A. O. Smith (AOS) – Research Analysts’ Recent Ratings Updates

Several brokerages have updated their recommendations and price targets on shares of A. O. Smith (NYSE: AOS) in the last few weeks:

  • 1/31/2018 – A. O. Smith was upgraded by analysts at Zacks Investment Research from a “sell” rating to a “hold” rating. They now have a $75.00 price target on the stock. According to Zacks, “A.O. Smith’s fourth-quarter 2017 earnings grew 28% from the year-ago tally on the back of robust sales growth. A flourishing water heater industry, robust consumer product demand in China and positive industry trends are likely to drive top-line growth, going forward. Hague products and Aquasana have also significantly boosted the company’s sales. Also, a dominant foothold in the North American water heater market is likely to stoke growth. Over the past six months, A.O. Smith’s stock has outperformed the industry average. However, over the past few quarters, the company’s SG&A expenses in China (including elevated steel costs and higher fees paid to installers) have been quite high, which is creating pressure on the company’s operating margins. Also, transition of the Chinese economy to a consumer-driven one might impact A.O. Smith’s sales in the region.”
  • 1/31/2018 – A. O. Smith had its “buy” rating reaffirmed by analysts at Robert W. Baird. They now have a $70.00 price target on the stock.
  • 1/30/2018 – A. O. Smith had its “hold” rating reaffirmed by analysts at Boenning Scattergood.
  • 1/26/2018 – A. O. Smith had its “buy” rating reaffirmed by analysts at BMO Capital Markets. They now have a $78.00 price target on the stock.
  • 1/11/2018 – A. O. Smith was upgraded by analysts at Zacks Investment Research from a “sell” rating to a “hold” rating. According to Zacks, “Over the past six months, A.O. Smith’s stock has outperformed the industry average. The company also has an impressive earnings surprise history, having beaten estimates thrice over the four trailing quarters.  A flourishing water heater industry, robust consumer product demand in China and positive industry trends are likely to drive top-line growth, going forward. Also, acquisition of residential water treatment firm, Aquasana, looks promising. However, on the flip side, appreciation in steel prices is expected to put margins under pressure. Moreover, transition of the Chinese economy to a consumer driven one has resulted in a significant slowdown that might impact the company’s sales in the region.  Also, strong competition in the water boilers and heaters industry compounds the company’s challenges.”
  • 12/26/2017 – A. O. Smith was downgraded by analysts at Zacks Investment Research from a “hold” rating to a “sell” rating. According to Zacks, “Over the past six months, A.O. Smith’s stock has outperformed the industry average. A flourishing water heater industry, robust consumer product demand in China and positive industry trends are likely to drive top-line growth, going forward. However, on the flip side, appreciation in steel prices is expected to put margins under pressure. Devaluation of the Chinese currency and rising selling and administrative expenses are expected to act as headwinds, going forward. Moreover, transition of the Chinese economy to a consumer driven one has resulted in a significant slowdown that might impact the company’s sales in the region.  Also, strong competition in the water boilers and heaters industry compounds the company’s challenges. This apart, costs related to ERP implementation and expansion pose as major threats for the company’s profitability.”

A. O. Smith Corp (AOS) opened at $60.96 on Monday. A. O. Smith Corp has a fifty-two week low of $48.92 and a fifty-two week high of $68.39. The stock has a market capitalization of $10,480.73, a P/E ratio of 35.86, a P/E/G ratio of 1.78 and a beta of 1.53. The company has a debt-to-equity ratio of 0.24, a current ratio of 2.24 and a quick ratio of 1.87.

A. O. Smith (NYSE:AOS) last issued its quarterly earnings data on Tuesday, January 30th. The industrial products company reported $0.60 earnings per share (EPS) for the quarter, topping analysts’ consensus estimates of $0.56 by $0.04. The business had revenue of $768.60 million during the quarter, compared to analyst estimates of $767.45 million. A. O. Smith had a return on equity of 23.30% and a net margin of 9.89%. The business’s revenue for the quarter was up 10.1% compared to the same quarter last year. During the same period in the prior year, the company posted $0.47 EPS. analysts anticipate that A. O. Smith Corp will post 2.57 earnings per share for the current fiscal year.

The company also recently declared a quarterly dividend, which will be paid on Thursday, February 15th. Shareholders of record on Wednesday, January 31st will be paid a dividend of $0.18 per share. This is a positive change from A. O. Smith’s previous quarterly dividend of $0.14. This represents a $0.72 dividend on an annualized basis and a yield of 1.18%. The ex-dividend date of this dividend is Tuesday, January 30th. A. O. Smith’s dividend payout ratio (DPR) is presently 42.35%.

In other A. O. Smith news, Director William P. Greubel sold 17,856 shares of the stock in a transaction on Thursday, February 1st. The stock was sold at an average price of $66.50, for a total transaction of $1,187,424.00. The sale was disclosed in a document filed with the Securities & Exchange Commission, which can be accessed through this hyperlink. Also, insider Peter R. Martineau sold 9,723 shares of the stock in a transaction on Friday, November 17th. The shares were sold at an average price of $59.02, for a total value of $573,851.46. The disclosure for this sale can be found here. Over the last ninety days, insiders have sold 86,151 shares of company stock valued at $5,384,359. 1.27% of the stock is currently owned by corporate insiders.

A. O. Smith Corporation operates through two segments: North America and Rest of World. The Company’s Rest of World segment primarily consists of China, Europe and India. Both segments manufacture and market comprehensive lines of residential and commercial gas, gas tankless and electric water heaters, as well as water treatment products.

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