Azek Story

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AZEK -- USA Stock  

USD 32.28  0.23  0.72%

It looks like Quanex Building will be up for a correction way faster as its share price whent up 5.45% today to Azek's 1.5835%. As many rational traders are trying to avoid industrials space, it makes sense to examine The Azek Company a little further and understand how it stands against Quanex Building and other similar entities. We are going to concentrate on some of the competitive aspects of both Azek and Quanex.
Published over a month ago
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What should I exit first Azek (NYSE:AZEK) or Quanex Building?
By analyzing existing basic indicators between Azek and Quanex, you can compare the effects of market volatilities on both companies' prices and check if they can diversify away market risk if combined in one of your portfolios. You can also utilize pair trading strategies for matching a long position in Quanex with a short position in Azek. Check out our pair correlation module for more information.

Let's begin by analyzing the assets. The concept of asset utilization usually refers to the revenue earned for every dollar of assets a company currently reports. The recent return on assets of Azek signifies not a very effective usage of assets in August.
Out of tens of thousands of stocks, funds, and ETFs that trade on global exchanges each represent an individual company which you can analyze using comparative analysis. To determine which one of the two companies, such as Azek or Quanex is a better fit for your portfolio, analyzing a few basic fundamental indicators is a good first step.

How important is Azek's Liquidity

Azek financial leverage refers to using borrowed capital as a funding source to finance The Azek Company ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Azek financial leverage is typically calculated by taking the company's all interest-bearing debt and dividing it by total capital. So the higher the debt-to-capital ratio (i.e., financial leverage), the riskier the company. Please check the breakdown between Azek's total debt and its cash.

What do experts say?

Stock analysis is a method for investors and traders to make buying and selling decisions. By studying and evaluating past and current data, investors and traders attempt to gain an edge in the markets by making informed decisions. It is good to see analyst projects for Azek, but it might be worth checking our own buy vs. sell analysis

Correlation Between Azek and Quanex Building Prod

In general, stock analysis is a method for investors and traders to make individual buying and selling decisions. Stock correlation analysis is also essential because it can help investors realize that they may not be as diversified as they think. Risk management strategies are usually required to make sure all portfolios are properly aligned against their risk tolerance level. You can consider holding Azek together with similar or unrelated positions with a negative correlation. For example, you can also add Quanex Building to your portfolio. If Quanex Building is not perfectly correlated to Azek it will diversify some of the market risks out of the positively correlated stocks in your portfolio. However, the disadvantage of this sort of hedging is that it can potentially affect your investment returns throughout market cycles. When Azek for example, for example, performs excellent and delivers stable returns, the negatively correlated position you locked in as a hedge may drag your returns down. Please check pair correlation details between AZEK and NX for more information.

Breaking down Azek Indicators

Revenue is income that a firm generates from business activities such us rendering services or selling goods to customers. It is a crucial part of a business and an essential item when evaluating a company's financial statements. Revenues from a firm's primary business operations can be reported on the income statement as sales revenue, net sales, or simply sales, depending on the industry in which a given company operates.
Revenue is typically recorded when cash or cash equivalents are exchanged for services or goods and can include product or services discounts, promotions, as well as early payments on invoices or services rendered in advance.

Revenue Breakdown

Now, let's check Azek revenue. Based on the latest financial disclosure, The Azek Company reported 848.47 M of revenue. This is 75.75% lower than that of the Industrials sector and significantly higher than that of the Building Products & Equipment industry. The revenue for all United States stocks is 91.01% higher than that of the company. As for Quanex Building we see revenue of 862.9 M, which is much higher than that of the Building Products & Equipment

Azek848.47 Million
Quanex862.9 Million
848.5 M
862.9 M

Momentum Analysis of Azek suggests possible reversal in September

Potential upside is down to 5.2. It may signify a possible volatility plunge. As of the 13th of August 2020, Azek shows the Risk Adjusted Performance of 0.4043, semi deviation of 0.935, and Mean Deviation of 1.69. Azek technical analysis gives you the methodology to make use of historical prices and volume patterns to determine a pattern that approximates the direction of the firm's future prices. Put another way, you can use this information to find out if the firm will indeed mirror its model of historical prices and volume momentum, or the prices will eventually revert. We were able to analyze nineteen technical drivers for The Azek Company, which can be compared to its rivals. Please confirm Azek jensen alpha, and the relationship between the coefficient of variation and potential upside to decide if Azek is priced correctly, providing market reflects its regular price of 34.0 per share. Given that Azek has jensen alpha of 0.6086, we suggest you to validate The Azek Company's prevailing market performance to make sure the company can sustain itself at a future point.

Our Final Perspective on Azek

Although other entities under the building products & equipment industry are still a bit expensive, Azek may offer a potential longer-term growth to traders. All things considered, as of the 13th of August 2020, we believe that at this point, Azek is very steady with close to average chance of distress within the next 2 years. From a slightly different point of view, the entity appears to be fairly valued. Our primary 30 days buy-or-sell advice on the firm is Strong Hold.

About Contributor

This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Achuva Shats do not own shares of The Azek Company. Please refer to our Terms of Use for any information regarding our disclosure principles.

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