Track market-moving stories before they get noisy

A. O. Smith is rated Buy due to resilient replacement demand, energy-efficiency tailwinds, and an attractive valuation. Approximately 80-85% of North American water heater demand is replacement-driven, providing downside protection and medium-term growth potential. Earnings are expected to recover from Q4 2026, driven by pricing realization, cost savings, and a favorable product mix shift.

Posted by Defense World Staff on Aug 6th, 2026

Amundi decreased its position in shares of A. O. Smith Corporation (NYSE:AOS – Free Report) by 86.4% in the first quarter, according to the company in its most recent disclosure with the Securities and Exchange Commission. The fund owned 115,540 shares of the industrial products company’s stock after selling 733,620 shares during the period. Amundi owned 0.08% of A. O. Smith worth $7,619,000 at the end of the most recent reporting period.

A number of other institutional investors and hedge funds have also recently bought and sold shares of the company. Creative Financial Designs Inc. ADV increased its holdings in A. O. Smith by 3,481.8% in the fourth quarter. Creative Financial Designs Inc. ADV now owns 394 shares of the industrial products company’s stock worth $26,000 after buying an additional 383 shares during the last quarter. Torren Management LLC acquired a new stake in A. O. Smith in the fourth quarter valued at approximately $31,000. Eagle Bay Advisors LLC bought a new stake in A. O. Smith in the fourth quarter worth approximately $32,000. Larson Financial Group LLC grew its position in A. O. Smith by 67.9% in the third quarter. Larson Financial Group LLC now owns 487 shares of the industrial products company’s stock worth $36,000 after acquiring an additional 197 shares in the last quarter. Finally, Los Angeles Capital Management LLC acquired a new position in shares of A. O. Smith during the 4th quarter worth $35,000. Hedge funds and other institutional investors own 76.10% of the company’s stock.

Analyst Upgrades and Downgrades A number of analysts have weighed in on AOS shares. Zacks Research cut A. O. Smith from a “hold” rating to a “strong sell” rating in a research report on Wednesday, May 6th. Weiss Ratings lowered A. O. Smith from a “hold (c)” rating to a “hold (c-)” rating in a report on Wednesday, May 27th. Citigroup cut their price objective on A. O. Smith from $65.00 to $64.00 and set a “neutral” rating on the stock in a research note on Friday, July 31st. Robert W. Baird set a $70.00 target price on A. O. Smith in a report on Friday, May 1st. Finally, The Goldman Sachs Group decreased their target price on A. O. Smith from $69.00 to $61.00 and set a “sell” rating for the company in a research report on Monday, April 13th. Two analysts have rated the stock with a Buy rating, four have assigned a Hold rating and three have assigned a Sell rating to the company’s stock. According to MarketBeat, the company has an average rating of “Reduce” and a consensus target price of $67.75.

Check Out Our Latest Analysis on A. O. Smith

A. O. Smith Price Performance NYSE:AOS opened at $63.14 on Thursday. The stock has a market cap of $8.70 billion, a P/E ratio of 17.54, a PEG ratio of 1.41 and a beta of 1.17. A. O. Smith Corporation has a one year low of $54.16 and a one year high of $81.86. The company has a fifty day moving average price of $59.83 and a 200 day moving average price of $65.17. The company has a debt-to-equity ratio of 0.32, a current ratio of 1.59 and a quick ratio of 1.04.

A. O. Smith (NYSE:AOS – Get Free Report) last posted its quarterly earnings results on Thursday, July 30th. The industrial products company reported $1.03 earnings per share (EPS) for the quarter, topping the consensus estimate of $0.96 by $0.07. A. O. Smith had a net margin of 13.15% and a return on equity of 27.88%. The company had revenue of $1 billion for the quarter, compared to analyst estimates of $994.89 million. During the same period last year, the business posted $1.07 EPS. The business’s quarterly revenue was down .7% on a year-over-year basis. A. O. Smith has set its FY 2026 guidance at 3.700-3.850 EPS. Analysts anticipate that A. O. Smith Corporation will post 3.74 earnings per share for the current year.

A. O. Smith Announces Dividend The company also recently declared a quarterly dividend, which will be paid on Monday, August 17th. Shareholders of record on Friday, July 31st will be issued a $0.36 dividend. The ex-dividend date of this dividend is Friday, July 31st. This represents a $1.44 annualized dividend and a yield of 2.3%. A. O. Smith’s dividend payout ratio is 40.00%.

A. O. Smith Profile (Free Report)

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.

See Also Five stocks we like better than A. O. Smith SpaceX: Love the Company, But the Stock Is a Harder Call Ulta’s Growth Is Real, But So Are the Risks BWX Technologies Is Turning the AI Power Problem Into a Nuclear Growth Story Meta’s Earnings Drop Shows Wall Street Wants More Than Ad Growth Want to see what other hedge funds are holding AOS? Visit HoldingsChannel.com to get the latest 13F filings and insider trades for A. O. Smith Corporation (NYSE:AOS – Free Report).

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A. O. Smith Corporation (AOS) Q2 2026 Earnings Call July 30, 2026 10:00 AM EDT

Company Participants

Helen Gurholt - Vice President of Investor Relations and Financial Planning & Analysis
Stephen Shafer - President, CEO & Chairman
Charles Lauber - Executive Vice President
Carrie Anderson - Executive VP & CFO

Conference Call Participants

Bryan Blair - Oppenheimer & Co. Inc., Research Division
Michael Halloran - Robert W. Baird & Co. Incorporated, Research Division
Nathan Jones - Stifel, Nicolaus & Company, Incorporated, Research Division
Scott Graham - Seaport Research Partners
Brendan Shea - JPMorgan Chase & Co, Research Division
Mitchell Moore - KeyBanc Capital Markets Inc., Research Division
Joseph Nolan - Longbow Research LLC
Ryan Connors - Northcoast Research Partners, LLC
Susan Maklari - Goldman Sachs Group, Inc., Research Division
Pratap Singh - UBS Investment Bank, Research Division

Presentation

Operator

Good day, and thank you for standing by. Welcome to the Second Quarter 2026 Earnings Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded.

I would now like to turn the conference over to your speaker today, Helen Gurholt. Please go ahead.

Helen Gurholt
Vice President of Investor Relations and Financial Planning & Analysis

Thank you, Lisa. Good morning, everyone, and welcome to the A. O. Smith second quarter conference call. I'm Helen Gurholt, Vice President, Investor Relations and Financial Planning and Analysis. Joining me today are Steve Shafer, Chief Executive Officer; Chuck Lauber, Executive Vice President; and Carrie Anderson, Chief Financial Officer.

In order to provide improved transparency into the operating results of our business, we provided non-GAAP measures. Free cash flow is defined as cash from operations less capital expenditures. North America segment organic growth excludes the impact of Leonard Valve. Adjusted earnings, adjusted earnings per share and adjusted segment earnings exclude the impact of restructuring and impairment expenses.

Reconciliations from GAAP measures to non-GAAP

For the quarter ended June 2026, A.O. Smith (AOS - Free Report) reported revenue of $1 billion, down 0.7% over the same period last year. EPS came in at $1.03, compared to $1.07 in the year-ago quarter.

The reported revenue compares to the Zacks Consensus Estimate of $986.45 million, representing a surprise of +1.81%. The company delivered an EPS surprise of +7.29%, with the consensus EPS estimate being $0.96.

While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and how they compare to Wall Street expectations to determine their next course of action, some key metrics always provide a better insight into a company's underlying performance.

As these metrics influence top- and bottom-line performance, comparing them to the year-ago numbers and what analysts estimated helps investors project a stock's price performance more accurately.

Here is how A.O. Smith performed in the just reported quarter in terms of the metrics most widely monitored and projected by Wall Street analysts:

Geographic Revenue- North America: $820.5 million versus the five-analyst average estimate of $809.06 million. The reported number represents a year-over-year change of +5.3%.Geographic Revenue- Rest of World: $194.9 million versus $187.52 million estimated by five analysts on average. Compared to the year-ago quarter, this number represents a -18.8% change.Geographic Revenue- Inter-segment sales: $-11.1 million versus the four-analyst average estimate of $-7.03 million. The reported number represents a year-over-year change of +42.3%.View all Key Company Metrics for A.O. Smith here>>>

Shares of A.O. Smith have returned -0.2% over the past month versus the Zacks S&P 500 composite's -1.5% change. The stock currently has a Zacks Rank #4 (Sell), indicating that it could underperform the broader market in the near term.

Second Quarter 2026 Highlights
(Comparisons are year-over-year ("YoY"), unless otherwise noted)

Sales of $1 billion; net earnings of $125 million and diluted earnings per share (EPS) of $0.91; adjusted earnings of $142 million1 and adjusted EPS of $1.031 North America segment sales of $820.5 million increased 5% driven by the Leonard Valve acquisition, 21% boiler sales growth and carryover pricing actions, partially offset by lower residential water heater volumes Rest of World segment sales of $194.9 million decreased 19%, reflecting continued weakness in China's consumer appliance market Year-to-date operating cash flow increased 42% to $254 million and free cash flow increased 67% to $233 million 2026 full year share repurchase target increased to $300 million 2026 full year sales EPS guidance updated to: Sales growth of between 2% and 3% Diluted EPS of between $3.60 and $3.75 Adjusted EPS of between $3.70 and $3.85 1

Adjusted earnings and adjusted EPS exclude the impact of restructuring and impairment expenses associated with targeted restructuring actions taken in the North America water treatment business.

, /PRNewswire/ -- Global water technology company A. O. Smith Corporation ("the Company") (NYSE: AOS) today announced its second quarter 2026 results.

Key Financial Metrics 

Second Quarter
(in millions, except per share amounts)

Q2 2026

Q2 2025

% Change YoY

Net sales

$   1,004.3

$ 1,011.3

-1 %

Net earnings

$      124.9

$    152.2

-18 %

Adjusted earnings

 $     142.02

$    152.2

-7 %

Diluted earnings per share

$        0.91

$      1.07

-15 %

Adjusted earnings per share

$      1.032

$      1.07

-4 %

2   

Excludes North America water treatment pre-tax restructuring and impairment expenses of $22.6 million. See accompanying GAAP to Non-GAAP reconciliations

"Our team continued to execute well in the second quarter, demonstrating the resilience of the A. O. Smith team and our business model," said Steve Shafer, chairman and chief executive officer. "While North America continued to face softer residential water heater demand, we are pleased with the progress we are making in our market share, as well as the strong growth in our boiler business. Operational excellence and delivering for our customers remained key priorities throughout the quarter. In China, we managed through a significantly weaker market environment and continue our strategic assessment of the business. We remain committed to disciplined execution and investing in opportunities that will strengthen our competitive position and drive long-term value creation."

Segment-level Performance

North America

Second quarter sales increased 5% to $820.5 million, driven by higher boiler volumes, the benefits of carryover pricing and a $16 million sales contribution from Leonard Valve, acquired in January 2026, partially offset by lower residential water heater volumes. Excluding Leonard Valve, organic sales increased 3%.

Segment earnings were $177.2 million, and segment margin was 21.6% in the second quarter of 2026 compared to second quarter of 2025 segment earnings of $198.1 million and segment margin of 25.4%. Second quarter 2026 adjusted segment earnings and adjusted segment margin were $199.8 million and 24.4%, respectively, and exclude $22.6 million of restructuring and impairment expenses associated with a restructuring plan designed to improve profitability and accelerate growth through footprint optimization and brand rationalization in our North America water treatment business. Beginning in 2027, annual savings associated with these restructuring actions are projected to be approximately $6 million to $8 million. The year-over-year decrease in segment earnings and segment margin was primarily due to restructuring and impairment expenses. Adjusted segment earnings were slightly higher with a decrease in adjusted segment margin, primarily due to higher steel and other input costs largely offsetting realized pricing in the quarter.

Rest of World

Rest of World sales of $194.9 million decreased 19% compared to the prior year period and included a favorable currency translation impact of $6 million primarily related to sales in China. China sales decreased 28% in local currency due to continued weak consumer demand and a challenging market environment.

Segment earnings were $10.2 million, and segment margin was 5.2% in the second quarter of 2026, compared to segment earnings of $25.3 million and segment margin of 10.5% in the same period of 2025. The lower segment earnings and segment margin compared to the prior year were primarily due to lower China sales volumes which were partially offset by continued cost management.

Balance Sheet, Liquidity and Capital Allocation

As of June 30, 2026, cash balances totaled $181.3 million and debt totaled $637.5 million, resulting in a leverage ratio of 25.7% as measured by total debt-to-total capitalization. The increased leverage ratio compared to 2025 was due to cash borrowed under a new term loan used to acquire Leonard Valve in January 2026.

Cash provided by operations was $253.8 million and free cash flow was $233.3 million in the first half of 2026, up 42% and 67%, respectively, versus the prior year period, primarily driven by working capital management that more than offset lower earnings.

As part of its commitment to return capital to shareholders, the Company deployed $162.4 million to repurchase 2.6 million shares in the first half of 2026. As of June 30, 2026, authority remained to repurchase approximately 3.2 million additional shares. Supported by strong cash flow performance in the first half of the year, the Company increased its full-year 2026 share repurchase target by 50% to $300 million from $200 million.

On July 13, 2026, the Company's board of directors approved a quarterly cash dividend of $0.36 per share for shareholders of record on July 31, payable on August 17. For the full release, click here.

Outlook

2026 Outlook
(in millions, except per share amounts)

2025

2026 Outlook

Actual

Low End

High End

Net sales

$  3,830

$    3,900

$    3,950

Diluted earnings per share

$    3.85

$      3.60

$      3.75

Adjusted earnings per share

$    3.85

    $    3.703

   $    3.853

3   

Excludes North America water treatment pre-tax restructuring and impairment expenses of approximately $20 million, of which $22.6 million was recognized in the second quarter. Anticipated proceeds from the sale of certain assets are expected to occur in late 2026. See accompanying GAAP to Non-GAAP reconciliations

Due to continued softness in residential water heater industry volumes, the Company narrowed its full-year 2026 sales growth outlook to a range of 2% to 3%, compared to its previous range of 2% to 4%. The Company also narrowed its full-year 2026 adjusted EPS outlook to be between $3.70 and $3.85, from $3.70 to $4.00.

Shafer concluded, "While residential water heater demand remains soft, we are confident in our business fundamentals, competitive position and ability to execute our strategy. Our strong cash flow generation underscores the resilience of our operating model and supports disciplined capital deployment, including our decision to increase the full-year share repurchase target by 50% as we continue returning value to shareholders."

The Company's guidance excludes the potential impacts from future acquisitions, any potential outcomes of the assessment of its China business and the potential impact of the recently announced changes in tariff policy.

A. O. Smith will host a webcasted conference call at 10:00 a.m. (Eastern Daylight Time) today. The call can be heard live on the Company's website click here. An audio replay of the call will be available on the Company's website after the live event. To access the archived audio replay, go to the "Investors" page and select the Second Quarter 2026 Earnings Call link.

To provide improved transparency into the operating results of its business, the Company is providing non-GAAP measures. Free cash flow is defined as cash provided by operations less capital expenditures. North America segment organic growth excludes the impact of Leonard Valve. Adjusted earnings, adjusted EPS and adjusted segment earnings exclude the impact of restructuring and impairment charges. Reconciliations from GAAP measures to non-GAAP measures are provided in the financial information included in this news release.

Forward-looking Statements

This release contains statements that the Company believes are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements generally can be identified by the use of words such as "may," "will," "expect," "intend," "estimate," "anticipate," "believe," "forecast," "continue," "guidance," "outlook", "confident" or words of similar meaning. All forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those anticipated as of the date of this release. Important factors that could cause actual results to differ materially from these expectations include, among other things, the following: further softening in U.S. residential and commercial water heater demand; further weakening in North American residential or commercial construction or instability in the Company's replacement markets; failure to realize the expected benefits of acquisitions or expected synergies; difficulties in predicting results of operations of an acquired business; negative impact to the Company's businesses from international tariffs, including any new or increased tariffs that could also trigger retaliatory responses from other countries, as well as trade disputes and geopolitical differences, including the conflicts in Ukraine and the Middle East; negative impacts to the Company, particularly the demand for its products, resulting from global inflationary pressures or a potential recession in one or more of the markets in which the Company participates; the Company's ability to continue to obtain commodities, components, parts and accessories on a timely basis through its supply chain and at expected costs, including the recent volatility in fuel and other material prices; inability of the Company to implement or maintain pricing actions; inconsistent recovery of the Chinese economy or a further decline in the growth rate of consumer spending or housing sales in China; the availability, timing or effects of China stimulus programs; uncertain outcomes and costs and other potential impacts of the Company's assessment relating to the Company's China business; the failure to realize the expected benefits of restructuring actions; further weakening in the high-efficiency gas boiler segment in the U.S.; substantial defaults in payment by, material reduction in purchases by or the loss, bankruptcy or insolvency of a major customer; foreign currency fluctuations; failure to realize the expected benefits, timing and extent of regulatory changes; competitive pressures on the Company's businesses, including new technologies and new competitors; the impact of potential information technology or data security breaches; negative impact of changes in government regulations or regulatory requirements; the inability to respond to secular trends toward decarbonization and energy efficiency; and adverse developments in general economic, political and business conditions in key regions of the world. Additional factors are discussed in the Company's filings with Securities and Exchange Commission, including the Company's Annual Report on Form 10-K for the year ended December 31, 2025, quarterly reports on Form 10-Q and current reports on Form 8-K. Forward-looking statements included in this news release are made only as of the date of this release, and the Company is under no obligation to update these statements to reflect subsequent events or circumstances. All subsequent written and oral forward-looking statements attributed to the Company, or persons acting on its behalf, are qualified entirely by these cautionary statements.

About A. O. Smith
A. O. Smith Corporation, with headquarters in Milwaukee, Wisconsin, is a global leader applying innovative technology and energy-efficient solutions to products manufactured and marketed worldwide. Listed on the New York Stock Exchange (NYSE: AOS), the Company is one of the world's leading manufacturers of residential and commercial water heating equipment and boilers, as well as a manufacturer of water treatment and water management products. For more information, visit www.aosmith.com.

A. O. SMITH CORPORATION

Condensed Consolidated Statement of Earnings

(dollars in millions, except share data)

(unaudited)

Three Months Ended
June 30,

Six Months Ended
June 30,

2026

2025

2026

2025

Net sales

$

1,004.3

$

1,011.3

$

1,949.9

$

1,975.2

Cost of products sold

616.5

614.2

1,196.4

1,202.7

Gross profit

387.8

397.1

753.5

772.5

Selling, general and administrative expenses

197.7

191.3

401.6

383.9

Restructuring and impairment expenses

22.6

—

22.6

—

Interest expense

8.1

4.6

15.2

7.5

Other expense (income), net

1.4

(0.4)

1.4

(1.6)

Earnings before provision for income taxes

158.0

201.6

312.7

382.7

Provision for income taxes

33.1

49.4

69.8

93.9

Net earnings

$

124.9

$

152.2

$

242.9

$

288.8

Diluted earnings per share of common stock(1)

$

0.91

$

1.07

$

1.75

$

2.01

Average common shares outstanding (000's omitted)

137,863

142,484

138,511

143,440

(1)

Earnings per share amounts are calculated discretely and, therefore, may not add up to the total due to rounding.

A. O. SMITH CORPORATION

Condensed Consolidated Balance Sheet

(dollars in millions)

(Unaudited)
June 30,
2026

December 31,
2025

ASSETS:

Cash and cash equivalents

$

181.3

$

174.5

Marketable securities

—

18.7

Receivables

669.8

582.3

Inventories

482.7

479.3

Other current assets

55.5

36.7

Total Current Assets

1,389.3

1,291.5

Net property, plant and equipment

619.0

635.1

Goodwill and other intangibles

1,504.2

1,072.9

Operating lease assets

49.7

46.3

Other assets

82.3

97.0

Total Assets

$

3,644.5

$

3,142.8

LIABILITIES AND STOCKHOLDERS' EQUITY:

Trade payables

$

525.7

$

504.1

Accrued payroll and benefits

74.0

93.6

Accrued liabilities

160.9

147.5

Product warranties

71.6

75.0

Debt due within one year

39.5

42.3

Total Current Liabilities

871.7

862.5

Long-term debt

598.0

112.7

Pension liabilities

7.4

7.4

Operating lease liabilities

39.2

37.1

Other liabilities

286.3

265.1

Stockholders' equity

1,841.9

1,858.0

Total Liabilities and Stockholders' Equity

$

3,644.5

$

3,142.8

A. O. SMITH CORPORATION

Condensed Consolidated Statement of Cash Flows

(dollars in millions)

(unaudited)

Six Months Ended
June 30,

2026

2025

Operating Activities

Net earnings

$

242.9

$

288.8

Adjustments to reconcile net earnings to net cash provided by (used in) operating activities:

Depreciation & amortization

48.5

41.2

Share based compensation expense

9.3

8.6

Deferred income taxes

25.1

(9.1)

Non cash impairment

12.4

—

Net changes in operating assets and liabilities:

Current assets and liabilities

(97.1)

(159.0)

Noncurrent assets and liabilities

12.7

7.8

Cash Provided by Operating Activities

253.8

178.3

Investing Activities

Capital expenditures

(20.5)

(38.4)

Acquisitions

(470.0)

—

Investment in marketable securities

—

(22.6)

Net proceeds from sale of marketable securities

18.7

59.2

Cash Used in Investing Activities

(471.8)

(1.8)

Financing Activities

Proceeds from debt

819.0

611.3

Repayments of debt

(333.2)

(503.1)

Common stock repurchases

(162.4)

(251.3)

Net payments from stock option activity

—

(0.5)

Dividends paid

(99.8)

(97.5)

Cash Provided by (Used in) Financing Activities

223.6

(241.1)

Effect of exchange rate changes on cash and cash equivalents

1.2

2.9

Net increase (decrease) in cash and cash equivalents

6.8

(61.7)

Cash and cash equivalents - beginning of period

174.5

239.6

Cash and Cash Equivalents - End of Period

$

181.3

$

177.9

A. O. SMITH CORPORATION

Business Segments

(dollars in millions)

(unaudited)

Three Months Ended

June 30,

Six Months Ended

June 30,

2026

2025

2026

2025

Net sales

North America

$

820.5

$

779.0

$

1,573.9

$

1,527.7

Rest of World

194.9

240.1

395.6

466.8

Inter-segment sales

(11.1)

(7.8)

(19.6)

(19.3)

$

1,004.3

$

1,011.3

$

1,949.9

$

1,975.2

Earnings

North America(1)

$

177.2

$

198.1

$

352.6

$

383.3

Rest of World

10.2

25.3

22.6

45.0

Inter-segment earnings elimination

—

(0.2)

—

(0.2)

187.4

223.2

375.2

428.1

Corporate expense

(21.3)

(17.0)

(47.3)

(37.9)

Interest expense

(8.1)

(4.6)

(15.2)

(7.5)

Earnings before income taxes

158.0

201.6

312.7

382.7

Provision for incomes taxes

33.1

49.4

69.8

93.9

Net earnings

$

124.9

$

152.2

$

242.9

$

288.8

Additional Information

(1) Adjustments: North America

includes restructuring and impairment of:

$

22.6

$

—

$

22.6

$

—

A. O. SMITH CORPORATION

Adjusted Earnings and Adjusted Earnings Per Share

(dollars in millions, except per share data)

(unaudited)

The following is a reconciliation of net earnings and diluted earnings per share to adjusted earnings (non-GAAP) and
adjusted earnings per share (non-GAAP):

Three Months Ended

June 30,

Six Months Ended

June 30,

2026

2025

2026

2025

Net Earnings (GAAP)

$

124.9

$

152.2

$

242.9

$

288.8

Restructuring and impairment expenses, before tax

22.6

—

22.6

—

Tax effect on above items

(5.5)

—

(5.5)

—

Adjusted Earnings (non-GAAP)

$

142.0

$

152.2

$

260.0

$

288.8

Diluted Earnings Per Share (GAAP)(1)

$

0.91

$

1.07

$

1.75

$

2.01

Restructuring and impairment expenses, per diluted share, before tax

0.16

—

0.16

—

Tax effect on above items per diluted share

(0.04)

—

(0.04)

—

Adjusted Earnings Per Share (non-GAAP)(1)

$

1.03

$

1.07

$

1.87

$

2.01

(1)

Earnings per share amounts are calculated discretely and, therefore, may not add up to the total due to rounding.

A. O. SMITH CORPORATION

Sales Growth (Decline)

(unaudited)

The following table provides the components of net sales growth (decline):

Three Months Ended June 30, 2026

North America

Rest of World

Total

Sales Growth (Decline)

5 %

(19) %

(1) %

     Acquisition Impact(1)

2 %

—

1 %

     Foreign Exchange Impact

— %

3 %

1 %

     Organic Sales Growth (Decline) (non-GAAP)

3 %

(22) %

(3) %

Six Months Ended June 30, 2026

North America

Rest of World

Total

Sales Growth (Decline)

3 %

(15) %

(1) %

     Acquisition Impact(1)

2 %

—

2 %

     Foreign Exchange Impact

— %

3 %

1 %

     Organic Sales Growth (Decline) (non-GAAP)

1 %

(18) %

(4) %

(1)

The acquisition effect includes the sales impact of the Leonard Valve acquisition in 2026.

A. O. SMITH CORPORATION

Adjusted Segment Earnings

(dollars in millions)

(unaudited)

The following is a reconciliation of reported earnings before provision for income taxes to total segment earnings (non-GAAP) and
adjusted segment earnings (non-GAAP):

Three Months Ended

June 30,

Six Months Ended

June 30,

2026

2025

2026

2025

Earnings Before Provision for Income Taxes (GAAP)

$

158.0

$

201.6

$

312.7

$

382.7

Add: Corporate expense

21.3

17.0

47.3

37.9

Add: Interest expense

8.1

4.6

15.2

7.5

Total Segment Earnings (non-GAAP)

$

187.4

$

223.2

$

375.2

$

428.1

North America(1)

$

177.2

$

198.1

$

352.6

$

383.3

Rest of World

10.2

25.3

22.6

45.0

Inter-segment earnings elimination

—

(0.2)

—

(0.2)

Total Segment Earnings (non-GAAP)

$

187.4

$

223.2

$

375.2

$

428.1

Additional Information

(1)North America Segment Earnings

$

177.2

$

198.1

$

352.6

$

383.3

Restructuring and impairment expenses, before tax

22.6

—

22.6

—

Adjusted North America Segment Earnings (non-GAAP)

$

199.8

$

198.1

$

375.2

$

383.3

A. O. SMITH CORPORATION

Free Cash Flow

(dollars in millions)

(unaudited)

The following is a reconciliation of reported cash flow from operating activities to free cash flow (non-GAAP):

Six Months Ended

June 30,

2026

2025

Cash provided by operating activities (GAAP)

$

253.8

$

178.3

Less: Capital expenditures

(20.5)

(38.4)

Free cash flow (non-GAAP)

$

233.3

$

139.9

A. O. SMITH CORPORATION

2026 Adjusted EPS Guidance and 2025 EPS

(unaudited)

The following is a reconciliation of diluted EPS to adjusted EPS (non-GAAP) (all items are net of tax):

2026

Guidance

2025

Diluted EPS (GAAP)

$

3.60-3.75

$

3.85

Restructuring and impairment expenses

0.10

(1)

—

Adjusted EPS (non-GAAP)

$

3.70-3.85

$

3.85

(1)

Includes North America water treatment pre-tax restructuring and impairment expenses of approximately $20.0 million of which $22.6 million was recognized in the second quarter. Anticipated proceeds from the sale of certain assets are expected to occur in late 2026.

SOURCE A. O. Smith Corporation

Resources Investor Relations Journalists Agencies Client Login Send a Release News Products Contact , /PRNewswire/ -- Directors of A. O. Smith Corporation (NYSE: AOS) today declared a regular quarterly cash dividend of $.36 per share on the company's Common Stock and Class A Common Stock.

The dividend is payable on Monday, Aug. 17 to shareholders of record Friday, July 31, 2026.

About A. O. Smith
A. O. Smith Corporation, with headquarters in Milwaukee, Wisconsin, is a global leader applying innovative technology and energy-efficient solutions to products manufactured and marketed worldwide. Listed on the New York Stock Exchange (NYSE: AOS), the company is one of the world's leading manufacturers of residential and commercial water heating equipment and boilers, as well as a manufacturer of water treatment and water management products. For more information, visit www.aosmith.com.

SOURCE A. O. Smith Corporation

Also from this source

Investors in A. O. Smith Corporation (AOS - Free Report) need to pay close attention to the stock based on moves in the options market lately. That is because the July 17, 2026 $40.00 Call had some of the highest implied volatility of all equity options today.

What is Implied Volatility?Implied volatility shows how much movement the market is expecting in the future. Options with high levels of implied volatility suggest that investors in the underlying stocks are expecting a big move in one direction or the other. It could also mean there is an event coming up soon that may cause a big rally or a huge sell-off. However, implied volatility is only one piece of the puzzle when putting together an options trading strategy.

What do the Analysts Think?Clearly, options traders are pricing in a big move for A. O. Smith shares, but what is the fundamental picture for the company? Currently, A. O. Smith is a Zacks Rank #4 (Sell) in the Manufacturing - Electronics industry that ranks in the Top 32% of our Zacks Industry Rank. Over the last 60 days, no analysts have increased their earnings estimates for the current quarter, while five analysts have revised their estimates downward. The net effect has taken our Zacks Consensus Estimate for the current quarter from $1.10 per share to 99 cents in that period.

Given the way analysts feel about A. O. Smith right now, this huge implied volatility could mean there’s a trade developing. Oftentimes, options traders look for options with high levels of implied volatility to sell premium. This is a strategy many seasoned traders use because it captures decay. At expiration, the hope for these traders is that the underlying stock does not move as much as originally expected.

This page has not been authorized, sponsored, or otherwise approved or endorsed by the companies represented herein. Each of the company logos represented herein are trademarks of Microsoft Corporation; Dow Jones & Company; Nasdaq, Inc.; Forbes Media, LLC; Investor's Business Daily, Inc.; and Morningstar, Inc.

Copyright 2026 Zacks Investment Research 101 N Wacker Drive, Floor 15, Chicago, IL 60606

At the center of everything we do is a strong commitment to independent research and sharing its profitable discoveries with investors. This dedication to giving investors a trading advantage led to the creation of our proven Zacks Rank stock-rating system. Since 1988 it has more than doubled the S&P 500 with an average gain of +24.00% per year. These returns cover a period from January 1, 1988 through May 4, 2026. Zacks Rank stock-rating system returns are computed monthly based on the beginning of the month and end of the month Zacks Rank stock prices plus any dividends received during that particular month. A simple, equally-weighted average return of all Zacks Rank stocks is calculated to determine the monthly return. The monthly returns are then compounded to arrive at the annual return. Only Zacks Rank stocks included in Zacks hypothetical portfolios at the beginning of each month are included in the return calculations. Zacks Ranks stocks can, and often do, change throughout the month. Certain Zacks Rank stocks for which no month-end price was available, pricing information was not collected, or for certain other reasons have been excluded from these return calculations. Zacks may license the Zacks Mutual Fund rating provided herein to third parties, including but not limited to the issuer.

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Posted by Defense World Staff on Apr 24th, 2026

Bayforest Capital Ltd trimmed its position in shares of A. O. Smith Corporation (NYSE:AOS – Free Report) by 93.6% in the 4th quarter, according to the company in its most recent Form 13F filing with the Securities and Exchange Commission. The fund owned 653 shares of the industrial products company’s stock after selling 9,558 shares during the period. Bayforest Capital Ltd’s holdings in A. O. Smith were worth $44,000 as of its most recent SEC filing.

Other institutional investors also recently modified their holdings of the company. JPMorgan Chase & Co. lifted its holdings in A. O. Smith by 26.4% in the 3rd quarter. JPMorgan Chase & Co. now owns 665,793 shares of the industrial products company’s stock worth $48,876,000 after buying an additional 139,117 shares during the period. First Trust Advisors LP increased its stake in shares of A. O. Smith by 4.6% during the third quarter. First Trust Advisors LP now owns 2,508,947 shares of the industrial products company’s stock valued at $184,182,000 after buying an additional 109,654 shares during the period. Alps Advisors Inc. increased its stake in shares of A. O. Smith by 19.9% during the third quarter. Alps Advisors Inc. now owns 273,216 shares of the industrial products company’s stock valued at $20,057,000 after buying an additional 45,299 shares during the period. Earnest Partners LLC raised its holdings in shares of A. O. Smith by 1.8% during the third quarter. Earnest Partners LLC now owns 2,082,982 shares of the industrial products company’s stock valued at $152,912,000 after acquiring an additional 36,122 shares in the last quarter. Finally, Dimensional Fund Advisors LP lifted its stake in A. O. Smith by 2.1% in the third quarter. Dimensional Fund Advisors LP now owns 1,871,694 shares of the industrial products company’s stock worth $137,393,000 after acquiring an additional 38,694 shares during the period. 76.10% of the stock is currently owned by hedge funds and other institutional investors.

A. O. Smith Price Performance Shares of AOS stock opened at $65.14 on Friday. The stock has a market cap of $9.01 billion, a price-to-earnings ratio of 16.88, a PEG ratio of 1.36 and a beta of 1.35. The business’s fifty day moving average is $69.24 and its 200 day moving average is $69.19. A. O. Smith Corporation has a twelve month low of $62.14 and a twelve month high of $81.86. The company has a quick ratio of 0.94, a current ratio of 1.50 and a debt-to-equity ratio of 0.06.

A. O. Smith (NYSE:AOS – Get Free Report) last posted its quarterly earnings data on Thursday, January 29th. The industrial products company reported $0.90 earnings per share (EPS) for the quarter, topping analysts’ consensus estimates of $0.84 by $0.06. A. O. Smith had a return on equity of 29.51% and a net margin of 14.26%.The business had revenue of $912.50 million during the quarter, compared to the consensus estimate of $928.97 million. During the same quarter in the prior year, the company earned $0.85 earnings per share. The firm’s quarterly revenue was up .0% compared to the same quarter last year. Research analysts expect that A. O. Smith Corporation will post 3.98 EPS for the current fiscal year.

A. O. Smith Dividend Announcement The firm also recently declared a quarterly dividend, which will be paid on Friday, May 15th. Investors of record on Thursday, April 30th will be given a dividend of $0.36 per share. This represents a $1.44 dividend on an annualized basis and a yield of 2.2%. The ex-dividend date of this dividend is Thursday, April 30th. A. O. Smith’s dividend payout ratio (DPR) is 37.31%.

Insider Transactions at A. O. Smith In related news, SVP Darrell W. Schuh sold 1,104 shares of the business’s stock in a transaction dated Wednesday, March 4th. The shares were sold at an average price of $74.39, for a total transaction of $82,126.56. Following the sale, the senior vice president owned 2,201 shares of the company’s stock, valued at $163,732.39. The trade was a 33.40% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the SEC, which is available at this link. 0.50% of the stock is currently owned by company insiders.

Analyst Ratings Changes Several research firms recently weighed in on AOS. Robert W. Baird set a $77.00 price target on shares of A. O. Smith in a report on Friday, January 30th. Wall Street Zen cut shares of A. O. Smith from a “buy” rating to a “hold” rating in a research report on Saturday, February 14th. Citigroup cut their target price on shares of A. O. Smith from $78.00 to $74.00 and set a “neutral” rating on the stock in a research note on Monday, April 13th. Jefferies Financial Group set a $75.00 price target on shares of A. O. Smith and gave the company a “hold” rating in a research report on Friday, January 9th. Finally, Stifel Nicolaus set a $78.00 price target on shares of A. O. Smith and gave the stock a “buy” rating in a research note on Tuesday, April 14th. Two equities research analysts have rated the stock with a Buy rating, seven have assigned a Hold rating and one has given a Sell rating to the company’s stock. According to data from MarketBeat.com, the company has an average rating of “Hold” and an average price target of $74.89.

View Our Latest Stock Analysis on AOS

A. O. Smith Company Profile (Free Report)

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.

Recommended Stories Five stocks we like better than A. O. Smith Want to see what other hedge funds are holding AOS? Visit HoldingsChannel.com to get the latest 13F filings and insider trades for A. O. Smith Corporation (NYSE:AOS – Free Report).

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Q1 2026 net sales were $945.6 million, down 2% year over year. Diluted EPS was $0.85, down 11% year over year.EPS of $0.85 was below the analyst estimate of $0

The headline numbers for A.O. Smith (AOS) give insight into how the company performed in the quarter ended March 2026, but it may be worthwhile to compare some of its key metrics to Wall Street estimates and the year-ago actuals.

Key Takeaways A. O. Smith Q1 EPS fell 11% and missed estimates and sales declined 2% year over year.AOS faced sharp weakness in China, with organic sales down 17% in local currency.Company lowered 2026 EPS outlook and trimmed sales guidance amid ongoing market pressure. A. O. Smith Corporation’s (AOS - Free Report) first-quarter 2026 adjusted earnings of 85 cents per share missed the Zacks Consensus Estimate of 94 cents. The bottom line decreased 11% on a year-over-year basis.

    Net sales of $945.6 million missed the consensus estimate of $969 million. The top line declined 2% year over year, owing to weakness in the consumer appliance market in China.

Segmental DetailsA. O. Smith’s quarterly sales in North America (comprising the United States and Canada operations) increased 1% year over year to $753.4 million. Our estimate for segmental revenues was $760.9 million. This uptick was caused by benefits from effective pricing and the positive contribution of the Leonard Valve buyout.

Segmental earnings were $175.4 million, down 5.3% year over year.

Quarterly sales in the Rest of the World (including China, India and Europe) segment were $200.7 million, down 11% year over year. Organic sales in China fell 17% in local currency.

The segment’s earnings were $12.4 million, down 37.1% year over year due to weaker sales volumes, which were partially offset by cost reduction actions.

AOS’ Margin DetailsA.O. Smith’s cost of sales was $579.9 million, down 1.5% year over year. Selling, general & administrative expenses were $203.9 million, up 5.9%.

Gross profit decreased 2.6% year over year to $365.7 million. The gross margin was 38.7% compared with 38.9% in the year-ago period. Interest expenses were $7.1 million compared with $2.9 million in the year-ago quarter.

A.O. Smith’s Liquidity & Cash FlowAs of March 31, 2026, AOS’ cash and cash equivalents totaled $185.2 million compared with $174.5 million at the end of December 2025.

At the end of the first quarter, long-term debt was $574.2 million compared with $112.7 million at the end of December 2025. The increase in debt level was attributable to cash borrowed by the company under a new term loan for the acquisition of Leonard Valve.

In the first three months of 2026, cash provided by operating activities totaled $129.4 million compared with $38.7 million in the year-ago period.

AOS’ Share RepurchasesIn the first three months of 2026, A.O. Smith repurchased 0.7 million shares for $51.3 million. As of first quarter-end, approximately 5.1 million shares were left to be repurchased under the share repurchase authorization.

In January 2026, AOS’ board boosted the buyback program by another 5 million shares. For 2026, it expects to repurchase shares worth approximately $200 million.

A.O. Smith’s 2025 OutlookA.O. Smith has provided the sales outlook for 2026. The company expects net sales to be in the range of $3.90-$4.00 billion compared with $3.90-$4.02 billion predicted earlier.

Management currently projects adjusted earnings per share to be in the band of $3.70-$4.00, lower than $3.85-$4.15 projected previously.

AOS’ Zacks Rank and Stocks to ConsiderThe company currently carries a Zacks Rank #4 (Sell). Some better-ranked stocks from the same space are discussed below:

DXP Enterprises (DXPE - Free Report) presently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

DXP Enterprises’ earnings surpassed the consensus estimate by 52.8% in the last reported quarter. In the past 60 days, the Zacks Consensus Estimate for DXPE’s 2026 earnings has increased by 17.2%.

Kennametal (KMT - Free Report) presently sports a Zacks Rank of 1. Kennametal’s earnings surpassed the consensus estimate thrice and missed once in the trailing four quarters. The average earnings surprise was 35.4%. In the past 60 days, the Zacks Consensus Estimate for Kennametal’s fiscal 2026 earnings has increased 9%.

Powell Industries (POWL - Free Report) currently carries a Zacks Rank of 2. Powell’s earnings topped the consensus estimate in each of the trailing four quarters. The average earnings surprise was 12.9%. In the past 60 days, the Zacks Consensus Estimate for Powell’s fiscal 2026 earnings has increased 3%.

Explore the exciting world of A.O. Smith (AOS +0.72%) with our contributing expert analysts in this Motley Fool Scoreboard episode. Check out the video below to gain valuable insights into market trends and potential investment opportunities!
*Stock prices used were the prices of March 11, 2026. The video was published on May 6, 2026.

Anand Chokkavelu has no position in any of the stocks mentioned. Jason Hall has no position in any of the stocks mentioned. Tyler Crowe has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends A. O. Smith. The Motley Fool has a disclosure policy.

This page has not been authorized, sponsored, or otherwise approved or endorsed by the companies represented herein. Each of the company logos represented herein are trademarks of Microsoft Corporation; Dow Jones & Company; Nasdaq, Inc.; Forbes Media, LLC; Investor's Business Daily, Inc.; and Morningstar, Inc.

Copyright 2026 Zacks Investment Research 101 N Wacker Drive, Floor 15, Chicago, IL 60606

At the center of everything we do is a strong commitment to independent research and sharing its profitable discoveries with investors. This dedication to giving investors a trading advantage led to the creation of our proven Zacks Rank stock-rating system. Since 1988 it has more than doubled the S&P 500 with an average gain of +24.00% per year. These returns cover a period from January 1, 1988 through May 4, 2026. Zacks Rank stock-rating system returns are computed monthly based on the beginning of the month and end of the month Zacks Rank stock prices plus any dividends received during that particular month. A simple, equally-weighted average return of all Zacks Rank stocks is calculated to determine the monthly return. The monthly returns are then compounded to arrive at the annual return. Only Zacks Rank stocks included in Zacks hypothetical portfolios at the beginning of each month are included in the return calculations. Zacks Ranks stocks can, and often do, change throughout the month. Certain Zacks Rank stocks for which no month-end price was available, pricing information was not collected, or for certain other reasons have been excluded from these return calculations. Zacks may license the Zacks Mutual Fund rating provided herein to third parties, including but not limited to the issuer.

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At the center of everything we do is a strong commitment to independent research and sharing its profitable discoveries with investors. This dedication to giving investors a trading advantage led to the creation of our proven Zacks Rank stock-rating system. Since 1988 it has more than doubled the S&P 500 with an average gain of +24.00% per year. These returns cover a period from January 1, 1988 through May 4, 2026. Zacks Rank stock-rating system returns are computed monthly based on the beginning of the month and end of the month Zacks Rank stock prices plus any dividends received during that particular month. A simple, equally-weighted average return of all Zacks Rank stocks is calculated to determine the monthly return. The monthly returns are then compounded to arrive at the annual return. Only Zacks Rank stocks included in Zacks hypothetical portfolios at the beginning of each month are included in the return calculations. Zacks Ranks stocks can, and often do, change throughout the month. Certain Zacks Rank stocks for which no month-end price was available, pricing information was not collected, or for certain other reasons have been excluded from these return calculations. Zacks may license the Zacks Mutual Fund rating provided herein to third parties, including but not limited to the issuer.

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