AZZ Inc (AZZ) – Improving margins lead management to bump up guidance


Thursday, January 11, 2024

Michael Heim, Senior Vice President, Equity Research Analyst, Energy & Transportation, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

Sales grew as expected as we head into the slower, winter months. Sales in the most recent quarter rose 2.2% year over year with Metal Coatings sales increasing 3.1% and Precoat Metal sales growing 1.6%. Management cited a shift from plastic to aluminum material and tail winds from the 2021 Infrastructure Investment and Jobs Act.

Margins continue to improve with the shift towards Metal Coatings business and operational efficiencies. EBITDA margins grew to 22.6% of sales versus 18.5%. The improvement reflects operational efficiencies and higher growth for the higher margin Metal Coating business.


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*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision. 

Release – AZZ Inc. to Present and Host Meetings at the 19th Annual Noble Capital Markets Conference on December 4, 2023

Research News and Market Data on AZZ

28 Nov, 2023, 16:30 ET

Investor Presentation to be held at 1:00 p.m. Eastern Time

FORT WORTH, Texas, Nov. 28, 2023 /PRNewswire/ — AZZ Inc. (NYSE: AZZ) the leading independent provider of hot-dip galvanizing and coil coating solutions in North America, today announced that David Nark, Senior Vice President, Marketing, Communications, and Investor Relations, will present at the 19th Annual Noble Capital Markets Emerging Growth Equity Conference at the campus of Florida Atlantic University on Monday, December 4, 2023 at 1:00 p.m. ET. Investors interested in meeting with management may attend a breakout session scheduled immediately following the presentation or schedule a one-on-one meeting during the conference on December 4th or December 5th.

A high-definition video webcast of the presentation will be available the day following the event on the Company’s website at www.azz.com/investor-relations, on Noble Capital Markets’ Conference website at www.nobleconference.com and at www.channelchek.com the investor portal created by Noble. The webcast will be archived on each website for 90 days following the event.

AZZ’s management will host one-on-one investor meetings during the event. Investors interested in arranging one-on-one meetings should contact Amanda Weinsoff at aweinsoff@channelchek.com.

About AZZ Inc.

AZZ Inc. is the leading independent provider of hot-dip galvanizing and coil coating solutions to a broad range of end-markets. Collectively, our business segments provide sustainable, unmatched metal coating solutions that enhance the longevity and appearance of buildings, products and infrastructure that are essential to everyday life. For more information on AZZ Inc. please visit https://www.azz.com/about-us/.

Safe Harbor Statement

Certain statements herein about our expectations of future events or results constitute forward-looking statements for purposes of the safe harbor provisions of The Private Securities Litigation Reform Act of 1995. You can identify forward-looking statements by terminology such as “may,” “could,” “should,” “expects,” “plans,” “will,” “might,” “would,” “projects,” “currently,” “intends,” “outlook,” “forecasts,” “targets,” “anticipates,” “believes,” “estimates,” “predicts,” “potential,” “continue,” or the negative of these terms or other comparable terminology. Such forward-looking statements are based on currently available competitive, financial, and economic data and management’s views and assumptions regarding future events. Such forward-looking statements are inherently uncertain, and investors must recognize that actual results may differ from those expressed or implied in the forward-looking statements. Forward-looking statements speak only as of the date they are made and are subject to risks that could cause them to differ materially from actual results. Certain factors could affect the outcome of the matters described herein. This press release may contain forward-looking statements that involve risks and uncertainties including, but not limited to, changes in customer demand for our products and services, including demand by the construction markets, the industrial markets, and the metal coatings markets. We could also experience additional increases in labor costs, components and raw materials including zinc and natural gas, which are used in our hot-dip galvanizing process; supply-chain vendor delays; customer requested delays of our products or services; delays in additional acquisition opportunities; an increase in our debt leverage and/or interest rates on our debt, of which a significant portion is tied to variable interest rates; availability of experienced management and employees to implement AZZ’s growth strategy; a downturn in market conditions in any industry relating to the products we inventory or sell or the services that we provide; economic volatility, including a prolonged economic downturn or macroeconomic conditions such as inflation or changes in the political stability in the United States and other foreign markets in which we operate; acts of war or terrorism inside the United States or abroad; and other changes in economic and financial conditions. AZZ has provided additional information regarding risks associated with the business, including in Part I, Item 1A. Risk Factors, in AZZ’s Annual Report on Form 10-K for the fiscal year ended February 28, 2023, and other filings with the SEC, available for viewing on AZZ’s website at www.azz.com and on the SEC’s website at www.sec.gov. You are urged to consider these factors carefully when evaluating the forward-looking statements herein and are cautioned not to place undue reliance on such forward-looking statements, which are qualified in their entirety by this cautionary statement. These statements are based on information as of the date hereof and AZZ assumes no obligation to update any forward-looking statements, whether as a result of new information, future events, or otherwise.

Investor Relations and Company Contact:
David Nark, Senior Vice President of Marketing, Communications, and Investor Relations
AZZ Inc.
(817) 810-0095
www.azz.com

Investor Contact:
Sandy Martin / Phillip Kupper
Three Part Advisors
(214) 616-2207
www.threepa.com

SOURCE AZZ Inc.

AZZ Inc. (AZZ) – Model Adjustments


Tuesday, October 24, 2023

Michael Heim, Senior Vice President, Equity Research Analyst, Energy & Transportation, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

We have updated our models to reflect reported August quarter financial results. We are fine tuning our models to reflect August quarter results. We have raised our sales projections modestly to reflect anticipated growth in the Precoat division in the February quarter, typically the weakest quarter for the company. We now project Precoat sales and overall sales in the fourth quarter of $195 million and $345 million, respectively.

We have trimmed margins a bit. We have lowered our gross margin and EBITDA margin assumptions for the third and fourth quarter. Our margin assumptions now show improvement over previous year results, but now allow for a decrease in margins in the winter quarters relative to the summer quarters to reflect lower sales.


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Equity Research is available at no cost to Registered users of Channelchek. Not a Member? Click ‘Join’ to join the Channelchek Community. There is no cost to register, and we never collect credit card information.

This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision. 

AZZ Inc. (AZZ) – Sales a bit light, but margins are holding steady.


Thursday, October 12, 2023

Michael Heim, Senior Vice President, Equity Research Analyst, Energy & Transportation, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

Sales growth stagnated. 2024-2Q sales decreased 1.9% (Metal Coatings up 2.4% and Precoat Metals down 5.0%) due to a soft market for precoated construction and appliances. Management remains optimistic that sales growth will resume pointing to rising new home startups and the AIIJ Act.

EBITDA margins held steady despite the sale decline. Metal Coatings maintained an EBITDA margin above 30% and Precoat Metals held its EBITDA margin near 20%. Importantly, the company has been making a concerted effort to reduce customer inventories. Lower inventories has helped reduce costs and improved cash flow leaving the company well positioned for seasonal sales declines during the winter months.


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Equity Research is available at no cost to Registered users of Channelchek. Not a Member? Click ‘Join’ to join the Channelchek Community. There is no cost to register, and we never collect credit card information.

This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision. 

AZZ Inc. (AZZ) – Initiating Coverage With an Outperform Rating and $60 Price Target


Monday, August 21, 2023

Michael Heim, Senior Vice President, Equity Research Analyst, Energy & Transportation, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

AZZ Inc. is North America’s largest independent hot-dip galvanizing and coil coating solution company. AZZ has two operating divisions – Metal Coatings and Precoat Metals. Metal Coatings provides a wide range of high-quality metal finishing and coating services that protect from the destruction of metallic corrosion including galvanizing and other forms of coating and plating. Precoat Metals is engaged in the growing use of coil coated metal, often referred to as prepainted metal because the metal is painted prior to, rather than after, fabrication. 

The shares of AZZ trade at a sharp discount to other coating companies. We believe the discount also reflects a more leveraged balance sheet following recent acquisitions. Positive free cash flow will allow the company to pay down debt. As the company deleverages, we believe it will see valuation multiples rise to levels approaching peer companies.


Get the Full Report

Equity Research is available at no cost to Registered users of Channelchek. Not a Member? Click ‘Join’ to join the Channelchek Community. There is no cost to register, and we never collect credit card information.

This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision.