The 10-second takeaway
For the quarter ended Feb. 29 (Q4), AZZ beat slightly on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue expanded significantly and GAAP earnings per share grew significantly.
Gross margins shrank, operating margins contracted, net margins improved.
AZZ reported revenue of $123.6 million. The four analysts polled by S&P Capital IQ expected to see revenue of $121.4 million on the same basis. GAAP reported sales were 23% higher than the prior-year quarter's $100.7 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.92. The four earnings estimates compiled by S&P Capital IQ predicted $0.82 per share. GAAP EPS of $0.92 for Q4 were 26% higher than the prior-year quarter's $0.73 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 26.2%, 100 basis points worse than the prior-year quarter. Operating margin was 15.8%, 30 basis points worse than the prior-year quarter. Net margin was 9.4%, 20 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $123.5 million. On the bottom line, the average EPS estimate is $0.83.
Next year's average estimate for revenue is $503.2 million. The average EPS estimate is $3.61.
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 775 members out of 792 rating the stock outperform, and 17 members rating it underperform. Among 200 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 198 give AZZ a green thumbs-up, and two give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on AZZ is outperform, with an average price target of $63.00.
Over the decades, small-cap stocks, like AZZ have provided market-beating returns, provided they're value priced and have solid businesses. Read about a pair of companies with a lock on their markets in "Too Small to Fail: Two Small Caps the Government Won't Let Go Broke." Click here for instant access to this free report.
- Add AZZ to My Watchlist.
Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool owns shares of AZZ. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.