Core Insights - Zacks Premium provides tools for investors to enhance their stock market strategies, including daily updates on Zacks Rank and Style Scores [1][4] - The Zacks Style Scores categorize stocks into Value, Growth, Momentum, and VGM Scores, aiding investors in selecting stocks with the potential to outperform the market [2][3] Zacks Style Scores - **Value Score**: Focuses on identifying undervalued stocks using financial ratios like P/E and Price/Sales [2] - **Growth Score**: Evaluates a company's financial health and future growth potential through earnings and sales projections [2] - **Momentum Score**: Targets stocks with upward price trends, utilizing recent price changes and earnings estimate shifts [2] - **VGM Score**: Combines Value, Growth, and Momentum Scores to highlight stocks with the best overall potential [3] Zacks Rank - The Zacks Rank is a proprietary model based on earnings estimate revisions, with 1 (Strong Buy) stocks achieving an average annual return of +25.41% since 1988, significantly outperforming the S&P 500 [4] - Investors are encouraged to focus on stocks with a Zacks Rank of 1 or 2 and Style Scores of A or B for optimal returns [5] Company Spotlight: Acuity Brands (AYI) - Acuity Brands, headquartered in Atlanta, GA, specializes in manufacturing and distributing lighting fixtures and related components [6] - AYI holds a Zacks Rank of 3 (Hold) with a VGM Score of A and a Momentum Style Score of B, having seen a 5.4% increase in shares over the past four weeks [6][7] - Recent earnings estimates for AYI have been revised upward, with the Zacks Consensus Estimate increasing by $0.35 to $14.79 per share, and an average earnings surprise of 13.9% [6]

Core Viewpoint - Acuity Brands, Inc. is set to release its fiscal 2024 second quarter results on April 3, 2024, with a conference call led by CEO Neil Ashe [1]. Company Overview - Acuity Brands, Inc. is a market-leading industrial technology company focused on solving problems related to spaces, light, and future innovations [2]. - The company operates through two main segments: Acuity Brands Lighting and Lighting Controls (ABL) and the Intelligent Spaces Group (ISG), providing products and services that enhance people's lives [2]. - Acuity Brands aims for growth through innovative product development, including lighting, lighting controls, building management solutions, and location-aware applications [2]. - The company emphasizes customer-focused efficiencies to increase market share and deliver superior returns, with plans to aggressively deploy capital for business growth and entry into new verticals [2]. Operational Footprint - Acuity Brands is headquartered in Atlanta, Georgia, and has operations across North America, Europe, and Asia, supported by over 12,000 dedicated associates [3].

Core Insights - Zacks Premium provides tools for investors to enhance their stock market strategies, including daily updates, research reports, and stock screens [1][5] - The Zacks Style Scores categorize stocks into Value, Growth, Momentum, and a combined VGM Score, aiding investors in selecting stocks with high potential [2][3] Zacks Style Scores - **Value Score** focuses on identifying undervalued stocks using financial ratios like P/E and Price/Sales [2] - **Growth Score** evaluates a company's future growth potential through earnings and sales projections [2] - **Momentum Score** assesses stocks based on price trends and earnings estimate changes to capitalize on market movements [2] - **VGM Score** combines all three styles to provide a comprehensive rating for stocks [3] Zacks Rank - The Zacks Rank is a proprietary model that uses earnings estimate revisions to identify stocks, with 1 (Strong Buy) stocks historically yielding an average annual return of +25.41% since 1988 [4] - There are over 800 top-rated stocks available, making it essential for investors to choose wisely [4] Investment Strategy - Investors are encouraged to select stocks with a Zacks Rank of 1 or 2 and Style Scores of A or B for optimal success [5] - Stocks with lower ranks, even with good Style Scores, may still face declining earnings forecasts, increasing the risk of price drops [5] Company Spotlight: Acuity Brands (AYI) - Acuity Brands, headquartered in Atlanta, GA, specializes in manufacturing lighting fixtures and energy-efficient systems [6] - AYI holds a 1 (Strong Buy) Zacks Rank and a VGM Score of B, indicating strong investment potential [6] - The company has a forward P/E ratio of 16.55 and has seen positive earnings estimate revisions, with the consensus estimate rising by $1.40 to $14.79 per share [6]

Core Viewpoint - Acuity Brands reported strong first-quarter fiscal 2024 results, with earnings and revenues exceeding expectations, despite a decline in sales in the lighting business [2][3]. Financial Performance - Adjusted earnings per share were $3.72, surpassing the consensus estimate of $3.09 by 20.4% and increasing 13.1% from the previous year [3]. - Net sales reached $934.7 million, exceeding the consensus mark of $924.5 million by 1.1%, although this represented a 6.3% decline year-over-year due to lower volumes [3]. Segment Performance - Acuity Brands Lighting and Lighting Controls (ABL) saw net sales decline 7.5% year-over-year to $876.4 million, while the Independent Sales Network and Direct Sales Network also experienced declines [4]. - Retail sales increased by 11.4% to $55.6 million, contrasting with a 15.5% decline in Corporate Accounts sales [4]. - The Intelligent Spaces Group (ISG) generated net sales of $64.2 million, up 13% year-over-year, although adjusted operating profit decreased by 2.7% [5]. Operating Highlights - Adjusted operating profit increased by 9.9% to $153.9 million, with an adjusted operating margin of 16.5%, up 250 basis points year-over-year [6]. Financial Position - At the end of the fiscal first quarter, cash and cash equivalents were $513.3 million, up from $397.9 million at the end of fiscal 2023, while long-term debt remained stable at $495.7 million [7]. - Cash provided by operating activities totaled $190 million, an increase from $186.6 million in the prior-year period, with free cash flow rising 4.2% to $175.4 million [7]. Fiscal 2024 Outlook - For fiscal 2024, Acuity Brands expects net sales between $3.7 billion and $4 billion, compared to $3.95 billion reported in fiscal 2023, with adjusted earnings per share projected between $13 and $14.50 [8]. - Consensus estimates have trended upward, with a 6% shift due to recent changes [8]. Investment Sentiment - Acuity Brands holds a strong Growth Score of A, but a C on the Momentum Score, resulting in an aggregate VGM Score of A [9]. - The stock has a Zacks Rank 1 (Strong Buy), indicating expectations for above-average returns in the coming months [10].

Core Insights - Zacks Premium provides tools for investors to enhance their stock market engagement and confidence through various research services [1] - The Zacks Style Scores are designed to help investors identify stocks with the highest potential to outperform the market in the short term [1] Zacks Style Scores Overview - Each stock is rated from A to F based on value, growth, and momentum characteristics, with A being the highest score [2] - The Value Score focuses on identifying undervalued stocks using financial ratios like P/E and Price/Sales [2] - The Growth Score assesses a company's financial health and future outlook based on earnings and sales projections [2] - The Momentum Score capitalizes on price trends and earnings estimate changes to identify favorable investment opportunities [3] - The VGM Score combines the three Style Scores to highlight stocks with attractive value, growth potential, and momentum [4] Zacks Rank and Style Scores Integration - The Zacks Rank utilizes earnings estimate revisions to simplify portfolio building, with 1 (Strong Buy) stocks achieving an average annual return of +25.41% since 1988 [5] - Investors are encouraged to select stocks with a Zacks Rank of 1 or 2 and Style Scores of A or B for optimal success [6] Company Spotlight: Acuity Brands (AYI) - Acuity Brands, Inc. is a leading manufacturer of lighting fixtures and related components, focusing on energy efficiency and comfort [7] - AYI holds a 1 (Strong Buy) rating on the Zacks Rank and has a VGM Score of A, indicating strong growth potential [7] - The company is projected to achieve a year-over-year earnings growth of 5.3% for the current fiscal year, supported by a Growth Style Score of A [8] - Recent analyst revisions have increased AYI's earnings estimate for fiscal 2024 by $1.40 to $14.79 per share, with an average earnings surprise of 13.9% [8]

Core Viewpoint - Acuity Brands, Inc. (AYI) has increased its quarterly cash dividend by 15.4%, reflecting improved cash flow and effective capital allocation strategies [1][2]. Financial Performance - AYI's board approved a quarterly dividend payout of 15 cents per share, up from 13 cents per share, resulting in an annual payout of 60 cents per share [1]. - The company reported adjusted earnings of $3.72 per share for the first quarter of fiscal 2024, exceeding the Zacks Consensus Estimate by 20.4% and growing 13.1% year over year [2]. - Cash flow from operations increased by 1.6% to $190 million, driven by improved net income [3]. - For fiscal 2024, AYI expects net sales to be between $3.7 billion and $4 billion, compared to $3.95 billion in fiscal 2023 [3]. Market Performance - AYI's shares have surged 50.2% over the past three months, outperforming the Zacks Building Products - Lighting industry's growth of 44.3% [3]. - The fiscal 2024 earnings estimates for AYI have been revised upward to $14.79 per share from $14.44 per share in the past week [4]. - AYI has delivered an average trailing four-quarter earnings surprise of 13.9% [4].

Economic Overview - The U.S. economy has demonstrated significant strength in 2023, highlighted by the S&P 500 Index reaching an all-time high, with 12 out of 13 weeks showing positive performance [1] - The Federal Reserve's decision to halt interest rate hikes in July 2023 contributed to a 23.9% rally in the S&P 500 Index last year [1] - An anticipated interest rate reduction by the Fed in 2024 is expected to positively impact stock markets, as lower risk-free rates will decrease discount rates, enhancing the net present value of equity investments [1] Investment Strategy - Investors are focusing on relative price performance to identify stocks with potential for accelerated returns [2] - A stock's potential for considerable returns is primarily assessed through its earnings and valuation ratios, alongside its performance relative to peers or industry averages [3] - Stocks that outperform their respective industries or benchmarks should be prioritized for inclusion in investment portfolios [3] Stock Screening Parameters - Stocks must show a relative price change greater than 0 over the last 12 weeks, 4 weeks, and 1 week to be considered for investment [5] - Positive current-quarter estimate revisions over the last four weeks are also a criterion for selection [5] - Only stocks with a Zacks Rank of 1 (Strong Buy) are included, which have historically outperformed the S&P 500 [5] Selected Stocks - **AZZ Inc. (AZZ)**: Expected EPS growth rate of 14% over three to five years, with a market cap of $1.6 billion and a 50.7% increase in share price over the past year [6] - **Universal Technical Institute, Inc. (UTI)**: Anticipated EPS growth of 376.9% year-over-year, with shares rising 104.4% in a year [7] - **Acuity Brands, Inc. (AYI)**: Expected EPS growth of 5.3% year-over-year, with a 29.2% increase in share price over the past year [8] - **PACCAR Inc. (PCAR)**: Anticipated EPS growth of 6.6% year-over-year, with shares increasing by 40.3% in a year [8] - **The Progressive Corporation (PGR)**: Expected EPS growth of 40.3% year-over-year, with a 32.5% increase in share price over the past year [9]

Group 1 - Acuity Brands, Inc (AYI) is positioned well in the Building Products - Lighting industry, which has a Zacks Industry Rank of 12 out of over 250 industries, indicating strong overall performance [1][2] - The company has experienced positive earnings estimate revisions, with current quarter estimates increasing from $2.97 to $3.11 per share and current year estimates rising from $13.39 to $14.44 per share [2] - AYI has achieved a Zacks Rank 1 (Strong Buy), reflecting analysts' growing bullish sentiment regarding the company's short and long-term prospects [2] Group 2 - The Building Products - Lighting industry is benefiting from broad trends that are positively impacting securities across the sector, suggesting a favorable environment for investments [1] - Acuity Brands is highlighted as a strong pick within this robust industry, making it an attractive option for investors seeking opportunities in this segment [2]

Core Viewpoint - Acuity Brands (AYI) has shown strong stock performance, with a 13.9% increase over the past month and reaching a new 52-week high of $231.16, outperforming both the Zacks Construction sector and the Zacks Building Products - Lighting industry [1] Financial Performance - Acuity Brands has consistently exceeded earnings expectations, reporting an EPS of $3.72 against a consensus estimate of $3.09 in its last earnings report on January 9, 2024, and beating revenue estimates by 1.11% [2] - For the current fiscal year, the company is projected to achieve earnings of $14.91 per share on revenues of $3.85 billion, reflecting a 6.12% increase in EPS and a -2.52% decrease in revenues [2] - The next fiscal year forecasts earnings of $16.09 per share on $4.02 billion in revenues, indicating a year-over-year change of 7.91% in EPS and 4.47% in revenues [2] Valuation Metrics - Acuity Brands trades at 15.5X current fiscal year EPS estimates, below the peer industry average of 20.3X, and at 14X on a trailing cash flow basis compared to the peer group's average of 12.4X [4] - The stock has a PEG ratio of 1.55, which does not place it among the top tier of stocks from a value perspective [4] Zacks Rank - Acuity Brands holds a Zacks Rank of 1 (Strong Buy) due to favorable earnings estimate revisions from analysts, indicating strong potential for future performance [5] - The company meets the criteria for investment selection with a Zacks Rank of 1 or 2 and Style Scores of A or B, suggesting positive outlook for the coming weeks and months [5]

Group 1 - Potbelly (PBPB) has seen a 15.4% increase in the Zacks Consensus Estimate for its current year earnings over the last 60 days [1] - Acuity Brands (AYI) has experienced a 10.4% increase in the Zacks Consensus Estimate for its current year earnings over the last 60 days [1] - Holley (HLLY) has recorded a 4.8% increase in the Zacks Consensus Estimate for its current year earnings over the last 60 days [1] Group 2 - Komatsu (KMTUY) has seen a 4.0% increase in the Zacks Consensus Estimate for its current year earnings over the last 60 days [2] - Vertiv (VRT) has experienced a 1.2% increase in the Zacks Consensus Estimate for its current year earnings over the last 60 days [2]