AZZ (NYSE:AZZ) Shares Gap Down Following Weak Earnings

Key Points

• AZZ Inc. (NYSE:AZZ) shares fell significantly, opening at $94.27 after previously closing at $105.94, following the announcement of weaker than expected quarterly earnings, which missed consensus estimates.
• The company reported earnings of $1.55 per share, slightly below the expected $1.56, alongside revenue of $417.28 million, which was also lower than analysts' predictions of $428.14 million.
• AZZ recently announced a quarterly dividend of $0.20 per share, reflecting a 0.8% yield, with a payout ratio of 9.27%, scheduled to be paid on November 6th.

Shares of AZZ Inc. (NYSE:AZZ - Get Free Report) gapped down prior to trading on Thursday after the company announced weaker than expected quarterly earnings. The stock had previously closed at $105.94, but opened at $94.27. AZZ shares last traded at $99.03, with a volume of 194,598 shares trading hands.

The industrial products company reported $1.55 earnings per share (EPS) for the quarter, missing the consensus estimate of $1.56 by ($0.01). AZZ had a return on equity of 15.54% and a net margin of 16.40%.The company had revenue of $417.28 million during the quarter, compared to analysts' expectations of $428.14 million. During the same quarter last year, the firm posted $1.37 earnings per share. The firm's revenue was up 2.0% on a year-over-year basis.

AZZ Dividend Announcement

The business also recently announced a quarterly dividend, which will be paid on Thursday, November 6th. Investors of record on Thursday, October 16th will be given a $0.20 dividend. The ex-dividend date is Thursday, October 16th. This represents a $0.80 annualized dividend and a yield of 0.8%. AZZ's payout ratio is 9.27%.

Wall Street Analysts Forecast Growth

Several research firms have weighed in on AZZ. B. Riley boosted their price target on shares of AZZ from $131.00 to $140.00 and gave the stock a "buy" rating in a research note on Wednesday, September 17th. Robert W. Baird boosted their price target on shares of AZZ from $110.00 to $120.00 and gave the stock a "neutral" rating in a research note on Friday, August 15th. Zacks Research downgraded shares of AZZ from a "strong-buy" rating to a "hold" rating in a research note on Monday, August 18th. Evercore ISI boosted their price target on shares of AZZ from $90.00 to $108.00 and gave the stock an "outperform" rating in a research note on Wednesday, July 9th. Finally, Noble Financial reissued an "outperform" rating on shares of AZZ in a research note on Monday, July 14th. Three research analysts have rated the stock with a Strong Buy rating, five have given a Buy rating and three have issued a Hold rating to the company's stock. Based on data from MarketBeat, the stock currently has a consensus rating of "Buy" and a consensus target price of $116.43.

Insider Activity at AZZ

In related news, CEO Thomas E. Ferguson sold 26,516 shares of the business's stock in a transaction dated Tuesday, July 22nd. The shares were sold at an average price of $110.85, for a total transaction of $2,939,298.60. Following the transaction, the chief executive officer owned 183,182 shares in the company, valued at $20,305,724.70. The trade was a 12.64% decrease in their ownership of the stock. The sale was disclosed in a filing with the Securities & Exchange Commission, which is available through this hyperlink. Also, insider Kurt L. Russell sold 10,321 shares of the business's stock in a transaction dated Tuesday, August 12th. The shares were sold at an average price of $112.21, for a total transaction of $1,158,119.41. Following the transaction, the insider owned 16,804 shares in the company, valued at $1,885,576.84. This represents a 38.05% decrease in their position. The disclosure for this sale can be found here. Insiders have sold 46,837 shares of company stock worth $5,195,318 over the last 90 days. 1.77% of the stock is owned by company insiders.

Hedge Funds Weigh In On AZZ

Several hedge funds and other institutional investors have recently modified their holdings of the stock. GAMMA Investing LLC increased its position in shares of AZZ by 39.6% during the second quarter. GAMMA Investing LLC now owns 374 shares of the industrial products company's stock valued at $35,000 after buying an additional 106 shares during the period. Hsbc Holdings PLC increased its position in shares of AZZ by 2.8% during the first quarter. Hsbc Holdings PLC now owns 4,220 shares of the industrial products company's stock valued at $353,000 after buying an additional 113 shares during the period. Cerity Partners LLC increased its position in shares of AZZ by 4.2% during the first quarter. Cerity Partners LLC now owns 3,606 shares of the industrial products company's stock valued at $302,000 after buying an additional 146 shares during the period. Teacher Retirement System of Texas increased its position in shares of AZZ by 3.9% during the second quarter. Teacher Retirement System of Texas now owns 4,311 shares of the industrial products company's stock valued at $407,000 after buying an additional 161 shares during the period. Finally, Oliver Luxxe Assets LLC grew its holdings in AZZ by 1.0% in the first quarter. Oliver Luxxe Assets LLC now owns 17,528 shares of the industrial products company's stock worth $1,466,000 after purchasing an additional 176 shares during the period. Hedge funds and other institutional investors own 90.93% of the company's stock.

AZZ Trading Down 5.1%

The firm has a market cap of $3.02 billion, a PE ratio of 11.69 and a beta of 1.30. The company has a quick ratio of 1.10, a current ratio of 1.51 and a debt-to-equity ratio of 0.47. The stock's fifty day simple moving average is $112.38 and its two-hundred day simple moving average is $99.04.

AZZ Company Profile

AZZ Inc provides hot-dip galvanizing and coil coating solutions in North America. It offers metal finishing solutions for corrosion protection, including hot-dip galvanizing, spin galvanizing, powder coating, anodizing, and plating to steel fabrication and other industries, as well as to fabricators or manufacturers that provide services to the transmission and distribution, bridge and highway, petrochemical, and general industrial markets; and original equipment manufacturers.

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