What drove AZEK's EPS surprises in 2024?

The AZEK Co Inc (NYSE:AZEK) experienced a positive EPS surprise in 2024, with the EPS coming in at $0.12 for the most recent quarter, compared to the diluted EPS of $0.12. This was largely driven by strong sales growth and margin expansions.

1. **Net Sales Growth**: AZEK saw a robust 12% year-over-year net sales growth for fiscal 2024, reaching $1.43 billion. This was primarily fueled by record sales growth in its deck, rail, and accessories segments, which saw an 18% sales growth. The company's residential segment also performed well, achieving high single-digit growth.
2. **Margin Expansions**: The company's net profit margin expanded by 600 basis points to 10.6% year-over-year, and the adjusted EBITDA margin expanded by 560 basis points to a record 26.3%. This indicates improved profitability and operational efficiency.
3. **New Product Launches and Market Expansion**: AZEK's strategic initiatives, including new product launches and expanded distribution partnerships, have positioned the company well for future growth. These efforts are expected to capitalize on more than $2 billion of addressable market opportunity.

In summary, AZEK's EPS surprise in 2024 was driven by strong sales growth, particularly in its deck, rail, and accessories segments, significant margin expansions, and strategic initiatives that position the company for future growth.

|code|Ticker|Name|Date|Estimate EPS|EPS Surprise|market_code|
|---|---|---|---|---|---|---|
|AZEK|AZEK.N|AZEK|2024 Q2|0.36||169|
|AZEK|AZEK.N|AZEK|2024 Q3|0.36|0.06|169|
|AZEK|AZEK.N|AZEK|2024 Q4|0.27|0.02|169|
|AZEK|AZEK.N|AZEK|2025 Q1|0.13|0.04|169|