AYI pitch:
– Acuity Brands is a very good business available at a very reasonable 14x PE.
– It is a market leader in the stable lighting and control industry.
– The company has shown consistent and growing profitability and FCF.
– AYI has excellent ROIC and a management that is returning substantial amounts of capital via buybacks.
– Above average company is available for below peer and historical multiples.
– A boring business routinely posting good numbers and beating their earnings estimates.
AYI valuation:
– Trades at forward PE of 14x vs long term average of 17.6.
– On EBITDA basis sits at 9.5x vs peers at 14x.
Exp. gain: +25% to $250/share by 2024. High teens IRR.
Full write-up (free guest account required): https://www.valueinvestorsclub.com/idea/ACUITY_BRANDS_INC/6400649676