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AZZ's Divestiture of Nuclear Logistics to Aid Core Business
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AZZ Inc. (AZZ - Free Report) announced on Mar 2 that it completed the divestiture of its Nuclear Logistics LLC to Paragon Energy Solutions, LLC. The terms of the divestment were kept under wraps.
The aforementioned transaction was initially announced in February 2020. Notably, AZZ’s shares gained 1.5% yesterday, ending the trading session at $37.44.
Paragon Energy is primarily engaged in providing products and services for customers in the nuclear industry. Its offerings include reverse engineered products, supply-chain solutions, repair of I&C equipment, nuclear inventory management solutions and others.
Inside the Headlines
As noted, AZZ expects to record divestment-related charges (non-recurring and non-cash) in fiscal 2020 (ended February 2020, results not yet released). However, the impact of the charges will be partially offset by related-tax gains.
The divestment will likely help release capital and enable AZZ to invest the same in more relevant metal coating businesses. It is worth mentioning here that the company’s Metal Coatings segment accounted for 46.1% of revenues generated in the first nine months of fiscal 2020 (ended Nov 30, 2019).
Concurrent with the divestment news, the company reaffirmed its projections for fiscal 2020 and fiscal 2021 (ending February 2021). For fiscal 2020, it expects revenues of $1,020-$1,060 million and earnings per share of $2.60-$2.90.
For fiscal 2021, revenues are expected to be $970 million to $1.06 billion. Earnings per share will likely be $2.65-$3.15.
Inorganic Activities of AZZ
In addition to divestment, the company believes in making acquisitions to strengthen its business portfolio.
In September 2019, it acquired privately-owned Preferred Industries, Ltd. The latter specializes in providing e-coating and powder solutions. The products are mainly used in plastics, marine, automotive, HVAC, industrial, transportation, medical and transportation. Also, AZZ acquired NuZinc, LLC in August 2019 and K2 Partners, Inc. in April.
Zacks Rank, Estimates and Price Performance
With a market capitalization of nearly $968 million, AZZ currently carries a Zacks Rank #4 (Sell). In the past three months, the company’s shares have declined 2.3% compared with the industry’s fall of 6.2%.
In the past 60 days, earnings estimates for AZZ have moved down. The Zacks Consensus Estimate for its earnings is pegged at $2.69 for fiscal 2020 and $2.83 for fiscal 2021, suggesting declines of 3.6% and 4.7% from the respective 60-day-ago figures.
In the past 60 days, bottom-line estimates for all three companies have improved for the current year.
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AZZ's Divestiture of Nuclear Logistics to Aid Core Business
AZZ Inc. (AZZ - Free Report) announced on Mar 2 that it completed the divestiture of its Nuclear Logistics LLC to Paragon Energy Solutions, LLC. The terms of the divestment were kept under wraps.
The aforementioned transaction was initially announced in February 2020. Notably, AZZ’s shares gained 1.5% yesterday, ending the trading session at $37.44.
Paragon Energy is primarily engaged in providing products and services for customers in the nuclear industry. Its offerings include reverse engineered products, supply-chain solutions, repair of I&C equipment, nuclear inventory management solutions and others.
Inside the Headlines
As noted, AZZ expects to record divestment-related charges (non-recurring and non-cash) in fiscal 2020 (ended February 2020, results not yet released). However, the impact of the charges will be partially offset by related-tax gains.
The divestment will likely help release capital and enable AZZ to invest the same in more relevant metal coating businesses. It is worth mentioning here that the company’s Metal Coatings segment accounted for 46.1% of revenues generated in the first nine months of fiscal 2020 (ended Nov 30, 2019).
Concurrent with the divestment news, the company reaffirmed its projections for fiscal 2020 and fiscal 2021 (ending February 2021). For fiscal 2020, it expects revenues of $1,020-$1,060 million and earnings per share of $2.60-$2.90.
For fiscal 2021, revenues are expected to be $970 million to $1.06 billion. Earnings per share will likely be $2.65-$3.15.
Inorganic Activities of AZZ
In addition to divestment, the company believes in making acquisitions to strengthen its business portfolio.
In September 2019, it acquired privately-owned Preferred Industries, Ltd. The latter specializes in providing e-coating and powder solutions. The products are mainly used in plastics, marine, automotive, HVAC, industrial, transportation, medical and transportation. Also, AZZ acquired NuZinc, LLC in August 2019 and K2 Partners, Inc. in April.
Zacks Rank, Estimates and Price Performance
With a market capitalization of nearly $968 million, AZZ currently carries a Zacks Rank #4 (Sell). In the past three months, the company’s shares have declined 2.3% compared with the industry’s fall of 6.2%.
In the past 60 days, earnings estimates for AZZ have moved down. The Zacks Consensus Estimate for its earnings is pegged at $2.69 for fiscal 2020 and $2.83 for fiscal 2021, suggesting declines of 3.6% and 4.7% from the respective 60-day-ago figures.
AZZ Inc. Price and Consensus
AZZ Inc. price-consensus-chart | AZZ Inc. Quote
Stocks That Warrant a Look
Three better-ranked stocks in the industry are Emerson Electric Co. (EMR - Free Report) , Regal Beloit Corporation (RBC - Free Report) and Schneider Electric SE (SBGSY - Free Report) . All three stocks currently carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
In the past 60 days, bottom-line estimates for all three companies have improved for the current year.
Breakout Biotech Stocks with Triple-Digit Profit Potential
The biotech sector is projected to surge beyond $775 billion by 2024 as scientists develop treatments for thousands of diseases. They’re also finding ways to edit the human genome to literally erase our vulnerability to these diseases.
Zacks has just released Century of Biology: 7 Biotech Stocks to Buy Right Now to help investors profit from 7 stocks poised for outperformance. Our recent biotech recommendations have produced gains of +50%, +83% and +164% in as little as 2 months. The stocks in this report could perform even better.
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