Investors looking for stocks in the Technology Services sector might want to consider either Acuity (AYI) or SPX Technologies (SPXC) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.The best way to find great value stocks is to pair a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight sto ...

It has been about a month since the last earnings report for Acuity (AYI) . Shares have added about 1.1% in that time frame, underperforming the S&P 500.Will the recent positive trend continue leading up to its next earnings release, or is Acuity due for a pullback? Well, first let's take a quick look at its latest earnings report in order to get a better handle on the recent catalysts for Acuity, Inc. before we dive into how investors and analysts have reacted as of late.Acuity Brands' Q4 Earnings Topping ...

Competitive Risks - The company faces risks from aggressive pricing actions by competitors, which may affect revenue growth and profitability levels[33]. - The company competes in a rapidly evolving technological landscape, where new competitors may offer integrated solutions that challenge existing offerings[43]. - Relationships with channel partners are crucial, and the loss of significant partners could harm business operations[44]. Product and Innovation Risks - New product innovations may not yield desired returns, potentially leading to inventory write-downs and impacting overall business performance[34]. - The company has begun incorporating AI capabilities into its product offerings, which may pose risks related to accuracy, bias, and legal liability[69]. - Product recalls due to design or manufacturing issues could result in substantial costs, including lost sales and penalties[77][78]. Supply Chain and Operational Risks - Supply chain disruptions, particularly for components like microchips, have resulted in increased costs and may affect timely procurement of materials[39]. - The company relies on third-party relationships for various operations, which introduces risks related to product quality and operational interruptions[59]. - The company operates seven manufacturing facilities in Mexico, some of which hold Maquiladora status, allowing duty-free import of raw materials[62]. Geopolitical and Economic Risks - The company is exposed to geopolitical risks, with approximately 55% of finished products manufactured in Mexico, which could disrupt supply chains[45]. - Economic conditions, including potential recessions and rising commodity costs, may adversely affect cash flows and access to capital[38]. - The company is subject to various international regulations, including the USMCA, which affects a significant portion of its sales[63]. Labor and Workforce Risks - The company employed approximately 13,800 people as of August 31, 2025, with about 9,300 in international locations[56]. - Approximately 58% of the workforce is covered by union recognition and collective bargaining agreements, with 48% of these agreements set to expire within one year[56]. - The company faces intense competition for qualified personnel, which may impact its ability to attract and retain key employees amid rising labor costs and shortages[57]. Financial and Currency Risks - The company is exposed to foreign currency fluctuations, which could impact pricing competitiveness and overall financial performance[66]. - A hypothetical 10% depreciation of the Canadian dollar could negatively impact operating profit by approximately $3.0 million, while a 10% appreciation could favorably impact it by approximately $3.7 million[186]. - A 10% decrease in the value of the Mexican peso could favorably impact operating profit by approximately $23.0 million, whereas a 10% increase could negatively impact it by approximately $28.1 million[186]. - The company has a significant exposure to variable-rate debt, with $400.0 million borrowings outstanding on its credit facility[185]. Regulatory and Compliance Risks - The company is subject to a range of environmental regulations, including those related to greenhouse gas emissions, which may increase operational costs[71]. - The company may face challenges in complying with evolving ESG standards, which could affect its reputation and financial performance[74]. - The company is subject to evolving laws and regulations regarding ESG disclosures, which may increase operational costs and impact future financial conditions[75][84]. Legal and Reputational Risks - Legal claims arising from normal business operations may exceed insurance coverage, potentially leading to significant financial liabilities[76]. - The company may incur significant costs and reputational damage from security breaches affecting personal and proprietary information[52]. - The company may face reputational damage and adverse financial impacts if it fails to meet evolving stakeholder ESG expectations[84]. - Cybersecurity risks are increasing, with potential impacts on operations and financial reporting due to sophisticated cyber threats[49]. Climate and Sustainability Risks - The company faces risks related to climate change and sustainability, which may lead to increased operational costs and regulatory compliance burdens[81][82].

Core Insights - Acuity (AYI) is currently viewed as a more attractive investment option compared to Duolingo, Inc. (DUOL) for value investors seeking undervalued stocks [1] Valuation Metrics - AYI has a forward P/E ratio of 18.52, significantly lower than DUOL's forward P/E of 107.94, indicating that AYI is more reasonably priced relative to its earnings [5] - AYI's PEG ratio stands at 1.85, while DUOL's PEG ratio is higher at 2.25, suggesting AYI offers better value when considering expected earnings growth [5] - AYI's P/B ratio is 4.12, compared to DUOL's P/B of 15.98, further highlighting AYI's relative undervaluation [6] Earnings Outlook - AYI is experiencing an improving earnings outlook, which contributes to its strong Zacks Rank of 1 (Strong Buy), while DUOL holds a Zacks Rank of 2 (Buy) [3][7]

Industry Overview - The Technology Services industry ranks within the top 24% of Zacks Ranked Industries and is expected to outperform the market over the next three to six months, having rallied 32.9% year to date [1] - The industry is mature with strong demand for services, and this momentum is likely to continue into the fourth quarter of 2025 [1][3] Market Trends - The global shift toward digitization is creating opportunities in markets such as 5G, blockchain, and artificial intelligence (AI) [3] - Companies are rapidly adopting generative AI, machine learning (ML), blockchain, and data science to gain competitive advantages [3] - There is robust demand for multi-cloud-enabled software solutions as businesses transition from legacy platforms to modern cloud-based infrastructure [3] Company Highlights AppLovin Corp. (APP) - AppLovin is a leading technology platform for mobile app developers, enhancing marketing and monetization efforts [7][8] - The Axon 2.0 AI engine has significantly boosted ad performance, leading to a $10 billion annual run rate in ad spend [9] - AppLovin targets a 20-30% year-over-year growth rate, primarily driven by its gaming segment and AI-driven ad monetization [11] - Expected revenue and earnings growth rates for the current quarter are 15.2% and 63.6%, respectively [12] Skillsoft Corp. (SKIL) - Skillsoft provides digital learning and talent solutions, focusing on a learner-centric approach [13] - Expected revenue and earnings growth rates for the next quarter are -2% and -53.1%, respectively, but earnings estimates have improved over 100% in the last 30 days [14] Acuity Inc. (AYI) - Acuity manufactures lighting fixtures and related components, with a focus on energy efficiency and smart building solutions [15][17] - Expected revenue and earnings growth rates for the current quarter are 19.5% and 12.3%, respectively [17] Byrna Technologies Inc. (BYRN) - Byrna develops non-lethal technology products for personal and professional security [18] - Expected revenue and earnings growth rates for the current quarter are 21.3% and -23.5%, respectively [19] MediaAlpha Inc. (MAX) - MediaAlpha specializes in programmatic technology platforms for vertical search and metasearch [20] - Expected revenue and earnings growth rates for the current quarter are -8.1% and over 100%, respectively [20]

Core Insights - Momentum investing focuses on following a stock's recent price trends, aiming to buy high and sell higher as stocks tend to continue in their established direction [1][2] - Acuity (AYI) currently holds a Momentum Style Score of B, indicating a favorable position in momentum investing [3][12] Company Performance - AYI shares have increased by 0.58% over the past week, while the Zacks Technology Services industry has declined by 2.09% during the same period [6] - Over the last month, AYI's price change is 4.93%, slightly lower than the industry's performance of 4.96% [6] - In the past quarter, AYI shares have risen by 17.66%, and over the last year, they are up 19.5%, compared to the S&P 500's increases of 8.19% and 19.01%, respectively [7] Trading Volume - AYI's average 20-day trading volume is 341,222 shares, which serves as a baseline for price-to-volume analysis [8] Earnings Outlook - In the last two months, two earnings estimates for AYI have been revised upwards, with no downward revisions, leading to an increase in the consensus estimate from $19.02 to $19.08 [10] - For the next fiscal year, two estimates have also moved upwards without any downward revisions [10] Conclusion - Given the positive momentum indicators and earnings outlook, AYI is rated as a 2 (Buy) stock with a Momentum Score of B, making it a potential candidate for near-term investment [12]

Core Insights - Acuity Inc. reported better-than-expected fourth-quarter earnings with an adjusted EPS of $5.20, surpassing the analyst consensus estimate of $4.84 [1] - The company achieved quarterly net sales growth of 17.1% year-over-year, totaling $1.21 billion, slightly below the analyst consensus estimate of $1.23 billion [1][2] Financial Performance - The fiscal 2025 fourth quarter performance was characterized by growth in net sales, expansion of adjusted operating profit, and an increase in adjusted diluted earnings per share, as stated by the CEO Neil Ashe [2] - Despite strong performance metrics, Acuity shares fell by 0.6% to $360.70 following the earnings announcement [2] Analyst Ratings and Price Targets - Oppenheimer analyst Christopher Glynn maintained an Outperform rating and raised the price target from $380 to $435 [7] - TD Cowen analyst Jeffrey Osborne maintained a Buy rating and increased the price target from $330 to $390 [7] - Wells Fargo analyst Joseph O'Dea maintained an Overweight rating and raised the price target from $380 to $405 [7] - Goldman Sachs analyst Brian Lee maintained a Neutral rating and increased the price target from $312 to $356 [7] - Morgan Stanley analyst Christopher Snyder maintained an Overweight rating and raised the price target from $365 to $425 [7]

Core Insights - Acuity Brands, Inc. is recognized for its innovative lighting and building management solutions, enhancing energy efficiency and sustainability [1] - Cowen & Co. upgraded AYI's stock to "Buy," reflecting confidence in the company's future performance [1][6] Financial Performance - Acuity reported a 17.1% increase in revenue for the fourth quarter, attributed to the acquisition of QSC [2][6] - The company projects 2026 revenue between $4.7 billion and $4.9 billion, with adjusted earnings per share (EPS) expected to range from $19 to $20.50 [3][6] Market Position - Cowen & Co. raised Acuity's price target from $330 to $390, indicating a positive outlook for the stock [3][6] - Acuity's current stock price is $357.81, reflecting a decrease of 1.43% or $5.19 [4] Stock Volatility - The stock has experienced fluctuations, with a daily low of $356.24 and a high of $369.48 [4] - Over the past year, AYI reached a high of $375.67 and a low of $216.81, indicating market dynamics and investor sentiment [4] Market Capitalization - Acuity's market capitalization is approximately $10.97 billion, with a trading volume of 103,173 shares on the NYSE [5] - The stock trades at fair value multiples compared to its peers, attracting investor interest despite not being considered a bargain [5]

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Core Insights - Acuity Brands, Inc. reported strong financial performance with an EPS of $5.20, exceeding estimates of $4.70, and revenue of approximately $1.21 billion, surpassing the estimated $1.14 billion [1][6] Financial Performance - In Q4 of fiscal 2025, Acuity achieved net sales of $1.2 billion, reflecting a 17% increase year-over-year, while reported diluted EPS declined by 4% to $3.61, but adjusted diluted EPS rose by 21% to $5.20 [2][6] - For the full fiscal year 2025, net sales reached $4.3 billion, a 13% increase from the previous year, with reported diluted EPS at $12.53, down 7%, and adjusted diluted EPS increasing by 16% to $18.01 [3][6] Financial Health - The company reported cash flow from operations of $601 million during fiscal 2025, indicating strong operational efficiency [4][6] - Acuity's debt-to-equity ratio stands at 0.42, suggesting a moderate level of debt, while the current ratio is approximately 1.99, indicating strong liquidity with nearly twice as many current assets as current liabilities [5][6]