Thesis
AZZ, Inc. (AZZ) reported a strong Q1-20. The company consists of two business segments: Energy and Metal Coatings. Energy in recent years has been a problem for the company from both a revenue growth and profitability perspective. Metal Coatings, on the other hand, has been a consistently great business for AZZ, and the company continues to acquire competitors in this space to bolster its leading galvanizing position in North America.
In Q1, Energy revenue grew 13.6%, largely due to new business in China. Energy operating margins were 7.5% vs. 6.8% last year.