Acuity Brands, Inc.: Gathering momentum, can it sustain its performance?

Acuity Brands, Inc. relative valuation is OVERVALUED and it has a fundamental analysis score of 91.

Our analysis is based on comparing Acuity Brands, Inc. with the following peers – Revolution Lighting Technologies, Inc., Hubbell Incorporated Class B, Orion Energy Systems, Inc. and Royal Philips NV Sponsored ADR (RVLT-US, HUBB-US, OESX-US and PHG-US).

Acuity Brands, Inc. has shown underwhelming performance over the last one year while growing strongly over the last month. Acuity Brands, Inc.’s price momentum over the last month, at 20.41% has been better than that over the last year, which was -19.50%. Also from a peer group perspective, Acuity Brands, Inc. has performed better, since the peer group performance was -2.27% over the last month.

Company Snapshot

  • Compared to peers, relative underperformance over the last year is in contrast with the more recent outperformance.
  • It currently trades at a Price/Book ratio of (5.44).
  • AYI-US‘s operating performance is relatively good compared to its peers. The market currently does not expect high earnings growth relative to its peers but seems to expect the company to maintain its relatively high rates of return.
  • AYI-US has a successful operating model with relatively high net profit margins and asset turns.
  • Change in the company’s annual revenues seems to be coming at the expense of earnings.
  • AYI-US‘s return on assets currently and over the past five years suggest that its relatively high operating returns are sustainable.
  • The company’s relatively high gross and pre-tax margins suggest a differentiated product portfolio and tight control on operating costs relative to peers.
  • While AYI-US‘s revenues in recent years have grown faster than the peer median, the market gives the stock a P/E ratio that is around peer median suggesting that the market has some questions about the company’s long-term strategy.
  • The company’s level of capital investment seems appropriate to support the company’s growth.
  • AYI-US has the financial and operating capacity to borrow quickly.
  • Our analysis rates Acuity Brands, Inc. as OVERVALUED relative to its peers.

Share Price Performance

Compared to peers, relative underperformance over the last year is in contrast with the more recent outperformance.

AYI-US‘s share price performance of -19.50% over the last 12 months is below its peer median but its 30-day trend in share price performance of 20.41% is better than the peer median. This recent rising stock price may herald a change in relative share price performance.

Share Price Performance

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Leading, Fading, Lagging, Rising

Relative Valuation

Relative Valuation
Fundamental Score

Acuity Brands, Inc.’s price of USD 198.52 is greater than CapitalCube’s implied price of USD 125.82. At this level, CapitalCube believes that Acuity Brands, Inc. is overvalued. Over the last 52 week period, the stock has fluctuated between USD 157.33 and USD 280.89.

Valuation & Peer Metrics

A complete list of valuation metrics is available on the company page.

Company Profile

Acuity Brands, Inc. provides lighting and building management solutions for the commercial, institutional, industrial, infrastructure and residential applications throughout North America and selects international markets. Its lighting and system control product lines include Lithonia Lighting, Holophane, Peerless, Mark Architectural Lighting, Hydrel, American Electric Lighting, Gotham, Carandini, RELOC, Antique Street Lamps, Tersen, Winona Lighting, Synergy Lighting Controls, Sensor Switch, Lighting Control & Design, Dark to Light, ROAM, Sunoptics, acculamp, Healthcare Lighting and eldoLED. The company was founded in 2001 and is headquartered in Atlanta, GA.

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