A. O. Smith (NYSE:AOS) Posts Quarterly Earnings Results, Beats Expectations By $0.06 EPS

A. O. Smith (NYSE:AOS) announced its quarterly earnings results on Thursday. The industrial products company reported $0.90 EPS for the quarter, beating analysts’ consensus estimates of $0.84 by $0.06, FiscalAI reports. The firm had revenue of $912.50 million during the quarter, compared to the consensus estimate of $928.97 million. A. O. Smith had a net margin of 13.85% and a return on equity of 29.34%. The firm’s revenue for the quarter was up .0% compared to the same quarter last year. During the same quarter last year, the firm earned $0.85 EPS.

Here are the key takeaways from A. O. Smith’s conference call:

• Company delivered a record adjusted EPS of $3.85 in 2025 (up 6%), drove margin expansion across segments, generated strong free cash flow of $546 million (100% conversion), and returned $597 million to shareholders.
• Completed the acquisition of Leonard Valve to enter the water management market and bolster connected/digital capabilities, with management expecting ~ $70 million of Leonard sales in 2026.
• The Leonard Valve deal was funded with about $470 million of new debt, increasing 2026 interest expense (guidance $30–40 million) and raising leverage, which could constrain near-term financial flexibility.
• China remains a headwind—third‑party sales fell ~12% in 2025 and management expects mid‑single‑digit declines in 2026 with first‑half pressure from lapped subsidies and weak consumer demand while a strategic review of China options continues.
• North America water treatment improved profitability materially (≈400 bps YoY to ~13% operating margin) and management expects further margin expansion (~200 bps) and mid‑to‑high single‑digit/top‑line growth in boilers and water treatment in 2026.

A. O. Smith Stock Up 6.4%

Shares of NYSE:AOS traded up $4.42 during trading on Thursday, reaching $73.91. The stock had a trading volume of 1,316,097 shares, compared to its average volume of 1,289,850. The firm’s 50-day simple moving average is $68.46 and its 200 day simple moving average is $69.64. The company has a current ratio of 1.54, a quick ratio of 0.95 and a debt-to-equity ratio of 0.09. A. O. Smith has a one year low of $58.83 and a one year high of $77.31. The company has a market capitalization of $10.29 billion, a P/E ratio of 19.94, a PEG ratio of 1.43 and a beta of 1.35.

A. O. Smith Announces Dividend

The company also recently announced a quarterly dividend, which will be paid on Tuesday, February 17th. Shareholders of record on Friday, January 30th will be issued a $0.36 dividend. The ex-dividend date is Friday, January 30th. This represents a $1.44 dividend on an annualized basis and a yield of 1.9%. A. O. Smith’s payout ratio is currently 38.81%.

Analysts Set New Price Targets

Several equities research analysts have recently issued reports on the stock. DA Davidson restated a “neutral” rating and issued a $75.00 target price on shares of A. O. Smith in a report on Thursday, November 13th. Wall Street Zen raised shares of A. O. Smith from a “hold” rating to a “buy” rating in a research note on Saturday, October 18th. Jefferies Financial Group set a $75.00 target price on A. O. Smith and gave the company a “hold” rating in a research note on Friday, January 9th. Stifel Nicolaus set a $80.00 price target on A. O. Smith and gave the stock a “buy” rating in a report on Wednesday, October 29th. Finally, Robert W. Baird set a $76.00 price objective on A. O. Smith in a report on Wednesday, October 29th. Two investment analysts have rated the stock with a Buy rating and seven have issued a Hold rating to the stock. According to data from MarketBeat.com, A. O. Smith currently has an average rating of “Hold” and an average target price of $76.50.

Institutional Investors Weigh In On A. O. Smith

A number of large investors have recently modified their holdings of AOS. Fiduciary Trust Co increased its stake in A. O. Smith by 5.0% during the 3rd quarter. Fiduciary Trust Co now owns 4,072 shares of the industrial products company’s stock valued at $299,000 after purchasing an additional 193 shares in the last quarter. Larson Financial Group LLC increased its position in shares of A. O. Smith by 67.9% in the 3rd quarter. Larson Financial Group LLC now owns 487 shares of the industrial products company’s stock valued at $36,000 after acquiring an additional 197 shares during the period. Polymer Capital Management US LLC grew its stake in A. O. Smith by 7.8% during the 3rd quarter. Polymer Capital Management US LLC now owns 5,265 shares of the industrial products company’s stock valued at $387,000 after purchasing an additional 382 shares during the last quarter. Glenmede Investment Management LP increased its holdings in shares of A. O. Smith by 11.3% in the third quarter. Glenmede Investment Management LP now owns 4,075 shares of the industrial products company’s stock valued at $299,000 after purchasing an additional 414 shares during the period. Finally, EverSource Wealth Advisors LLC raised its stake in shares of A. O. Smith by 78.0% in the second quarter. EverSource Wealth Advisors LLC now owns 963 shares of the industrial products company’s stock worth $63,000 after purchasing an additional 422 shares during the last quarter. Hedge funds and other institutional investors own 76.10% of the company’s stock.

More A. O. Smith News

Here are the key news stories impacting A. O. Smith this week:

• Positive Sentiment: Q4 EPS beat — AOS reported $0.90 EPS vs. a $0.84 consensus, topping estimates and showing modest year-over-year EPS growth; investors often reward beats with upward price moves. A.O. Smith (AOS) Q4 Earnings Beat Estimates
• Positive Sentiment: Record 2025 results and shareholder returns — management reported record 2025 diluted EPS of $3.85, strong free cash flow (~$546M) and returned $597M to shareholders via dividends and buybacks, supporting shareholder-friendly narratives. A. O. Smith Reports Record 2025 Diluted Earnings Per Share (EPS) of $3.85 and Introduces 2026 Guidance
• Positive Sentiment: Acquisition closed — the Leonard Valve acquisition closed in January 2026, expanding AOS’s water-management footprint; strategic M&A can boost medium-term growth prospects. A. O. Smith Reports Record 2025 Diluted Earnings Per Share (EPS) of $3.85 and Introduces 2026 Guidance
• Neutral Sentiment: Management materials available — the company posted its press release, slide deck and conference materials for the quarter, useful for digging into guidance and segment-level detail. View Press Release / Slide Deck
• Neutral Sentiment: Analyst previews flagged mixed drivers — previews expected North American strength and contribution from acquisitions but noted potential headwinds from China and cost pressures; this frames why revenue and margin details will matter to investors. A. O. Smith Gears Up to Report Q4 Earnings: What to Expect?
• Negative Sentiment: Revenue slightly missed — revenue was $912.5M vs. ~$929M consensus and essentially flat year-over-year, which could temper enthusiasm if investors focus on top-line momentum rather than EPS/rate improvement. View Press Release / Slide Deck

About A. O. Smith

A. O. Smith Corporation, based in Milwaukee, Wisconsin, is a leading manufacturer of water heating and water treatment products for residential and commercial applications. Since its founding in 1874, the company has built a reputation for producing reliable, energy-efficient water heaters, boilers and pressure vessels. Its product portfolio encompasses gas, electric, condensing and tankless water heaters, as well as specialty boilers designed to meet a variety of building and industrial needs.

The company operates through two primary segments: North America and Asia.