SMITH (A.O.) CORP (AOS)
US8318652091 - Common Stock
Taking everything into account, AOS scores 6 out of 10 in our fundamental rating. AOS was compared to 39 industry peers in the Building Products industry. AOS has outstanding health and profitabily ratings, belonging to the best of the industry. This is a solid base for any company. AOS has a valuation in line with the averages, but it does not seem to be growing. AOS also has an excellent dividend rating. With these ratings, AOS could be worth investigating further for dividend investing!.
1. Profitability
1.1 Basic Checks
AOS had positive earnings in the past year.
AOS had a positive operating cash flow in the past year.
AOS had positive earnings in each of the past 5 years.
Each year in the past 5 years AOS had a positive operating cash flow.
1.2 Ratios
Looking at the Return On Assets, with a value of 17.79%, AOS belongs to the top of the industry, outperforming 89.74% of the companies in the same industry.
AOS has a better Return On Equity (29.28%) than 82.05% of its industry peers.
With an excellent Return On Invested Capital value of 24.35%, AOS belongs to the best of the industry, outperforming 94.87% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for AOS is above the industry average of 13.33%.
The 3 year average ROIC (17.74%) for AOS is below the current ROIC(24.35%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 17.79% | ||
| ROE | 29.28% | ||
| ROIC | 24.35% |
ROA(3y)12.8%
ROA(5y)12.28%
ROE(3y)23.42%
ROE(5y)22.22%
ROIC(3y)17.74%
ROIC(5y)16.91%
1.3 Margins
AOS has a better Profit Margin (14.41%) than 76.92% of its industry peers.
AOS's Profit Margin has been stable in the last couple of years.
With a decent Operating Margin value of 19.04%, AOS is doing good in the industry, outperforming 74.36% of the companies in the same industry.
AOS's Operating Margin has improved in the last couple of years.
AOS has a Gross Margin of 38.21%. This is in the better half of the industry: AOS outperforms 66.67% of its industry peers.
In the last couple of years the Gross Margin of AOS has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 19.04% | ||
| PM (TTM) | 14.41% | ||
| GM | 38.21% |
OM growth 3Y7.77%
OM growth 5Y2%
PM growth 3Y6.64%
PM growth 5Y0.73%
GM growth 3Y0.23%
GM growth 5Y-1.21%
2. Health
2.1 Basic Checks
AOS has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
AOS has less shares outstanding than it did 1 year ago.
AOS has less shares outstanding than it did 5 years ago.
The debt/assets ratio for AOS has been reduced compared to a year ago.
2.2 Solvency
An Altman-Z score of 7.78 indicates that AOS is not in any danger for bankruptcy at the moment.
With an excellent Altman-Z score value of 7.78, AOS belongs to the best of the industry, outperforming 84.62% of the companies in the same industry.
AOS has a debt to FCF ratio of 0.25. This is a very positive value and a sign of high solvency as it would only need 0.25 years to pay back of all of its debts.
AOS's Debt to FCF ratio of 0.25 is amongst the best of the industry. AOS outperforms 87.18% of its industry peers.
AOS has a Debt/Equity ratio of 0.06. This is a healthy value indicating a solid balance between debt and equity.
With a decent Debt to Equity ratio value of 0.06, AOS is doing good in the industry, outperforming 79.49% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.06 | ||
| Debt/FCF | 0.25 | ||
| Altman-Z | 7.78 |
ROIC/WACC2.39
WACC10.17%
2.3 Liquidity
A Current Ratio of 1.67 indicates that AOS should not have too much problems paying its short term obligations.
The Current ratio of AOS (1.67) is worse than 69.23% of its industry peers.
AOS has a Quick Ratio of 1.02. This is a normal value and indicates that AOS is financially healthy and should not expect problems in meeting its short term obligations.
AOS's Quick ratio of 1.02 is on the low side compared to the rest of the industry. AOS is outperformed by 74.36% of its industry peers.
The current and quick ratio evaluation for AOS is rather negative, while it does have excellent solvency and profitability. These ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.67 | ||
| Quick Ratio | 1.02 |
3. Growth
3.1 Past
AOS shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 3.77%.
The Earnings Per Share has been growing slightly by 7.92% on average over the past years.
AOS shows a small growth in Revenue. In the last year, the Revenue has grown by 2.45%.
The Revenue has been growing slightly by 3.86% on average over the past years.
EPS 1Y (TTM)3.77%
EPS 3Y20.74%
EPS 5Y7.92%
EPS Q2Q%-8.89%
Revenue 1Y (TTM)2.45%
Revenue growth 3Y9.99%
Revenue growth 5Y3.86%
Sales Q2Q%-3.72%
3.2 Future
Based on estimates for the next years, AOS will show a small growth in Earnings Per Share. The EPS will grow by 6.45% on average per year.
AOS is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 2.86% yearly.
EPS Next Y-0.32%
EPS Next 2Y3.65%
EPS Next 3Y5.32%
EPS Next 5Y6.45%
Revenue Next Year0.26%
Revenue Next 2Y1.78%
Revenue Next 3Y2.88%
Revenue Next 5Y2.86%
3.3 Evolution
The EPS growth rate is stable: in the next years the growth will be about the same than in the last years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 17.89, the valuation of AOS can be described as rather expensive.
AOS's Price/Earnings ratio is in line with the industry average.
AOS is valuated rather cheaply when we compare the Price/Earnings ratio to 27.54, which is the current average of the S&P500 Index.
With a Price/Forward Earnings ratio of 16.79, AOS is valued correctly.
AOS's Price/Forward Earnings ratio is in line with the industry average.
The average S&P500 Price/Forward Earnings ratio is at 23.99. AOS is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 17.89 | ||
| Fwd PE | 16.79 |
4.2 Price Multiples
AOS's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. AOS is cheaper than 71.79% of the companies in the same industry.
66.67% of the companies in the same industry are more expensive than AOS, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 16.96 | ||
| EV/EBITDA | 9.78 |
4.3 Compensation for Growth
The excellent profitability rating of AOS may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)2.26
EPS Next 2Y3.65%
EPS Next 3Y5.32%
5. Dividend
5.1 Amount
AOS has a Yearly Dividend Yield of 1.99%. Purely for dividend investing, there may be better candidates out there.
The stock price of AOS dropped by -23.95% in the last 3 months. With lower prices the dividend yield is higher, but it may be a sign investors do not trust the long term dividend.
AOS's Dividend Yield is rather good when compared to the industry average which is at 1.07. AOS pays more dividend than 100.00% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.36, AOS has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.99% |
5.2 History
The dividend of AOS is nicely growing with an annual growth rate of 9.92%!
AOS has paid a dividend for at least 10 years, which is a reliable track record.
AOS has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)9.92%
Div Incr Years26
Div Non Decr Years26
5.3 Sustainability
AOS pays out 33.62% of its income as dividend. This is a sustainable payout ratio.
The dividend of AOS is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP33.62%
EPS Next 2Y3.65%
EPS Next 3Y5.32%
SMITH (A.O.) CORP
NYSE:AOS (12/24/2024, 7:55:36 PM)
After market: 68.89 0 (0%)68.89
+0.33 (+0.48%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryBuilding Products
Earnings (Last)
Earnings (Next)
Inst Owners98.4%
Inst Owner Change-0.7%
Ins Owners0.6%
Ins Owner Change-0.5%
Market Cap8.21B
Analysts69.47
Price Target84.34 (22.43%)
Short Float %2.74%
Short Ratio3.01
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.99% |
Dividend Growth(5Y)9.92%
DP33.62%
Div Incr Years26
Div Non Decr Years26
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-1.63%
Min EPS beat(2)-2.25%
Max EPS beat(2)-1.02%
EPS beat(4)2
Avg EPS beat(4)-0.47%
Min EPS beat(4)-2.25%
Max EPS beat(4)0.96%
EPS beat(8)6
Avg EPS beat(8)6.01%
EPS beat(12)9
Avg EPS beat(12)5.14%
EPS beat(16)13
Avg EPS beat(16)7.33%
Revenue beat(2)1
Avg Revenue beat(2)0.2%
Min Revenue beat(2)-1.22%
Max Revenue beat(2)1.62%
Revenue beat(4)1
Avg Revenue beat(4)-0.76%
Min Revenue beat(4)-2.7%
Max Revenue beat(4)1.62%
Revenue beat(8)4
Avg Revenue beat(8)0.25%
Revenue beat(12)6
Avg Revenue beat(12)0.25%
Revenue beat(16)9
Avg Revenue beat(16)1.25%
PT rev (1m)-4.11%
PT rev (3m)-6.28%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-13.71%
EPS NY rev (1m)-0.16%
EPS NY rev (3m)-7.11%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-7.6%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-3.25%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 17.89 | ||
| Fwd PE | 16.79 | ||
| P/S | 2.11 | ||
| P/FCF | 16.96 | ||
| P/OCF | 13.88 | ||
| P/B | 4.28 | ||
| P/tB | 8.75 | ||
| EV/EBITDA | 9.78 |
EPS(TTM)3.85
EY5.59%
EPS(NY)4.1
Fwd EY5.96%
FCF(TTM)4.06
FCFY5.9%
OCF(TTM)4.96
OCFY7.2%
SpS32.69
BVpS16.09
TBVpS7.87
PEG (NY)N/A
PEG (5Y)2.26
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 17.79% | ||
| ROE | 29.28% | ||
| ROCE | 32.1% | ||
| ROIC | 24.35% | ||
| ROICexc | 27.38% | ||
| ROICexgc | 52.31% | ||
| OM | 19.04% | ||
| PM (TTM) | 14.41% | ||
| GM | 38.21% | ||
| FCFM | 12.43% |
ROA(3y)12.8%
ROA(5y)12.28%
ROE(3y)23.42%
ROE(5y)22.22%
ROIC(3y)17.74%
ROIC(5y)16.91%
ROICexc(3y)22.46%
ROICexc(5y)22.09%
ROICexgc(3y)48.67%
ROICexgc(5y)47.52%
ROCE(3y)23.38%
ROCE(5y)22.28%
ROICexcg growth 3Y8.35%
ROICexcg growth 5Y3.57%
ROICexc growth 3Y11.48%
ROICexc growth 5Y2.82%
OM growth 3Y7.77%
OM growth 5Y2%
PM growth 3Y6.64%
PM growth 5Y0.73%
GM growth 3Y0.23%
GM growth 5Y-1.21%
F-Score7
Asset Turnover1.23
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.06 | ||
| Debt/FCF | 0.25 | ||
| Debt/EBITDA | 0.13 | ||
| Cap/Depr | 133.62% | ||
| Cap/Sales | 2.76% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 71.95% | ||
| Profit Quality | 86.23% | ||
| Current Ratio | 1.67 | ||
| Quick Ratio | 1.02 | ||
| Altman-Z | 7.78 |
F-Score7
WACC10.17%
ROIC/WACC2.39
Cap/Depr(3y)93.51%
Cap/Depr(5y)86.76%
Cap/Sales(3y)1.96%
Cap/Sales(5y)2%
Profit Quality(3y)119.94%
Profit Quality(5y)122.44%
High Growth Momentum
Growth
EPS 1Y (TTM)3.77%
EPS 3Y20.74%
EPS 5Y7.92%
EPS Q2Q%-8.89%
EPS Next Y-0.32%
EPS Next 2Y3.65%
EPS Next 3Y5.32%
EPS Next 5Y6.45%
Revenue 1Y (TTM)2.45%
Revenue growth 3Y9.99%
Revenue growth 5Y3.86%
Sales Q2Q%-3.72%
Revenue Next Year0.26%
Revenue Next 2Y1.78%
Revenue Next 3Y2.88%
Revenue Next 5Y2.86%
EBIT growth 1Y115.77%
EBIT growth 3Y18.54%
EBIT growth 5Y5.93%
EBIT Next Year8.06%
EBIT Next 3Y6.65%
EBIT Next 5Y5.84%
FCF growth 1Y21.49%
FCF growth 3Y5.76%
FCF growth 5Y10.45%
OCF growth 1Y23.42%
OCF growth 3Y6.04%
OCF growth 5Y8.35%