TD Cowen says Acuity Brands' upbeat gross margin performance offset poor results

Acuity

05/04/2023 11:34

** Despite a revenue miss, Acuity Brands  AYI.N  exercised
prudent price/cost management in Q2 of fiscal 2023, driving
better-than-expected gross margin performance, analysts at TD
Cowen said
    ** AYI, on Tuesday, posted net sales of $943.6 mln, missing
Street estimates of $958.47 mln, and a Q2 adjusted profit of
$3.06 per share - Refinitiv IBES
    ** Q2 adj. EPS beat expectations, driven by
better-than-expected gross margin, which more than offset sales
coming in lower than consensus estimates
    ** Brokerage cuts PT to $191 from $198 and maintains an
'outperform' rating on the stock
    ** "Acuity's contractor select business continues to perform
well and is not showing any indication of a buildup in channel
inventory. Notably, management continues to expect gross margin
expansion during H2, which we see as longer term positive"
    ** Three of 10 analysts rate the stock 'buy' or higher and
seven rate it 'hold'; their median PT is $180

 (Reporting by Tejaswi Marthi in Bengaluru)
 ((tejaswi.marthi@thomsonreuters.com))