AZZ Inc. (AZZ) – Favorable Outlook Through FY 2026; Increasing Estimates

Friday, January 03, 2025

Mark Reichman, Managing Director, Equity Research Analyst, Natural Resources, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

Corporate guidance for fiscal year 2025. Following AZZ’s strong second quarter earnings report for fiscal year 2025, the company maintained its FY 2025 sales guidance range of $1.525 billion to $1.625 billion, lifted the lower end of adjusted EBITDA to a range of $320 million to $360 million, and increased adjusted diluted EPS expectations to a range of $4.70 to $5.10. During the company’s second quarter investor conference call, management indicated that AZZ had experienced a strong start to the third quarter of fiscal year 2025. Moreover, the tone seemed to indicate that the company’s fiscal year 2025 guidance was grounded in conservative assumptions knowing that the latter half of the fiscal year is generally weaker than the first half due to seasonality. 

Updating estimates.We have increased our FY 2025 EBITDA and EPS estimates to $346.8 million and $5.05, respectively, from $344.8 million and $5.00. The revisions are driven mostly by higher third quarter margin expectations. Our estimates for FY 2026 revenue, EBITDA, and EPS have been increased to $1.675 billion, $371.5 million, and $5.70, respectively, from $1.673 billion, $367.4 million, and $5.60. We think the incoming Trump administration could support pro-growth economic policies that could favorably impact AZZ’s business.

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This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

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