WATTS WATER TECHNOLOGIES-A (WTS) Stock Fundamental Analysis
USA - NYSE:WTS - US9427491025 - Common Stock
285.86 USD
+5.74 (+2.05%)
286.49 USD
+0.63 (+0.22%)
Overall WTS gets a fundamental rating of 6 out of 10. We evaluated WTS against 128 industry peers in the Machinery industry. Both the health and profitability get an excellent rating, making WTS a very profitable company, without any liquidiy or solvency issues. 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.
In the past year WTS had a positive cash flow from operations.
Each year in the past 5 years WTS has been profitable.
Each year in the past 5 years WTS had a positive operating cash flow.
1.2 Ratios
WTS's Return On Assets of 11.78% is amongst the best of the industry. WTS outperforms 87.50% of its industry peers.
The Return On Equity of WTS (16.47%) is better than 78.91% of its industry peers.
Looking at the Return On Invested Capital, with a value of 14.92%, WTS belongs to the top of the industry, outperforming 86.72% of the companies in the same industry.
WTS had an Average Return On Invested Capital over the past 3 years of 14.98%. This is above the industry average of 10.02%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.78% | ||
| ROE | 16.47% | ||
| ROIC | 14.92% |
ROA(3y)12.17%
ROA(5y)10.41%
ROE(3y)17.9%
ROE(5y)15.7%
ROIC(3y)14.98%
ROIC(5y)13.71%
1.3 Margins
Looking at the Profit Margin, with a value of 13.63%, WTS belongs to the top of the industry, outperforming 84.38% of the companies in the same industry.
In the last couple of years the Profit Margin of WTS has grown nicely.
WTS's Operating Margin of 18.88% is amongst the best of the industry. WTS outperforms 87.50% of its industry peers.
WTS's Operating Margin has improved in the last couple of years.
With an excellent Gross Margin value of 48.48%, WTS belongs to the best of the industry, outperforming 92.19% of the companies in the same industry.
In the last couple of years the Gross Margin of WTS has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 18.88% | ||
| PM (TTM) | 13.63% | ||
| GM | 48.48% |
OM growth 3Y7.25%
OM growth 5Y7.01%
PM growth 3Y12.18%
PM growth 5Y9.49%
GM growth 3Y3.61%
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.
WTS has less shares outstanding than it did 5 years ago.
The debt/assets ratio for WTS has been reduced compared to a year ago.
2.2 Solvency
WTS has an Altman-Z score of 10.04. This indicates that WTS is financially healthy and has little risk of bankruptcy at the moment.
The Altman-Z score of WTS (10.04) is better than 92.19% of its industry peers.
The Debt to FCF ratio of WTS is 0.62, which is an excellent value as it means it would take WTS, only 0.62 years of fcf income to pay off all of its debts.
WTS has a better Debt to FCF ratio (0.62) than 89.84% of its industry peers.
WTS has a Debt/Equity ratio of 0.10. This is a healthy value indicating a solid balance between debt and equity.
The Debt to Equity ratio of WTS (0.10) is better than 78.13% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.1 | ||
| Debt/FCF | 0.62 | ||
| Altman-Z | 10.04 |
ROIC/WACC1.51
WACC9.89%
2.3 Liquidity
WTS has a Current Ratio of 2.59. This indicates that WTS is financially healthy and has no problem in meeting its short term obligations.
With a decent Current ratio value of 2.59, WTS is doing good in the industry, outperforming 68.75% of the companies in the same industry.
WTS has a Quick Ratio of 1.63. This is a normal value and indicates that WTS is financially healthy and should not expect problems in meeting its short term obligations.
The Quick ratio of WTS (1.63) is better than 71.09% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.59 | ||
| Quick Ratio | 1.63 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 8.41% over the past year.
WTS shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 16.86% yearly.
The Revenue has been growing slightly by 2.96% in the past year.
The Revenue has been growing slightly by 7.07% on average over the past years.
EPS 1Y (TTM)8.41%
EPS 3Y17.06%
EPS 5Y16.86%
EPS Q2Q%25.61%
Revenue 1Y (TTM)2.96%
Revenue growth 3Y7.57%
Revenue growth 5Y7.07%
Sales Q2Q%7.77%
3.2 Future
The Earnings Per Share is expected to grow by 8.61% on average over the next years. This is quite good.
WTS is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 5.08% yearly.
EPS Next Y11.36%
EPS Next 2Y9.31%
EPS Next 3Y8.28%
EPS Next 5Y8.61%
Revenue Next Year4.18%
Revenue Next 2Y4.27%
Revenue Next 3Y4.13%
Revenue Next 5Y5.08%
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 decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 29.96, which means the current valuation is very expensive for WTS.
Compared to the rest of the industry, the Price/Earnings ratio of WTS is on the same level as its industry peers.
WTS's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 27.41.
A Price/Forward Earnings ratio of 26.97 indicates a quite expensive valuation of WTS.
Based on the Price/Forward Earnings ratio, WTS is valued a bit more expensive than the industry average as 61.72% of the companies are valued more cheaply.
When comparing the Price/Forward Earnings ratio of WTS to the average of the S&P500 Index (22.88), we can say WTS is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 29.96 | ||
| Fwd PE | 26.97 |
4.2 Price Multiples
WTS's Enterprise Value to EBITDA is on the same level as the industry average.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of WTS is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 30.09 | ||
| EV/EBITDA | 19.21 |
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)2.64
PEG (5Y)1.78
EPS Next 2Y9.31%
EPS Next 3Y8.28%
5. Dividend
5.1 Amount
With a yearly dividend of 0.75%, WTS is not a good candidate for dividend investing.
WTS's Dividend Yield is comparable with the industry average which is at 1.74.
With a Dividend Yield of 0.75, WTS pays less dividend than the S&P500 average, which is at 2.38.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.75% |
5.2 History
The dividend of WTS is nicely growing with an annual growth rate of 12.49%!
WTS has been paying a dividend for at least 10 years, so it has a reliable track record.
WTS has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)12.49%
Div Incr Years12
Div Non Decr Years23
5.3 Sustainability
19.51% of the earnings are spent on dividend by WTS. This is a low number and sustainable payout ratio.
WTS's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP19.51%
EPS Next 2Y9.31%
EPS Next 3Y8.28%
285.86
+5.74 (+2.05%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)
Earnings (Next)
Inst Owners101.47%
Inst Owner Change1.42%
Ins Owners1.05%
Ins Owner Change-2.29%
Market Cap9.54B
Analysts71.43
Price Target276.45 (-3.29%)
Short Float %2.92%
Short Ratio3.83
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.75% |
Yearly Dividend1.67
Dividend Growth(5Y)12.49%
DP19.51%
Div Incr Years12
Div Non Decr Years23
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)13.13%
Min EPS beat(2)10.75%
Max EPS beat(2)15.5%
EPS beat(4)4
Avg EPS beat(4)8.44%
Min EPS beat(4)1.22%
Max EPS beat(4)15.5%
EPS beat(8)8
Avg EPS beat(8)8.48%
EPS beat(12)12
Avg EPS beat(12)9.65%
EPS beat(16)16
Avg EPS beat(16)10.87%
Revenue beat(2)2
Avg Revenue beat(2)2.54%
Min Revenue beat(2)0.9%
Max Revenue beat(2)4.19%
Revenue beat(4)2
Avg Revenue beat(4)0.99%
Min Revenue beat(4)-0.73%
Max Revenue beat(4)4.19%
Revenue beat(8)6
Avg Revenue beat(8)1.22%
Revenue beat(12)9
Avg Revenue beat(12)0.98%
Revenue beat(16)13
Avg Revenue beat(16)1.81%
PT rev (1m)9.64%
PT rev (3m)17.43%
EPS NQ rev (1m)0.17%
EPS NQ rev (3m)3.37%
EPS NY rev (1m)4.6%
EPS NY rev (3m)5.4%
Revenue NQ rev (1m)0.24%
Revenue NQ rev (3m)3.37%
Revenue NY rev (1m)2.25%
Revenue NY rev (3m)2.65%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 29.96 | ||
| Fwd PE | 26.97 | ||
| P/S | 4.17 | ||
| P/FCF | 30.09 | ||
| P/OCF | 26.86 | ||
| P/B | 5.04 | ||
| P/tB | 11.11 | ||
| EV/EBITDA | 19.21 |
EPS(TTM)9.54
EY3.34%
EPS(NY)10.6
Fwd EY3.71%
FCF(TTM)9.5
FCFY3.32%
OCF(TTM)10.64
OCFY3.72%
SpS68.52
BVpS56.73
TBVpS25.73
PEG (NY)2.64
PEG (5Y)1.78
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.78% | ||
| ROE | 16.47% | ||
| ROCE | 19.83% | ||
| ROIC | 14.92% | ||
| ROICexc | 17.96% | ||
| ROICexgc | 41.98% | ||
| OM | 18.88% | ||
| PM (TTM) | 13.63% | ||
| GM | 48.48% | ||
| FCFM | 13.86% |
ROA(3y)12.17%
ROA(5y)10.41%
ROE(3y)17.9%
ROE(5y)15.7%
ROIC(3y)14.98%
ROIC(5y)13.71%
ROICexc(3y)18.57%
ROICexc(5y)16.78%
ROICexgc(3y)44.6%
ROICexgc(5y)41.23%
ROCE(3y)19.91%
ROCE(5y)18.23%
ROICexcg growth 3Y4.4%
ROICexcg growth 5Y1.57%
ROICexc growth 3Y5.14%
ROICexc growth 5Y6.09%
OM growth 3Y7.25%
OM growth 5Y7.01%
PM growth 3Y12.18%
PM growth 5Y9.49%
GM growth 3Y3.61%
GM growth 5Y2.18%
F-Score8
Asset Turnover0.86
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.1 | ||
| Debt/FCF | 0.62 | ||
| Debt/EBITDA | 0.4 | ||
| Cap/Depr | 68.34% | ||
| Cap/Sales | 1.67% | ||
| Interest Coverage | 40.72 | ||
| Cash Conversion | 72.84% | ||
| Profit Quality | 101.7% | ||
| Current Ratio | 2.59 | ||
| Quick Ratio | 1.63 | ||
| Altman-Z | 10.04 |
F-Score8
WACC9.89%
ROIC/WACC1.51
Cap/Depr(3y)68.09%
Cap/Depr(5y)71.53%
Cap/Sales(3y)1.48%
Cap/Sales(5y)1.76%
Profit Quality(3y)99.01%
Profit Quality(5y)110.38%
High Growth Momentum
Growth
EPS 1Y (TTM)8.41%
EPS 3Y17.06%
EPS 5Y16.86%
EPS Q2Q%25.61%
EPS Next Y11.36%
EPS Next 2Y9.31%
EPS Next 3Y8.28%
EPS Next 5Y8.61%
Revenue 1Y (TTM)2.96%
Revenue growth 3Y7.57%
Revenue growth 5Y7.07%
Sales Q2Q%7.77%
Revenue Next Year4.18%
Revenue Next 2Y4.27%
Revenue Next 3Y4.13%
Revenue Next 5Y5.08%
EBIT growth 1Y13.7%
EBIT growth 3Y15.37%
EBIT growth 5Y14.57%
EBIT Next Year20.19%
EBIT Next 3Y10.24%
EBIT Next 5Y10.86%
FCF growth 1Y25.26%
FCF growth 3Y28.35%
FCF growth 5Y14.6%
OCF growth 1Y27%
OCF growth 3Y25.93%
OCF growth 5Y13.23%