Book
The market values AZZ Inc. at 3.21 times its book value. This suggests the stock is fully valued or overvalued on an asset basis.
EV/EBITDA
Enterprise value stands at 10.31 times EBITDA. This signals the market has high growth expectations.
How Well Does AZZ Make Money?
Net Profit Margin
For every $100 in sales, AZZ Inc. keeps $11.83 as profit after all expenses.
Operating Margin
Core operations generate 16.23 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $14.87 in profit for every $100 of shareholder equity.
ROA
AZZ Inc. generates $8.81 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
AZZ Inc. produces operating cash flow of $248.80M, showing steady but balanced cash generation.
Free Cash Flow
AZZ Inc. generates strong free cash flow of $169.86M, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $5.65 in free cash annually.
FCF Yield
AZZ converts 3.83% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
22.30
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
-0.93
vs 25 benchmark
P/B Ratio
Price to book value ratio
3.21
vs 25 benchmark
P/S Ratio
Price to sales ratio
2.64
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.39
vs 25 benchmark
Current Ratio
Current assets to current liabilities
1.92
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
0.13
vs 25 benchmark
How AZZ Stacks Against Its Sector Peers
| Metric | AZZ Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 22.30 | 30.77 | Better (Cheaper) |
| ROE | 14.87% | 1146.00% | Weak |
| Net Margin | 11.83% | -20835.00% (disorted) | Strong |
| Debt/Equity | 0.39 | 0.38 | Neutral |
| Current Ratio | 1.92 | 24.28 | Neutral |
| ROA | 8.81% | -1313619.00% (disorted) | Weak |
AZZ outperforms its industry in 2 out of 6 key metrics, particularly excelling in Net Margin, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews AZZ Inc.'s 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
33.80%
Industry Style: Cyclical, Value, Infrastructure
High GrowthEPS CAGR
140.51%
Industry Style: Cyclical, Value, Infrastructure
High GrowthFCF CAGR
55.45%
Industry Style: Cyclical, Value, Infrastructure
High Growth