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In the last reported quarter, the company’s adjusted earnings topped the Zacks Consensus Estimate by 8.7% and increased 10.5% year over year. The top line also beat the consensus mark by 1% but decreased 4% from the prior year.
Acuity Brands beat earnings expectations in the trailing 16 quarters.
Trend in Estimate Revision
For the quarter to be reported, the Zacks Consensus Estimate for earnings per share has remained stable at $4.20 in the past 60 days. The estimated figure indicates an increase of 12% from the $3.75 per share reported in the year-ago quarter.
The consensus mark for revenues is pegged at $1.02 billion, suggesting 1.6% growth from the year-ago reported figure of $1 billion.
Acuity Brands’ revenues are anticipated to have decreased year over year in the fiscal third quarter due to sluggish performance in the Acuity Brands Lighting (ABL) segment. This segment faces challenges from tough year-over-year comparisons due to sales from an excess backlog last year. However, the company's emphasis on improving product vitality, boosting service levels, and leveraging technological advancements and new product innovations is expected to partially mitigate the negative impact of these challenges.
Segment-wise, for the to-be-reported quarter, our model predicts total ABL segment revenues to decline 1.6% year over year to $925.3 million. The decline across the sales channels is likely to have affected the segment’s revenues, barring Retail and Corporate Accounts sales.
Within the ABL segment, we expect Independent Sales Network, Direct Sales Network and Other revenues to decline 2.2%, 1.9% and 1.3%, respectively, year over year. Retail and Corporate Accounts sales are expected to register 3.2% and 1.4% growth, respectively, in the to-be-reported quarter.
The company has gained from its diversified portfolio of innovative lighting control solutions and energy-efficient luminaries. Its focus on Intelligent Spaces Group (ISG) products, which specialize in providing products and services that enhance the intelligence, safety and sustainability of spaces, bodes well. Our model predicts the ISG segment’s revenues in the fiscal third quarter to increase 16.3% year over year to $76.5 million.
Meanwhile, increased prices and cost containment efforts are likely to have aided margins in the to-be-reported quarter. Our model predicts the adjusted operating margin in the fiscal third quarter to grow 50 basis points year over year to 16.8%.
What Our Model Indicates
Our proven model does not conclusively predict an earnings beat for Acuity Brands this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. This is not the case here, as you will see below.
Earnings ESP: The company’s earnings ESP is 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Acuity Brands currently has a Zacks Rank #3.
Stocks With the Favorable Combination
According to our model, here are some companies in the Zacks Construction sector that have the right combination of elements to post an earnings beat in the quarter to be reported.
URI’s earnings topped the consensus mark in each of the last four quarters, the average being 6%. Earnings for the to-be-reported quarter are expected to gain 6% year over year.
RPM International Inc. (RPM - Free Report) has an Earnings ESP of +1.47% and a Zacks Rank #3.
RPM’s earnings topped the consensus mark in the trailing four quarters, the average surprise being 4.5%. Earnings for the to-be-reported quarter are expected to grow 14.7% year over year.
Louisiana-Pacific Corporation (LPX - Free Report) has an Earnings ESP of +0.50% and sports a Zacks Rank #1.
LPX’s earnings topped the consensus mark in three of the last four quarters and missed on one occasion, the average being 18.6%. Earnings for the to-be-reported quarter are expected to grow 267.3% year over year.
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Acuity Brands (AYI) to Report Q3 Earnings: Factors to Note
Acuity Brands, Inc. (AYI - Free Report) is scheduled to announce third-quarter fiscal 2024 results on Jun 27, before the opening bell.
In the last reported quarter, the company’s adjusted earnings topped the Zacks Consensus Estimate by 8.7% and increased 10.5% year over year. The top line also beat the consensus mark by 1% but decreased 4% from the prior year.
Acuity Brands beat earnings expectations in the trailing 16 quarters.
Trend in Estimate Revision
For the quarter to be reported, the Zacks Consensus Estimate for earnings per share has remained stable at $4.20 in the past 60 days. The estimated figure indicates an increase of 12% from the $3.75 per share reported in the year-ago quarter.
The consensus mark for revenues is pegged at $1.02 billion, suggesting 1.6% growth from the year-ago reported figure of $1 billion.
Acuity Brands Inc Price and EPS Surprise
Acuity Brands Inc price-eps-surprise | Acuity Brands Inc Quote
Factors to Note
Acuity Brands’ revenues are anticipated to have decreased year over year in the fiscal third quarter due to sluggish performance in the Acuity Brands Lighting (ABL) segment. This segment faces challenges from tough year-over-year comparisons due to sales from an excess backlog last year. However, the company's emphasis on improving product vitality, boosting service levels, and leveraging technological advancements and new product innovations is expected to partially mitigate the negative impact of these challenges.
Segment-wise, for the to-be-reported quarter, our model predicts total ABL segment revenues to decline 1.6% year over year to $925.3 million. The decline across the sales channels is likely to have affected the segment’s revenues, barring Retail and Corporate Accounts sales.
Within the ABL segment, we expect Independent Sales Network, Direct Sales Network and Other revenues to decline 2.2%, 1.9% and 1.3%, respectively, year over year. Retail and Corporate Accounts sales are expected to register 3.2% and 1.4% growth, respectively, in the to-be-reported quarter.
The company has gained from its diversified portfolio of innovative lighting control solutions and energy-efficient luminaries. Its focus on Intelligent Spaces Group (ISG) products, which specialize in providing products and services that enhance the intelligence, safety and sustainability of spaces, bodes well. Our model predicts the ISG segment’s revenues in the fiscal third quarter to increase 16.3% year over year to $76.5 million.
Meanwhile, increased prices and cost containment efforts are likely to have aided margins in the to-be-reported quarter. Our model predicts the adjusted operating margin in the fiscal third quarter to grow 50 basis points year over year to 16.8%.
What Our Model Indicates
Our proven model does not conclusively predict an earnings beat for Acuity Brands this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. This is not the case here, as you will see below.
Earnings ESP: The company’s earnings ESP is 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Acuity Brands currently has a Zacks Rank #3.
Stocks With the Favorable Combination
According to our model, here are some companies in the Zacks Construction sector that have the right combination of elements to post an earnings beat in the quarter to be reported.
United Rentals, Inc. (URI - Free Report) has an Earnings ESP of +0.54% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.
URI’s earnings topped the consensus mark in each of the last four quarters, the average being 6%. Earnings for the to-be-reported quarter are expected to gain 6% year over year.
RPM International Inc. (RPM - Free Report) has an Earnings ESP of +1.47% and a Zacks Rank #3.
RPM’s earnings topped the consensus mark in the trailing four quarters, the average surprise being 4.5%. Earnings for the to-be-reported quarter are expected to grow 14.7% year over year.
Louisiana-Pacific Corporation (LPX - Free Report) has an Earnings ESP of +0.50% and sports a Zacks Rank #1.
LPX’s earnings topped the consensus mark in three of the last four quarters and missed on one occasion, the average being 18.6%. Earnings for the to-be-reported quarter are expected to grow 267.3% year over year.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.