Kaufman Bros. Starts Acuity Brands (AYI) at Hold; Current Valuation Fairly Reflects Near-term Prospects

Kaufman Bros. initiates coverage on Acuity Brands (NYSE: AYI) with a Hold. PT $52.

Kaufman analyst says, "Over the last two years, the stock has significantly
outperformed the overall market and its lighting solutions competitors resulting in a significant increase in its multiple. The stock has gone from trading at a 30% discount to the S&P 500 to trading at a 70% premium over this time period. We would look for the stock to trade closer to its historical average of a 20% premium. Therefore, we are applying a 17x multiple to our fiscal 2012 EPS estimate of $3.08 to drive our $52 price target. Should the commercial and residential new construction environment significantly improve, we believe the earnings growth potential could exceed previous cycle peaks. As a result, our estimates may be conservative and we would likely become increasingly more positive on the shares."

For more ratings news on Acuity Brands click here and for the rating history of Acuity Brands click here.

Shares of Acuity Brands closed at $56.53 yesterday.

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