CHICAGO – The AZEK Company Inc. (NYSE: AZEK), a leading manufacturer of outdoor products, announced the authorization of a new stock repurchase program. The board of directors has given the green light to repurchase up to $600 million of Class A common stock. This new repurchase plan is in addition to approximately $75 million remaining from a previous authorization.
The company, known for its TimberTech decking and railing products, Versatex and AZEK Trim, and StruXure pergolas, said the share repurchase will be conducted opportunistically. Repurchase methods could include open market transactions, private negotiations, bank-structured transactions, accelerated share repurchases or tender offers. The company can also use 10b5-1 plans, which allow companies to repurchase shares at predetermined times to avoid insider trading charges.
The AZEK company has always been recognized for its innovation, quality, aesthetics and sustainability. Its products, made with up to 85% recycled materials, aim to replace wood outside homes, offering durable, eco-friendly and elegant alternatives. The company has been recognized for its climate and workplace leadership and won the 2024 Real Leaders Impact Awards.
This repurchase program announcement is a forward-looking statement and as such is subject to risks and uncertainties. The Company cautions that future events may differ materially due to numerous known and unknown risks. Investors are advised not to place undue reliance on these forward-looking statements.
The information in this article is based on a press release from The AZEK Company Inc.
In other recent news, The AZEK Company has made great strides in the home and building products industry in the United States. The company’s composite decking products are gaining traction in the repair and remodeling industry, with strong sell-through indicating robust demand. AZEK’s strategic use of a higher percentage of recycled content should improve margins over time.
In light of recent results, the company’s management raised its full-year forecast to $364-380 million. Analysts at RBC Capital Markets and Barclays Capital Inc. have maintained positive ratings for AZEK, reflecting a consensus that the company is well positioned for continued growth.
However, AZEK had to deal with an accounting error that required adjustments and delayed its second quarter results. Despite this, analysts believe the issue has been resolved and isolated, and underlying demand and margin trends remain favorable. The company also received a non-compliance notice from the New York Stock Exchange due to a delay in filing its quarterly financial report. AZEK has a six-month period to submit the overdue report and restore compliance.
Despite these challenges, AZEK reported a strong second quarter for fiscal 2024, with an 11% increase in consolidated net revenue to $418 million. The company raised its full-year net revenue and adjusted EBITDA forecasts, driven by solid growth in its residential segment and successful cost-cutting initiatives.
Insights from InvestingPro
The AZEK Company Inc. (NYSE: AZEK) recently made a strategic move by authorizing a $600 million stock repurchase program, demonstrating confidence in its financial stability and future growth prospects. This decision is in line with the positive outlook reflected in InvestingPro’s real-time data.
An important metric to consider is the company’s market capitalization, which stands at $6.85 billion, underscoring AZEK’s substantial presence in the outdoor products market. Additionally, the company’s P/E ratio currently stands at 47.08, suggesting a higher valuation than some industry peers, further emphasized by a trailing twelve month to Q2 adjusted P/E ratio 2024 equal to 57.12.
With revenue growth of 10.95% in the trailing twelve months as of Q2 2024, AZEK is demonstrating a strong ability to expand its earnings. This growth is in line with analyst sentiment, as reflected in one of InvestingPro’s recommendations, where 12 analysts have revised earnings upwards for the coming period. Additionally, the company trades at a high earnings multiple, which could be indicative of investor expectations for continued growth and profitability.
Investors considering AZEK stock will find other valuable insights at InvestingPro, where 12 more InvestingPro recommendations are available. These tips include an analysis of the company’s financial health, such as its ability to cover short-term obligations with liquid assets and operate with a moderate level of debt. For those looking for a complete analysis of investments, the InvestingPro subscription can be even more interesting thanks to the use of the coupon code PRONEWS24which guarantees an additional 10% discount on an annual or biennial Pro and Pro+ subscription.
The company’s recent performance also shows a significant return of 79.07% over the past year, which could be a compelling factor for potential investors. AZEK’s commitment to sustainability and innovation, combined with its strong financial metrics, positions it as an attractive option for those looking to invest in environmentally conscious companies with solid growth trajectories.
This article was generated and translated with the support of artificial intelligence and reviewed by an editor. For further information, please see our T&Cs.
