AZEK CO INC/THE (AZEK) Stock Fundamental Analysis
NYSE:AZEK - New York Stock Exchange, Inc. - US05478C1053 - Common Stock - Currency: USD
Overall AZEK gets a fundamental rating of 5 out of 10. We evaluated AZEK against 40 industry peers in the Building Products industry. Both the profitability and the financial health of AZEK get a neutral evaluation. Nothing too spectacular is happening here. While showing a medium growth rate, AZEK is valued expensive at the moment.
1. Profitability
1.1 Basic Checks
AZEK had positive earnings in the past year.
In the past year AZEK had a positive cash flow from operations.
Of the past 5 years AZEK 4 years were profitable.
In the past 5 years AZEK always reported a positive cash flow from operatings.
1.2 Ratios
AZEK's Return On Assets of 6.73% is in line compared to the rest of the industry. AZEK outperforms 50.00% of its industry peers.
AZEK's Return On Equity of 10.55% is on the low side compared to the rest of the industry. AZEK is outperformed by 60.00% of its industry peers.
The Return On Invested Capital of AZEK (8.49%) is worse than 60.00% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for AZEK is significantly below the industry average of 13.09%.
The last Return On Invested Capital (8.49%) for AZEK is above the 3 year average (5.62%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.73% | ||
| ROE | 10.55% | ||
| ROIC | 8.49% |
ROA(3y)4.37%
ROA(5y)2.21%
ROE(3y)7.09%
ROE(5y)3.69%
ROIC(3y)5.62%
ROIC(5y)N/A
1.3 Margins
With a Profit Margin value of 9.85%, AZEK perfoms like the industry average, outperforming 57.50% of the companies in the same industry.
In the last couple of years the Profit Margin of AZEK has grown nicely.
With a Operating Margin value of 15.43%, AZEK perfoms like the industry average, outperforming 52.50% of the companies in the same industry.
In the last couple of years the Operating Margin of AZEK has grown nicely.
With a decent Gross Margin value of 37.32%, AZEK is doing good in the industry, outperforming 62.50% of the companies in the same industry.
AZEK's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 15.43% | ||
| PM (TTM) | 9.85% | ||
| GM | 37.32% |
OM growth 3Y6.95%
OM growth 5Y14.24%
PM growth 3Y10.41%
PM growth 5YN/A
GM growth 3Y4.35%
GM growth 5Y3.35%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so AZEK is destroying value.
The number of shares outstanding for AZEK has been reduced compared to 1 year ago.
AZEK has more shares outstanding than it did 5 years ago.
The debt/assets ratio for AZEK has been reduced compared to a year ago.
2.2 Solvency
An Altman-Z score of 6.40 indicates that AZEK is not in any danger for bankruptcy at the moment.
AZEK has a better Altman-Z score (6.40) than 75.00% of its industry peers.
AZEK has a debt to FCF ratio of 3.04. This is a good value and a sign of high solvency as AZEK would need 3.04 years to pay back of all of its debts.
The Debt to FCF ratio of AZEK (3.04) is better than 65.00% of its industry peers.
A Debt/Equity ratio of 0.37 indicates that AZEK is not too dependend on debt financing.
AZEK has a Debt to Equity ratio of 0.37. This is comparable to the rest of the industry: AZEK outperforms 60.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.37 | ||
| Debt/FCF | 3.04 | ||
| Altman-Z | 6.4 |
ROIC/WACC0.81
WACC10.49%
2.3 Liquidity
AZEK has a Current Ratio of 2.56. This indicates that AZEK is financially healthy and has no problem in meeting its short term obligations.
AZEK's Current ratio of 2.56 is fine compared to the rest of the industry. AZEK outperforms 65.00% of its industry peers.
AZEK has a Quick Ratio of 1.19. This is a normal value and indicates that AZEK is financially healthy and should not expect problems in meeting its short term obligations.
AZEK has a Quick ratio (1.19) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.56 | ||
| Quick Ratio | 1.19 |
3. Growth
3.1 Past
AZEK shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 35.11%, which is quite impressive.
The Earnings Per Share has been growing slightly by 6.98% on average over the past years.
AZEK shows a small growth in Revenue. In the last year, the Revenue has grown by 6.59%.
The Revenue has been growing by 12.66% on average over the past years. This is quite good.
EPS 1Y (TTM)35.11%
EPS 3Y6.98%
EPS 5YN/A
EPS Q2Q%70%
Revenue 1Y (TTM)6.59%
Revenue growth 3Y6.93%
Revenue growth 5Y12.66%
Sales Q2Q%18.71%
3.2 Future
Based on estimates for the next years, AZEK will show a quite strong growth in Earnings Per Share. The EPS will grow by 18.11% on average per year.
Based on estimates for the next years, AZEK will show a quite strong growth in Revenue. The Revenue will grow by 8.05% on average per year.
EPS Next Y21.74%
EPS Next 2Y19.65%
EPS Next 3Y18.11%
EPS Next 5YN/A
Revenue Next Year8.15%
Revenue Next 2Y8.38%
Revenue Next 3Y8.05%
Revenue Next 5YN/A
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 36.89, AZEK can be considered very expensive at the moment.
Based on the Price/Earnings ratio, AZEK is valued more expensive than 80.00% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 29.98, AZEK is valued a bit more expensive.
Based on the Price/Forward Earnings ratio of 27.27, the valuation of AZEK can be described as expensive.
Based on the Price/Forward Earnings ratio, AZEK is valued a bit more expensive than the industry average as 75.00% of the companies are valued more cheaply.
Compared to an average S&P500 Price/Forward Earnings ratio of 22.66, AZEK is valued a bit more expensive.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 36.89 | ||
| Fwd PE | 27.27 |
4.2 Price Multiples
AZEK's Enterprise Value to EBITDA ratio is a bit more expensive when compared to the industry. AZEK is more expensive than 72.50% of the companies in the same industry.
AZEK's Price/Free Cash Flow ratio is a bit more expensive when compared to the industry. AZEK is more expensive than 72.50% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 38.85 | ||
| EV/EBITDA | 19.78 |
4.3 Compensation for Growth
AZEK's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
AZEK's earnings are expected to grow with 18.11% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.7
PEG (5Y)N/A
EPS Next 2Y19.65%
EPS Next 3Y18.11%
5. Dividend
5.1 Amount
No dividends for AZEK!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
46.85
+1.03 (+2.25%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryBuilding Products
Earnings (Last)
Earnings (Next)
Inst Owners102.98%
Inst Owner Change0.91%
Ins Owners1.69%
Ins Owner Change0%
Market Cap6.73B
Analysts82.4
Price Target58.59 (25.06%)
Short Float %3.4%
Short Ratio3.42
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)16.23%
Min EPS beat(2)5.87%
Max EPS beat(2)26.6%
EPS beat(4)3
Avg EPS beat(4)10.87%
Min EPS beat(4)-3.47%
Max EPS beat(4)26.6%
EPS beat(8)7
Avg EPS beat(8)26.36%
EPS beat(12)10
Avg EPS beat(12)19.89%
EPS beat(16)14
Avg EPS beat(16)17.31%
Revenue beat(2)2
Avg Revenue beat(2)3.15%
Min Revenue beat(2)0.71%
Max Revenue beat(2)5.59%
Revenue beat(4)3
Avg Revenue beat(4)3.06%
Min Revenue beat(4)-1.5%
Max Revenue beat(4)7.44%
Revenue beat(8)7
Avg Revenue beat(8)2.92%
Revenue beat(12)11
Avg Revenue beat(12)3.03%
Revenue beat(16)14
Avg Revenue beat(16)3.19%
PT rev (1m)4.45%
PT rev (3m)11.86%
EPS NQ rev (1m)-2.14%
EPS NQ rev (3m)-1.68%
EPS NY rev (1m)1.96%
EPS NY rev (3m)2.54%
Revenue NQ rev (1m)0.52%
Revenue NQ rev (3m)0.56%
Revenue NY rev (1m)1.09%
Revenue NY rev (3m)1.35%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 36.89 | ||
| Fwd PE | 27.27 | ||
| P/S | 4.53 | ||
| P/FCF | 38.85 | ||
| P/OCF | 26.47 | ||
| P/B | 4.85 | ||
| P/tB | 25.17 | ||
| EV/EBITDA | 19.78 |
EPS(TTM)1.27
EY2.71%
EPS(NY)1.72
Fwd EY3.67%
FCF(TTM)1.21
FCFY2.57%
OCF(TTM)1.77
OCFY3.78%
SpS10.35
BVpS9.66
TBVpS1.86
PEG (NY)1.7
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.73% | ||
| ROE | 10.55% | ||
| ROCE | 11.54% | ||
| ROIC | 8.49% | ||
| ROICexc | 9.18% | ||
| ROICexgc | 23.48% | ||
| OM | 15.43% | ||
| PM (TTM) | 9.85% | ||
| GM | 37.32% | ||
| FCFM | 11.66% |
ROA(3y)4.37%
ROA(5y)2.21%
ROE(3y)7.09%
ROE(5y)3.69%
ROIC(3y)5.62%
ROIC(5y)N/A
ROICexc(3y)6.17%
ROICexc(5y)N/A
ROICexgc(3y)16.3%
ROICexgc(5y)N/A
ROCE(3y)7.64%
ROCE(5y)N/A
ROICexcg growth 3Y8.85%
ROICexcg growth 5Y6.33%
ROICexc growth 3Y13.94%
ROICexc growth 5Y24.98%
OM growth 3Y6.95%
OM growth 5Y14.24%
PM growth 3Y10.41%
PM growth 5YN/A
GM growth 3Y4.35%
GM growth 5Y3.35%
F-Score8
Asset Turnover0.68
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.37 | ||
| Debt/FCF | 3.04 | ||
| Debt/EBITDA | 1.45 | ||
| Cap/Depr | 62.28% | ||
| Cap/Sales | 5.45% | ||
| Interest Coverage | 4.91 | ||
| Cash Conversion | 70.76% | ||
| Profit Quality | 118.39% | ||
| Current Ratio | 2.56 | ||
| Quick Ratio | 1.19 | ||
| Altman-Z | 6.4 |
F-Score8
WACC10.49%
ROIC/WACC0.81
Cap/Depr(3y)90.69%
Cap/Depr(5y)108.06%
Cap/Sales(3y)8.18%
Cap/Sales(5y)10%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)35.11%
EPS 3Y6.98%
EPS 5YN/A
EPS Q2Q%70%
EPS Next Y21.74%
EPS Next 2Y19.65%
EPS Next 3Y18.11%
EPS Next 5YN/A
Revenue 1Y (TTM)6.59%
Revenue growth 3Y6.93%
Revenue growth 5Y12.66%
Sales Q2Q%18.71%
Revenue Next Year8.15%
Revenue Next 2Y8.38%
Revenue Next 3Y8.05%
Revenue Next 5YN/A
EBIT growth 1Y40.37%
EBIT growth 3Y14.36%
EBIT growth 5Y28.71%
EBIT Next Year59.71%
EBIT Next 3Y25.32%
EBIT Next 5YN/A
FCF growth 1Y3108.7%
FCF growth 3Y65.33%
FCF growth 5Y35.8%
OCF growth 1Y78.1%
OCF growth 3Y2.62%
OCF growth 5Y18.79%