How sustainable is AZEK's EPS growth trend?

AZEK's EPS growth trend appears to be on a declining trajectory, with recent negative YoY growth. The company's recent financial performance and market outlook suggest that the sustainability of its EPS growth trend is currently under pressure.

1. **Recent Performance**: AZEK's most recent reported fiscal quarter was for Q1 2025, in which the company delivered results that surpassed analyst projections. However, the company's year-over-year (YoY) growth in EPS was negative, with a decline of 23.53% reported as of March 31, 2025.

|code|Ticker|Name|Date|Diluted EPS YoY|market_code|
|---|---|---|---|---|---|
|AZEK|AZEK.N|AZEK|2024 Q2|183.33333333333337|169|
|AZEK|AZEK.N|AZEK|2024 Q3|47.82608695652174|169|
|AZEK|AZEK.N|AZEK|2025 Q1|-29.41176470588236|169|

|code|Ticker|Name|Date|Diluted EPS YoY|Diluted EPS QoQ|market_code|
|---|---|---|---|---|---|---|
|AZEK|AZEK.N|AZEK|2024 Q2|183.33333333333337|100|169|
|AZEK|AZEK.N|AZEK|2024 Q3|47.82608695652174|0|169|
|AZEK|AZEK.N|AZEK|2025 Q1|-29.41176470588236||169|

2. **Market Conditions and Outlook**: The composite decking industry, in which AZEK operates, is subject to market fluctuations and competitive pressures. The company's announced merger with James Hardie is expected to shape its future performance, but the sustainability of EPS growth will depend on the successful integration of this merger and the company's ability to maintain its market position and profitability in a competitive landscape.
3. **Analyst Expectations**: Analysts anticipate continued strong mid-si, but the sustainability of EPS growth will depend on the company's execution of its business strategy and market conditions. The consensus EPS estimate for the upcoming quarter ending March 2024, is $0.38 per share, representing a year-over-year change of +111.1%. However, the expected EPS decline in the quarter ending September 2024, is $0.26 per share, representing a year-over-year change of -27.8%.
4. **Sustainability Concerns**: The sustainability of AZEK's EPS growth trend is a concern, given the recent negative growth and the expected decline in future quarters. The company's ability to reverse this trend will depend on its operational performance, market conditions, and strategic initiatives such as the merger with James Hardie.

In conclusion, while AZEK has a history of EPS growth, the recent negative growth and the expected decline in future quarters suggest that the sustainability of this trend is currently under pressure. The company's future performance will be closely watched to determine if the EPS growth can be sustained.