A O Smith Q4 revenue misses

Overview

• Water technology firm's Q4 revenue missed analyst expectations

• Adjusted EPS for Q4 beat analyst expectations

• Company closed Leonard Valve acquisition, enhancing water management platform

Outlook

• A. O. Smith projects 2026 sales to rise 2% to 5% from 2025

• Company expects 2026 EPS between $3.85 and $4.15

• Company anticipates mid-single digit sales decline in China for 2026

Result Drivers

• NORTH AMERICA PERFORMANCE - Pricing benefits and higher commercial water heater volumes drove profitability in North America, offsetting lower residential volumes and higher input costs

• CHINA MARKET CHALLENGES - Lower sales in China impacted Rest of World segment, but restructuring actions improved margins

• LEONARD VALVE ACQUISITION - Acquisition expected to enhance water management platform and align with higher growth opportunities

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "hold" and the breakdown of recommendations is 5 "strong buy" or "buy", 9 "hold" and 1 "sell" or "strong sell"

• The average consensus recommendation for the electrical components & equipment peer group is "buy."

• Wall Street's median 12-month price target for A O Smith Corp is $75.50, about 8.6% above its January 28 closing price of $69.49

• The stock recently traded at 17 times the next 12-month earnings vs. a P/E of 18 three months ago

Press Release: ID:nPnngKHQa

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