Acuity Brands:  Better, Smarter, Faster—and Cheaper!

The tagline for the Acuity’s digital transformation is Better Smarter Faster.  After today’s investor call, they may want to add another adjective—Cheaper.
Last Friday Acuity’s stock price was less than $100 and it has been on a tear since, opening Thursday at $113.63. Acuity reported relatively good news, sales only down 5%, yet their stock was hit hard down almost 12%–most of that occurring during the investor call.

Many stocks gain on the rumor and sell on the result—even good results.  Although, their stock price dropped significantly, it is still higher than it was one week ago. The stock drop can likely be attributed to the recent share price run-up.
But the investor call was curious.  The words, price (32) and disproportionate share (5) rang throughout the call:
Here are a few quotes:
12:46:    Strategic Initiatives in price
15: 40:    Strong traction with contractor select portfolio…as we were able to respond to discretionary opportunities
17:52:     Intention to be aggressive where we believe we need to be, including taking any actions which we deem necessary around price.
23:20:   It’s our intention to manage to this level and we were able to invest strategically
24:33:   We are managing our share gain with our gross margin to ensure that we take at least our share if not a disproportionate share.
27:48:   Whenever you make strategic investments in price you try to be as strategic as you possibly can and correlate those to share gains.
28:40:   Pick up At least our share if not a disproportionate share of the new activity
41:13:     Take a disproportionate share or at more disproportionate than our current share and you have seen evidence of that in the current performance
44:03:    Comments we had around the strategic price investment that we made and that we will continue to make, given this difficult market environment
52:21:    We mentioned that we were strategic about where we were investing in price to balance supply and demand to ensure we were taking share.
52:51:    We want to take a disproportionate share of the demand that does exist… So we will be targeted in our investments in price to try to maintain that while maintaining our gross margin target.
53:15:    We will be as aggressive as we feel we need to be to drive our positioning in the market.
Why is Acuity so  public about ‘investing in price,’ which sounds like an oxymoron? As if the pandemic and recession weren’t enough turmoil this year,  it appears that Acuity is publicly declaring a price war.

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