AYI has been successfully added to your Stock Email Alerts list.
You can manage your stock email alerts here.
AYI has been removed from your Stock Email Alerts list.
Please enter Portfolio Name for new portfolio.
Yacktman defines forward rate of return as the normalized free cash flow yield plus real growth plus inflation. Acuity Brands's forward rate of return for was 15.48%.
The historical rank and industry rank for Acuity Brands's Forward Rate of Return (Yacktman) % or its related term are showing as below:
During the past 13 years, Acuity Brands's highest Forward Rate of Return was 25.03. The lowest was 1.72. And the median was 15.34.
Unlike the Earnings Yield %, the Forward Rate of Return uses the normalized Free Cash Flow of the past seven years, and considers growth. The forward rate of return can be thought of as the return that investors buying the stock today can expect from it in the future.
The historical data trend for Acuity Brands's Forward Rate of Return (Yacktman) % can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
For the Electrical Equipment & Parts subindustry, Acuity Brands's Forward Rate of Return (Yacktman) %, along with its competitors' market caps and Forward Rate of Return (Yacktman) % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
For the Industrial Products industry and Industrials sector, Acuity Brands's Forward Rate of Return (Yacktman) % distribution charts can be found below:
* The bar in red indicates where Acuity Brands's Forward Rate of Return (Yacktman) % falls into.
Forward Rate of Return is a concept that Don Yacktman uses in his investment approach. Yacktman explained the forward rate of return concept in detail in his interview with GuruFocus. Yacktman defines forward rate of return as the normalized free cash flow yield plus real growth plus inflation. He said in the interview (March 2012, when the S&P 500 was at about 1400):
If the business is stable, this calculation is fairly straightforward. For instance, on the S&P 500 we would normalize earnings. We would then calculate what percentage of those earnings are not reinvested in the underlying businesses and are therefore free. Historically, for the S&P 500, this has been just under 50% of earnings. Currently, we expect the S&P to earn about 70 on a normalized basis, a number which is far below reported earnings due to our adjusting for record high profit margins. $70 X ½ / 1400 gives you a normalized free cash flow yield of approximately 2.5%.
The historical real growth rate of the S&P 500 (companies) is about 1.5%. Assuming an inflation rate of 2.5%, the forward rate of return on an investment in the S&P 500 is about 6.5% today (2.5% free cash flow yield plus 1.5% real growth plus 2.5% inflation).
Acuity Brands's Forward Rate of Return of Nov. 2023 is
Forward Rate of Return | = | Normalized Free Cash Flow | / | Price | + | 5-Year EBITDA Growth Rate |
= | 11.712 | / | 179.26 | + | 0.0895 | |
= | 15.48 % |
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Acuity Brands (NYSE:AYI) Forward Rate of Return (Yacktman) % Explanation
Unlike the Earnings Yield, the Forward Rate of Return uses the normalized Free Cash Flow of the past five years, and considers growth. The forward rate of return can be thought of as the return that investors buying the stock today can expect from it in the future.
For the growth part of the Forward Rate of Return calculation, GuruFocus uses the 5-year average growth rate of EBITDA per share as the growth rate, and the growth rate is always capped at 20%. For the Free Cash Flow we use per share data averaged over five years. The reason we use five years is to make it comparable to the growth rate.
Be Aware
In the Forward Rate of Return calculation, the growth rate is added directly to today's free cash flow yield. Therefore the calculation is reliable only if the company can grow at the same rate in the future as it did in the past. Investors should pay close attention to this when researching growth stocks. A more accurate measurement for return is Return on Capital.
Thank you for viewing the detailed overview of Acuity Brands's Forward Rate of Return (Yacktman) % provided by GuruFocus.com. Please click on the following links to see related term pages.
Dianne B Mills | officer: SVP & Chief HR Officer | C/O ACUITY BRANDS, INC., 1170 PEACHTREE STREET, NE, STE 2300, ATLANTA GA 30309 |
Barry R Goldman | officer: SVP & General Counsel | 1170 PEACHTREE STREET, NE, SUITE 2300, ATLANTA GA 30309 |
Laura O'shaughnessy | director | C/O VROOM, INC., 1375 BROADWAY, FLOOR 11, NEW YORK NY 10018 |
Karen J Holcom | officer: Interim CFO | 1170 PEACHTREE STREET, NE, SUITE 2400, ATLANTA GA 30309 |
Michael J Bender | director | 3980 BAUGHMAN GRANT ROAD, NEW ALBANY OH 43054 |
Marcia J Avedon | director | C/O INGERSOLL-RAND COMPANY, 800-E BEATY STREET, DAVIDSON NC 28036 |
Mark Sachleben | director | C/O NEW RELIC, INC., 188 SPEAR STREET, STE. 1200, SAN FRANCISCO CA 94105 |
Peter C Browning | director | GMS INC., 100 CRESCENT CENTRE PARKWAY, SUITE 800, TUCKER GA 30084 |
Mary A Winston | director | 557 BROADWAY, C/O SCHOLASTIC CORP, NEW YORK NY 10012 |
Maya Leibman | director | 4333 AMON CARTER BLVD, FORT WORTH TX 76155 |
Neil Ashe | director, officer: President & CEO | C/O ACUITY BRANDS, INC., 1170 PEACHTREE STREET, NE, STE 2300, ATLANTA GA 30309 |
Robert F Mccullough | director | 1170 PEACHTREE STREET, NE, SUITE 2300, ATLANTA GA 300309 |
Ray M Robinson | director | 1170 PEACHTREE STREET NE, SUITE 2300, ATLANTA GA 30309 |
Dillard George Douglas Jr | director | 1170 PEACHTREE STREET NE, SUITE 2300, ATLANTA GA 30309 |
W. Patrick Battle | director | 1170 PEACHTREE STREET NE, SUITE 2300, ATLANTA X1 30309 |
From GuruFocus
By Value_Insider 11-17-2022
By GlobeNewswire 11-17-2022
By GuruFocusNews 07-10-2022
By sperokesalga 05-25-2023
Disclaimers: GuruFocus.com is not operated by a broker or a dealer. It has an affiliated registered investment adviser, which serves as the subadviser to an exchange traded fund. This investment adviser does not provide advice to individual investors. Under no circumstances does any information posted on GuruFocus.com represent a recommendation to buy or sell a security. The information on this site, and in its related newsletters, is not intended to be, nor does it constitute investment advice or recommendations. The individuals or entities selected as "gurus" may buy and sell securities before and after any particular article and report and information herein is published, with respect to the securities discussed in any article and report posted herein. Gurus may be added or dropped from the GuruFocus site at any time. In no event shall GuruFocus.com be liable to any member, guest or third party for any damages of any kind arising out of the use of any content or other material published or available on GuruFocus.com, or relating to the use of, or inability to use, GuruFocus.com or any content, including, without limitation, any investment losses, lost profits, lost opportunity, special, incidental, indirect, consequential or punitive damages. Past performance is a poor indicator of future performance. The information on this site, and in its related newsletters, is not intended to be, nor does it constitute investment advice or recommendations. The information on this site is in no way guaranteed for completeness, accuracy or in any other way. The gurus listed in this website are not affiliated with GuruFocus.com, LLC. Stock quotes provided by InterActive Data. Fundamental company data provided by Morningstar, updated daily.