NYSEIndustrialsIndustrial - MachinerySnapshot 2026-08-31
Reading AOS? Create a free portfolio, then add this holding for ongoing Reports and tracking. Track it in a free portfolio. No credit card.
Create your account →Warn: Primary pillar under pressure — Consolidated revenue near $3.96B in FY26: FY26 revenue guidance $3.90B-$3.95B vs $3.96B target.
A. O. Smith leads North America in water heaters. Revenue is expected near $3.96B in 2026, growing about 4.8%. Profit per share is guided at $3.8, showing solid earnings. The company manages China challenges and invests in new products.
Sales in China fell 12% in 2025 and remain weak. The company missed Q1 2026 earnings and lowered full-year EPS guidance. Growth is slow and market conditions are tough, risking further profit cuts.
The stock trades about 7% below our fair value near $66. Analysts expect about 5% revenue growth. Our fair value is 12% below the Street median, reflecting cautious optimism versus peers.
Breaks if: China sales decline worsens beyond -12% in FY26
Breaks if: EPS falls below $3.60 in FY26
This is not a price target or investment advice.
A long-form read on the 1–3 year hold thesis. It updates when the weekly evidence changes.
This investment represents a stable company with a focus on gradual growth and shareholder returns. The current thesis state is intact, despite some challenges in execution and market conditions.
The market currently prices AOS as cheap compared to its peers, reflecting a low expectations gap. There is a recognition of the company's fragility due to weak execution quality, but this is not fully reflected in the stock's pricing.
Fundamentals are likely to remain neutral in the near term, as management is behind on key priorities like sales growth and addressing challenges in China. However, the company is on track with its share repurchase program, supported by strong cash flow.
The long-term thesis hinges on management's ability to improve execution and navigate market challenges, particularly in China. Additionally, the performance of sector bellwethers will be crucial, as their results could impact AOS's momentum.
The most important moves since the prior daily snapshot.
Mixed, the news cuts both ways. AOS increased consolidated sales by 2% to 5%. It also raised its share repurchase target to $300 million in 2026. However, the company faces challenging conditions in the China market. This weakness could impact management's growth objectives.
as of 2026-08-31
Review the evidence to watch, what would become a concern, and what would make it less concerning.
Not investment advice. Scores describe historical and current data; they are not forecasts of future returns. Consult a licensed advisor before making investment decisions.
A. O. Smith has lowered its full-year 2026 EPS outlook due to continued challenging conditions.
Breaks if: Revenue falls below $3.85B in FY26
Over the next 1 to 3 years, AOS's performance will depend on its execution and external market conditions. Not investment advice.
