WATTS WATER TECHNOLOGIES-A (WTS)
US9427491025 - Common Stock
WTS gets a fundamental rating of 7 out of 10. The analysis compared the fundamentals against 131 industry peers in the Machinery industry. WTS gets an excellent profitability rating and is at the same time showing great financial health properties. WTS is quite expensive at the moment. It does show a decent growth rate.
1. Profitability
1.1 Basic Checks
WTS had positive earnings in the past year.
WTS had a positive operating cash flow in the past year.
In the past 5 years WTS has always been profitable.
WTS had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
Looking at the Return On Assets, with a value of 11.65%, WTS belongs to the top of the industry, outperforming 85.83% of the companies in the same industry.
Looking at the Return On Equity, with a value of 16.54%, WTS is in the better half of the industry, outperforming 72.44% of the companies in the same industry.
With an excellent Return On Invested Capital value of 15.43%, WTS belongs to the best of the industry, outperforming 87.40% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for WTS is above the industry average of 11.01%.
The last Return On Invested Capital (15.43%) for WTS is above the 3 year average (15.03%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.65% | ||
| ROE | 16.54% | ||
| ROIC | 15.43% |
ROA(3y)11.1%
ROA(5y)9.5%
ROE(3y)16.93%
ROE(5y)14.98%
ROIC(3y)15.03%
ROIC(5y)13.56%
1.3 Margins
WTS has a better Profit Margin (12.37%) than 83.46% of its industry peers.
WTS's Profit Margin has improved in the last couple of years.
The Operating Margin of WTS (17.27%) is better than 82.68% of its industry peers.
WTS's Operating Margin has improved in the last couple of years.
WTS's Gross Margin of 47.14% is amongst the best of the industry. WTS outperforms 88.98% of its industry peers.
In the last couple of years the Gross Margin of WTS has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 17.27% | ||
| PM (TTM) | 12.37% | ||
| GM | 47.14% |
OM growth 3Y10.65%
OM growth 5Y7.18%
PM growth 3Y18.93%
PM growth 5Y9.28%
GM growth 3Y4.07%
GM growth 5Y2.18%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so WTS is still creating some value.
Compared to 1 year ago, WTS has about the same amount of shares outstanding.
Compared to 5 years ago, WTS has less shares outstanding
WTS has a worse debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 8.40 indicates that WTS is not in any danger for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 8.40, WTS belongs to the top of the industry, outperforming 90.55% of the companies in the same industry.
WTS has a debt to FCF ratio of 0.71. This is a very positive value and a sign of high solvency as it would only need 0.71 years to pay back of all of its debts.
With an excellent Debt to FCF ratio value of 0.71, WTS belongs to the best of the industry, outperforming 92.13% of the companies in the same industry.
WTS has a Debt/Equity ratio of 0.13. This is a healthy value indicating a solid balance between debt and equity.
The Debt to Equity ratio of WTS (0.13) is better than 77.17% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.13 | ||
| Debt/FCF | 0.71 | ||
| Altman-Z | 8.4 |
ROIC/WACC1.7
WACC9.1%
2.3 Liquidity
A Current Ratio of 2.55 indicates that WTS has no problem at all paying its short term obligations.
WTS has a better Current ratio (2.55) than 67.72% of its industry peers.
A Quick Ratio of 1.55 indicates that WTS should not have too much problems paying its short term obligations.
WTS has a Quick ratio of 1.55. This is in the better half of the industry: WTS outperforms 68.50% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.55 | ||
| Quick Ratio | 1.55 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 11.27% over the past year.
The Earnings Per Share has been growing by 17.20% on average over the past years. This is quite good.
Looking at the last year, WTS shows a quite strong growth in Revenue. The Revenue has grown by 12.36% in the last year.
Measured over the past years, WTS shows a small growth in Revenue. The Revenue has been growing by 5.61% on average per year.
EPS 1Y (TTM)11.27%
EPS 3Y28.58%
EPS 5Y17.2%
EPS Q2Q%-0.49%
Revenue 1Y (TTM)12.36%
Revenue growth 3Y10.88%
Revenue growth 5Y5.61%
Sales Q2Q%7.79%
3.2 Future
Based on estimates for the next years, WTS will show a small growth in Earnings Per Share. The EPS will grow by 6.03% on average per year.
WTS is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 5.60% yearly.
EPS Next Y6.71%
EPS Next 2Y4.68%
EPS Next 3Y5.49%
EPS Next 5Y6.03%
Revenue Next Year10.33%
Revenue Next 2Y6.09%
Revenue Next 3Y5.18%
Revenue Next 5Y5.6%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 23.98, which indicates a rather expensive current valuation of WTS.
Compared to the rest of the industry, the Price/Earnings ratio of WTS is on the same level as its industry peers.
The average S&P500 Price/Earnings ratio is at 28.96. WTS is around the same levels.
With a Price/Forward Earnings ratio of 23.26, WTS is valued on the expensive side.
The rest of the industry has a similar Price/Forward Earnings ratio as WTS.
The average S&P500 Price/Forward Earnings ratio is at 23.82. WTS is around the same levels.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.98 | ||
| Fwd PE | 23.26 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as WTS.
WTS's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. WTS is cheaper than 63.78% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 23.62 | ||
| EV/EBITDA | 15.63 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
WTS has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)3.58
PEG (5Y)1.39
EPS Next 2Y4.68%
EPS Next 3Y5.49%
5. Dividend
5.1 Amount
WTS has a yearly dividend return of 0.81%, which is pretty low.
WTS's Dividend Yield is comparable with the industry average which is at 1.54.
With a Dividend Yield of 0.81, WTS pays less dividend than the S&P500 average, which is at 2.23.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.81% |
5.2 History
On average, the dividend of WTS grows each year by 10.94%, which is quite nice.
WTS has paid a dividend for at least 10 years, which is a reliable track record.
WTS has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)10.94%
Div Incr Years11
Div Non Decr Years22
5.3 Sustainability
WTS pays out 19.04% of its income as dividend. This is a sustainable payout ratio.
WTS's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP19.04%
EPS Next 2Y4.68%
EPS Next 3Y5.49%
WATTS WATER TECHNOLOGIES-A
NYSE:WTS (11/21/2024, 8:04:00 PM)
Premarket: 214.81 +4.01 (+1.9%)210.8
+4.24 (+2.05%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap7.03B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.81% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
Max EPS beat(2)
EPS beat(4)
Avg EPS beat(4)
Min EPS beat(4)
Max EPS beat(4)
EPS beat(8)
Avg EPS beat(8)
EPS beat(12)
Avg EPS beat(12)
EPS beat(16)
Avg EPS beat(16)
Revenue beat(2)
Avg Revenue beat(2)
Min Revenue beat(2)
Max Revenue beat(2)
Revenue beat(4)
Avg Revenue beat(4)
Min Revenue beat(4)
Max Revenue beat(4)
Revenue beat(8)
Avg Revenue beat(8)
Revenue beat(12)
Avg Revenue beat(12)
Revenue beat(16)
Avg Revenue beat(16)
PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.98 | ||
| Fwd PE | 23.26 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)3.58
PEG (5Y)1.39
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.65% | ||
| ROE | 16.54% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 17.27% | ||
| PM (TTM) | 12.37% | ||
| GM | 47.14% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.94
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.13 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 2.55 | ||
| Quick Ratio | 1.55 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
High Growth Momentum
Growth
EPS 1Y (TTM)11.27%
EPS 3Y28.58%
EPS 5Y
EPS Q2Q%
EPS Next Y6.71%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)12.36%
Revenue growth 3Y10.88%
Revenue growth 5Y
Sales Q2Q%
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y