Core Insights - Acuity reported a strong start to fiscal 2026 with significant sales growth, expanding profitability, and higher adjusted earnings per share despite a tepid lighting market environment [2][6] Quarterly Results and Margin Expansion - Total net sales reached $1.1 billion, an increase of $192 million, or 20%, year-over-year, driven by growth in both business segments and including three months of QSC sales [3] - Adjusted operating profit rose to $196 million, up $38 million, or 24%, compared to the previous year, with an adjusted operating profit margin expanding to 17.2%, an increase of 50 basis points [3][6] - Adjusted diluted earnings per share increased to $4.69, up $0.72, or 18%, year-over-year [3][6] Segment Performance - In the Acuity Brands Lighting (ABL) segment, sales were $895 million, up $9 million, or 1%, primarily due to growth in the independent sales network and influenced by elevated backlog from accelerated orders ahead of price increases [4] - ABL adjusted operating profit increased by $6 million to $160 million, attributed to efforts to lower operating expenses, with an adjusted operating profit margin of 17.9%, up 60 basis points from the prior year [5] Overall Performance and Outlook - Acuity's total net sales rose approximately 20% to $1.1 billion, with adjusted operating profit increasing to $196 million and adjusted diluted EPS climbing to $4.69, alongside overall margin expansion of 50 basis points [6] - The lighting segment remained nearly flat at $895 million (+1%), while Acuity Intelligence Spaces surged to $257 million, up $184 million, driven by three months of QSC contribution and higher AIS margins of 22% [6] - Operating cash flow was $141 million, with the company repurchasing approximately $28 million of stock and repaying $100 million on the QSC term loan, totaling $300 million of $600 million repaid, while management described the lighting market as tepid and noted that backlog is normalizing [6]

Core Viewpoint - UBS upgraded Expeditors International from Neutral to Buy, raising the price target to $166 due to productivity improvements and revenue resilience despite lower ocean freight rates [1] Group 1: Financial Projections - UBS increased its 2027 EPS estimate for Expeditors to $6.90 per share from $6.58, which is above the consensus of $6.39, reflecting initial efficiency benefits [2] - Analysts modeled a 4% rebound in net revenue for Expeditors [2] Group 2: Valuation Insights - At 24x projected earnings, Expeditors' current valuation implies roughly $950 million in EBIT for 2027, compared to UBS's forecast of $1.13 billion, indicating the stock is undervalued [3] - Investor sentiment remains cautious due to weak ocean pricing, with most analysts maintaining Neutral or Sell ratings [3] Group 3: Long-term Potential - UBS highlighted the long-term potential for Expeditors to achieve significant productivity gains through technology integration and process optimization [1]