Metal coating and infrastructure solutions provider AZZ (NYSE: AZZ) reported Q1 CY2026 results exceeding the market’s revenue expectations, with sales up 9.4% year on year to $385.1 million. The company expects the full year’s revenue to be around $1.75 billion, close to analysts’ estimates. Its non-GAAP profit of $1.34 per share was 9.9% above analysts’ consensus estimates.

Is now the time to buy AZZ? Find out by accessing our full research report, it’s free.

Company Overview

Responsible for projects like nuclear facilities, AZZ (NYSE: AZZ) is a provider of metal coating and power infrastructure solutions.

Revenue Growth

A company’s long-term sales performance can indicate its overall quality. Any business can experience short-term success, but top-performing ones enjoy sustained growth for years. Luckily, AZZ’s sales grew at an exceptional 14.5% compounded annual growth rate over the last five years. Its growth surpassed the average industrials company and shows its offerings resonate with customers, a great starting point for our analysis.

Long-term growth is the most important, but within industrials, a half-decade historical view may miss new industry trends or demand cycles. AZZ’s recent performance shows its demand has slowed significantly as its annualized revenue growth of 3.6% over the last two years was well below its five-year trend.

This quarter, AZZ reported year-on-year revenue growth of 9.4%, and its $385.1 million of revenue exceeded Wall Street’s estimates by 0.7%.

Looking ahead, sell-side analysts expect revenue to grow 5.4% over the next 12 months. Although this projection suggests its newer products and services will catalyze better top-line performance, it is still below the sector average. At least the company is tracking well in other measures of financial health.

ONE MORE THING: The $21 AI Application Stock Wall Street Forgot. While Wall Street obsesses over who’s building AI, one company is already using it to print money. And nobody’s paying attention.

AI chip stocks trade at ridiculous valuations. This company processes a trillion consumer signals monthly using AI and trades at a third of the price. The gap won’t last. The institutions will figure it out. You need to see this first. Read the FREE Report Before They Notice.

Operating Margin

Operating margin is a key measure of profitability. Think of it as net income - the bottom line - excluding the impact of taxes and interest on debt, which are less connected to business fundamentals.

AZZ’s operating margin has generally stayed the same over the last 12 months, averaging 15.3% over the last five years. This profitability was top-notch for an industrials business, showing it’s an well-run company with an efficient cost structure. This was particularly impressive because of its low gross margin, which is mostly a factor of what it sells and takes huge shifts to move meaningfully. Companies have more control over their operating margins, and it’s a show of well-managed operations if they’re high when gross margins are low.

Analyzing the trend in its profitability, AZZ’s operating margin might fluctuated slightly but has generally stayed the same over the last five years. This raises questions about the company’s expense base because its revenue growth should have given it leverage on its fixed costs, resulting in better economies of scale and profitability.

This quarter, AZZ generated an operating margin profit margin of 14.8%, up 1.3 percentage points year on year. The increase was encouraging, and because its operating margin rose more than its gross margin, we can infer it was more efficient with expenses such as marketing, R&D, and administrative overhead.

Earnings Per Share

Revenue trends explain a company’s historical growth, but the long-term change in earnings per share (EPS) points to the profitability of that growth – for example, a company could inflate its sales through excessive spending on advertising and promotions.

AZZ’s EPS grew at 23.9% compounded annual growth rate over the last five years, higher than its 14.5% annualized revenue growth. This tells us the company became more profitable on a per-share basis as it expanded.

Like with revenue, we analyze EPS over a more recent period because it can provide insight into an emerging theme or development for the business.

For AZZ, its two-year annual EPS growth of 16.9% was lower than its five-year trend. We still think its growth was good and hope it can accelerate in the future.

In Q1, AZZ reported adjusted EPS of $1.34, up from $0.98 in the same quarter last year. This print beat analysts’ estimates by 9.9%. Over the next 12 months, Wall Street expects AZZ’s full-year EPS of $6.19 to grow 9.1%.

Key Takeaways from AZZ’s Q1 Results

We enjoyed seeing AZZ beat analysts’ adjusted operating income expectations this quarter. We were also glad its EPS outperformed Wall Street’s estimates. On the other hand, its full-year EBITDA guidance missed. Overall, this print had some key positives. Investors were likely hoping for more, and shares traded down 2% to $131.99 immediately following the results.

So do we think AZZ is an attractive buy at the current price? The latest quarter does matter, but not nearly as much as longer-term fundamentals and valuation, when deciding if the stock is a buy. We cover that in our actionable full research report which you can read here (it’s free).