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Acuity Brands (AYI) to Post Q1 Earnings: What's in Store?
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Acuity Brands, Inc. (AYI - Free Report) is slated to announce first-quarter fiscal 2021 results on Jan 7, before the opening bell.
In the last reported quarter, its adjusted earnings and revenues topped the Zacks Consensus Estimate by 19.9% and 9.4%, respectively. However, the top and bottom lines declined 14.5% and 5%, respectively, from the prior-year quarter. The downside was caused by a 4% decline in volumes, mainly due to lower demand owing to the COVID-19 pandemic, partially offset by 3% contribution from acquisitions. Sales were impacted by 4% net unfavorable change in product prices and mix of products sold.
Markedly, the company beat earnings expectations in two of the last four quarters, with the average surprise being 16.6%.
Trend in Estimate Revision
For the quarter to be reported, the Zacks Consensus Estimate for earnings per share has been upwardly revised to $1.82 from $1.81 over the past 30 days. The estimated figure indicates a decrease of 14.6% from $2.13 per share reported in the year-ago quarter. The consensus mark for revenues is pegged at $789.4 million, suggesting a 5.4% decrease from the year-ago reported figure of $834.7 million.
Acuity Brands’ fiscal first-quarter earnings are likely to have registered a year-over-year decline due to general economic slowdown owing to the COVID-19 outbreak and soft lighting industry. Despite undertaking certain cost-saving actions, innovative lighting control solutions and energy-efficient luminaries, the overall industry has been grappling with weak demand for luminaries in the United States.
From a channel perspective, net sales through the company’s independent sales network (which accounts for 72% of total net sales) are expected to have witnessed lower demand due to the COVID-19 pandemic and partly due to unfavorable pricing. Again, net sales through the direct sales network are anticipated to have been primarily impacted by weakness in large projects that have been postponed due to the virus outbreak and some big projects in the year-ago period that did not repeat this year.
Meanwhile, the retail channel is likely to have witnessed higher year-over-year shipments owing to increased demand, primarily for residential type projects. Also, growth in several core products in this channel due to enhancements in the product portfolio and increased demand owing to more do-it-yourself projects (as more people were at home and had the benefit of stimulus checks) are likely to have partly offset the negatives in the retail channel.
Again, net sales in its corporate accounts channel are likely to have declined, mainly due to the impact of the COVID-19 pandemic on retail customers. These customers delayed many retrofit opportunities as they limited their activity in the stores.
Overall, higher contributions from acquisitions and a favorable sales channel mix are expected to have been partly offset by decline in volume and lower pricing. Also, weakness in non-residential building activity on uncertainties related to economic recovery persists.
What the Zacks Model Says
Our proven model predicts 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.
Earnings ESP: Acuity Brands has an Earnings ESP of +3.18%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
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Acuity Brands (AYI) to Post Q1 Earnings: What's in Store?
Acuity Brands, Inc. (AYI - Free Report) is slated to announce first-quarter fiscal 2021 results on Jan 7, before the opening bell.
In the last reported quarter, its adjusted earnings and revenues topped the Zacks Consensus Estimate by 19.9% and 9.4%, respectively. However, the top and bottom lines declined 14.5% and 5%, respectively, from the prior-year quarter. The downside was caused by a 4% decline in volumes, mainly due to lower demand owing to the COVID-19 pandemic, partially offset by 3% contribution from acquisitions. Sales were impacted by 4% net unfavorable change in product prices and mix of products sold.
Markedly, the company beat earnings expectations in two of the last four quarters, with the average surprise being 16.6%.
Trend in Estimate Revision
For the quarter to be reported, the Zacks Consensus Estimate for earnings per share has been upwardly revised to $1.82 from $1.81 over the past 30 days. The estimated figure indicates a decrease of 14.6% from $2.13 per share reported in the year-ago quarter. The consensus mark for revenues is pegged at $789.4 million, suggesting a 5.4% decrease from the year-ago reported figure of $834.7 million.
Acuity Brands Inc Price and EPS Surprise
Acuity Brands Inc price-eps-surprise | Acuity Brands Inc Quote
Factors to Note
Acuity Brands’ fiscal first-quarter earnings are likely to have registered a year-over-year decline due to general economic slowdown owing to the COVID-19 outbreak and soft lighting industry. Despite undertaking certain cost-saving actions, innovative lighting control solutions and energy-efficient luminaries, the overall industry has been grappling with weak demand for luminaries in the United States.
From a channel perspective, net sales through the company’s independent sales network (which accounts for 72% of total net sales) are expected to have witnessed lower demand due to the COVID-19 pandemic and partly due to unfavorable pricing. Again, net sales through the direct sales network are anticipated to have been primarily impacted by weakness in large projects that have been postponed due to the virus outbreak and some big projects in the year-ago period that did not repeat this year.
Meanwhile, the retail channel is likely to have witnessed higher year-over-year shipments owing to increased demand, primarily for residential type projects. Also, growth in several core products in this channel due to enhancements in the product portfolio and increased demand owing to more do-it-yourself projects (as more people were at home and had the benefit of stimulus checks) are likely to have partly offset the negatives in the retail channel.
Again, net sales in its corporate accounts channel are likely to have declined, mainly due to the impact of the COVID-19 pandemic on retail customers. These customers delayed many retrofit opportunities as they limited their activity in the stores.
Overall, higher contributions from acquisitions and a favorable sales channel mix are expected to have been partly offset by decline in volume and lower pricing. Also, weakness in non-residential building activity on uncertainties related to economic recovery persists.
What the Zacks Model Says
Our proven model predicts 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.
Earnings ESP: Acuity Brands has an Earnings ESP of +3.18%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Acuity Brands — which shares space with Energy Focus, Inc. (EFOI - Free Report) , Orion Energy Systems, Inc. (OESX - Free Report) and LSI Industries Inc. (LYTS - Free Report) in the Zacks Building Products – Lighting industry — currently carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
5 Stocks Set to Double
Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
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