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Nykredit A S purchased a new stake in Watts Water Technologies, Inc. (NYSE:WTS – Free Report) during the 2nd quarter, according to its most recent disclosure with the Securities and Exchange Commission (SEC). The institutional investor purchased 1,629 shares of the technology company’s stock, valued at approximately $638,000.

Several other hedge funds also recently added to or reduced their stakes in WTS. Integrated Wealth Concepts LLC raised its stake in shares of Watts Water Technologies by 10.2% in the 1st quarter. Integrated Wealth Concepts LLC now owns 1,887 shares of the technology company’s stock valued at $385,000 after purchasing an additional 174 shares in the last quarter. Jones Financial Companies Lllp increased its holdings in Watts Water Technologies by 80.2% in the first quarter. Jones Financial Companies Lllp now owns 1,000 shares of the technology company’s stock valued at $222,000 after buying an additional 445 shares during the last quarter. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC raised its stake in Watts Water Technologies by 8.3% during the first quarter. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC now owns 98,878 shares of the technology company’s stock valued at $20,163,000 after buying an additional 7,537 shares in the last quarter. Sivia Capital Partners LLC bought a new position in Watts Water Technologies during the 2nd quarter worth approximately $219,000. Finally, Cetera Investment Advisers grew its position in shares of Watts Water Technologies by 43.2% in the 2nd quarter. Cetera Investment Advisers now owns 1,734 shares of the technology company’s stock worth $426,000 after acquiring an additional 523 shares in the last quarter. 95.02% of the stock is owned by institutional investors and hedge funds.

Insider Buying and Selling In other Watts Water Technologies news, Director Joseph Noonan sold 3,650 shares of Watts Water Technologies stock in a transaction on Tuesday, September 1st. The stock was sold at an average price of $353.72, for a total transaction of $1,291,078.00. The sale was disclosed in a filing with the SEC, which is available at this hyperlink. 1.00% of the stock is currently owned by corporate insiders.

Watts Water Technologies Trading Down 0.0% Shares of NYSE:WTS opened at $363.05 on Tuesday. The company has a quick ratio of 1.60, a current ratio of 2.66 and a debt-to-equity ratio of 0.05. The company’s 50-day moving average price is $362.53 and its 200 day moving average price is $328.79. The company has a market cap of $12.12 billion, a PE ratio of 31.71, a P/E/G ratio of 3.56 and a beta of 1.13. Watts Water Technologies, Inc. has a fifty-two week low of $260.00 and a fifty-two week high of $394.54. Watts Water Technologies (NYSE:WTS – Get Free Report) last announced its quarterly earnings results on Wednesday, August 5th. The technology company reported $3.66 EPS for the quarter, beating the consensus estimate of $3.34 by $0.32. Watts Water Technologies had a net margin of 14.34% and a return on equity of 19.16%. The company had revenue of $763.10 million for the quarter, compared to analyst estimates of $725.99 million. During the same quarter last year, the business earned $3.09 earnings per share. Watts Water Technologies’s revenue was up 18.6% compared to the same quarter last year. Sell-side analysts anticipate that Watts Water Technologies, Inc. will post 12.75 earnings per share for the current year.

Watts Water Technologies Announces Dividend The firm also recently announced a quarterly dividend, which will be paid on Tuesday, September 15th. Investors of record on Tuesday, September 1st will be given a $0.63 dividend. This represents a $2.52 annualized dividend and a yield of 0.7%. The ex-dividend date is Tuesday, September 1st. Watts Water Technologies’s dividend payout ratio (DPR) is currently 22.01%.

Wall Street Analysts Forecast Growth A number of brokerages have recently weighed in on WTS. The Goldman Sachs Group reiterated a “neutral” rating and issued a $374.00 price target on shares of Watts Water Technologies in a report on Friday, August 7th. Robert W. Baird set a $405.00 price objective on Watts Water Technologies in a research note on Friday, August 7th. Weiss Ratings raised shares of Watts Water Technologies from a “buy (b)” rating to a “buy (b+)” rating in a report on Tuesday, September 1st. Royal Bank Of Canada lifted their price target on shares of Watts Water Technologies from $350.00 to $417.00 and gave the company a “sector perform” rating in a report on Friday, August 7th. Finally, Barclays boosted their price objective on shares of Watts Water Technologies from $414.00 to $425.00 and gave the company an “overweight” rating in a research report on Friday, August 7th. Five investment analysts have rated the stock with a Buy rating and six have issued a Hold rating to the company’s stock. According to MarketBeat, the stock currently has an average rating of “Hold” and an average price target of $367.70.

Read Our Latest Stock Analysis on Watts Water Technologies

Watts Water Technologies Company Profile (Free Report)

Watts Water Technologies, Inc is a global manufacturer and distributor of flow control products and solutions designed to ensure the safe, efficient delivery and use of water. Founded in 1874 and headquartered in North Andover, Massachusetts, the company has built a reputation for engineering innovation in residential, commercial and industrial plumbing, heating, cooling and water treatment systems. Watts operates through a comprehensive portfolio of brands and product lines that address application-specific requirements in water safety, pressure regulation, flow control and filtration.

The company’s product offerings span backflow preventers, pressure reducing valves, relief valves and steam traps, as well as hydronic balancing and temperature control devices for heating systems.

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Watts Water Technologies, Inc. (NYSE:WTS – Get Free Report)’s share price crossed above its two hundred day moving average during trading on Tuesday . The stock has a two hundred day moving average of $328.00 and traded as high as $364.17. Watts Water Technologies shares last traded at $354.66, with a volume of 207,588 shares changing hands.

Analyst Ratings Changes WTS has been the topic of a number of research analyst reports. Royal Bank Of Canada boosted their target price on Watts Water Technologies from $350.00 to $417.00 and gave the stock a “sector perform” rating in a research report on Friday, August 7th. Robert W. Baird set a $405.00 price target on Watts Water Technologies in a report on Friday, August 7th. Weiss Ratings reaffirmed a “buy (b)” rating on shares of Watts Water Technologies in a research note on Friday, August 7th. TD Cowen upped their price objective on Watts Water Technologies from $275.00 to $320.00 and gave the stock a “hold” rating in a report on Thursday, July 2nd. Finally, Deutsche Bank Aktiengesellschaft reiterated a “hold” rating and set a $358.00 target price on shares of Watts Water Technologies in a research report on Friday, May 8th. Five analysts have rated the stock with a Buy rating and six have issued a Hold rating to the company. According to data from MarketBeat.com, Watts Water Technologies currently has an average rating of “Hold” and a consensus target price of $367.70.

Read Our Latest Stock Analysis on WTS

Watts Water Technologies Price Performance The firm’s 50-day moving average price is $362.79 and its 200-day moving average price is $328.00. The company has a current ratio of 2.66, a quick ratio of 1.60 and a debt-to-equity ratio of 0.05. The stock has a market capitalization of $11.84 billion, a PE ratio of 30.97, a PEG ratio of 3.59 and a beta of 1.13. Watts Water Technologies (NYSE:WTS – Get Free Report) last released its quarterly earnings results on Wednesday, August 5th. The technology company reported $3.66 EPS for the quarter, topping the consensus estimate of $3.34 by $0.32. Watts Water Technologies had a return on equity of 19.16% and a net margin of 14.34%.The company had revenue of $763.10 million during the quarter, compared to analyst estimates of $725.99 million. During the same quarter last year, the business posted $3.09 earnings per share. The firm’s revenue was up 18.6% on a year-over-year basis. On average, equities analysts forecast that Watts Water Technologies, Inc. will post 12.75 EPS for the current fiscal year.

Watts Water Technologies Dividend Announcement The business also recently announced a quarterly dividend, which will be paid on Tuesday, September 15th. Stockholders of record on Tuesday, September 1st will be issued a $0.63 dividend. The ex-dividend date is Tuesday, September 1st. This represents a $2.52 dividend on an annualized basis and a dividend yield of 0.7%. Watts Water Technologies’s payout ratio is 22.01%.

Hedge Funds Weigh In On Watts Water Technologies Large investors have recently modified their holdings of the stock. Kingsview Wealth Management LLC bought a new position in Watts Water Technologies during the fourth quarter valued at $2,848,000. Cumberland Partners Ltd raised its stake in shares of Watts Water Technologies by 100.0% in the fourth quarter. Cumberland Partners Ltd now owns 13,000 shares of the technology company’s stock valued at $3,588,000 after acquiring an additional 6,500 shares during the period. Mach 1 Financial Group LLC bought a new stake in shares of Watts Water Technologies in the 4th quarter worth about $1,950,000. Handelsbanken Fonder AB boosted its stake in shares of Watts Water Technologies by 94.2% during the 4th quarter. Handelsbanken Fonder AB now owns 61,624 shares of the technology company’s stock worth $17,009,000 after purchasing an additional 29,896 shares during the period. Finally, Candriam S.C.A. boosted its stake in shares of Watts Water Technologies by 26.6% during the 1st quarter. Candriam S.C.A. now owns 34,579 shares of the technology company’s stock worth $10,038,000 after purchasing an additional 7,256 shares during the period. Institutional investors own 95.02% of the company’s stock.

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Watts Water Technologies, Inc is a global manufacturer and distributor of flow control products and solutions designed to ensure the safe, efficient delivery and use of water. Founded in 1874 and headquartered in North Andover, Massachusetts, the company has built a reputation for engineering innovation in residential, commercial and industrial plumbing, heating, cooling and water treatment systems. Watts operates through a comprehensive portfolio of brands and product lines that address application-specific requirements in water safety, pressure regulation, flow control and filtration.

The company’s product offerings span backflow preventers, pressure reducing valves, relief valves and steam traps, as well as hydronic balancing and temperature control devices for heating systems.

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Empowered Funds LLC boosted its stake in shares of Watts Water Technologies, Inc. (NYSE: WTS) by 1,808.0% in the undefined quarter, according to the company in its most recent 13F filing with the Securities and Exchange Commission (SEC). The fund owned 27,876 shares of the technology company's stock after purchasing an additional 26,415

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SummaryI upgrade Watts Water Technologies to buy, driven by surging data center sales, European recovery, and raised FY2026 guidance.Data center revenues tripled year-over-year, now representing 8% of FY2026 sales, with management projecting continued rapid growth.WTS’s European segment returned to organic growth, with margin expansion and limited disruption from product rationalization efforts.Despite a 28x NTM P/E, robust earnings growth, and upgraded guidance support attractive upside, even without multiple expansion. CasarsaGuru/E+ via Getty Images

Investment action I upgrade Watts Water Technologies (WTS) to buy from hold after Q2 2026 showed Europe returning to organic growth, data-center sales more than tripling y/y, and FY2026 guidance rising. As a recap, I kept WTS

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Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

Have you looked into how Watts Water (WTS - Free Report) performed internationally during the quarter ending June 2026? Considering the widespread global presence of this maker of valves for plumbing, heating and water needs, examining the trends in international revenues is essential for assessing its financial resilience and prospects for growth.

In today's increasingly interconnected global economy, a company's ability to tap into international markets can be a pivotal factor in shaping its overall financial health and growth trajectory. For investors, understanding a company's reliance on overseas markets has become increasingly crucial, as it offers insights into the company's sustainability of earnings, ability to tap into diverse economic cycles and overall growth potential.

Participation in global economies acts as a defense against economic difficulties at home and a pathway to more rapidly developing economies. However, it also comes with the complexities of dealing with fluctuating currencies, geopolitical risks and different market dynamics.

While delving into WTS' performance for the past quarter, we observed some fascinating trends in the revenue from its foreign segments that are commonly modeled and observed by analysts on Wall Street.

The recent quarter saw the company's total revenue reaching $763.2 million, marking an improvement of 18.6% from the prior-year quarter. Next, we'll examine the breakdown of WTS' revenue from abroad to comprehend the significance of its international presence.

Exploring WTS' International Revenue PatternsDuring the quarter, Europe contributed $124.6 million in revenue, making up 16.3% of the total revenue. When compared to the consensus estimate of $113.75 million, this meant a surprise of +9.54%. Looking back, Europe contributed $121.4 million, or 17.9%, in the previous quarter, and $111 million, or 17.2%, in the same quarter of the previous year.

Of the total revenue, $53.6 million came from APMEA during the last fiscal quarter, accounting for 7%. This represented a surprise of +28.85% as analysts had expected the region to contribute $41.6 million to the total revenue. In comparison, the region contributed $40.8 million, or 6%, and $34.2 million, or 5.3%, to total revenue in the previous and year-ago quarters, respectively.

Anticipated Revenues in Overseas MarketsFor the current fiscal quarter, it is anticipated by Wall Street analysts that Watts Water will post revenues of $683.4 million, which reflects an increase of 11.7% the same quarter in the previous year. The revenue contributions are expected to be 16.2% from Europe ($110.45 million), and 6.3% from APMEA ($43.2 million).

For the entire year, the company's total revenue is forecasted to be $2.85 billion, which is an improvement of 16.9% from the previous year. The revenue contributions from different regions are expected as follows: Europe will contribute 16.3% ($463.1 million), and APMEA 6% ($171.05 million) to the total revenue.

The Bottom LineRelying on international markets for revenues, Watts Water faces both prospects and perils. Thus, tracking the company's international revenue trends is essential for accurately projecting its future trajectory.

In an environment where global interconnections and geopolitical skirmishes are intensifying, Wall Street analysts keep a keen eye on these trends, particularly for firms with overseas operations, to adjust their earnings predictions. Moreover, a range of other aspects, including how a company fares in its home country, significantly affects these projections.

Here at Zacks, we put a great deal of emphasis on a company's changing earnings outlook, as empirical research has shown that's a powerful force driving a stock's near-term price performance. Quite naturally, the correlation is positive here -- an upward revision in earnings estimates drives the stock price higher.

With an impressive externally audited track record, our proprietary stock rating tool - the Zacks Rank - harnesses the power of earnings estimate revisions and serves as an effective indicator of a stock's near-term price performance.

Watts Water, bearing a Zacks Rank #3 (Hold), is expected to mirror the broader market's movements in the near term. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>> .

A Review of Watts Water's Recent Stock Market PerformanceOver the preceding four weeks, the stock's value has appreciated by 10.8%, against an upturn of 2.5% in the Zacks S&P 500 composite. In parallel, the Zacks Industrial Products sector, which counts Watts Water among its entities, has appreciated by 1.5%. Over the past three months, the company's shares have seen an increase of 27.2% versus the S&P 500's 5.1% increase. The sector overall has witnessed an increase of 3.5% over the same period.

ABB’s Rotork Deal Could Put These Flow Control Stocks Back in FocusWatts Water Technologies NYSE: WTS reported record second-quarter sales, operating income and earnings per share, driven by pricing, data center demand and contributions from recent acquisitions. The company raised its full-year sales and margin outlook, though executives said residential and non-institutional construction markets remain under pressure.

Second-quarter sales increased 19% on a reported basis to $763 million and rose 12% organically. Adjusted operating income increased 15% to $160 million, while adjusted operating margin declined 60 basis points to 21%. Adjusted earnings per share rose 18% year over year to $3.66.

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“We delivered another quarter of better-than-expected results, including record sales, operating income and earnings per share,” Chief Executive Officer Robert Pagano Jr. said. He attributed organic growth to data center demand and favorable pricing, partly offset by the company’s 80:20 product rationalization program.

Data Center Sales More Than Tripled Data centers continued to be a major source of growth for Watts during the quarter. Pagano said data center sales more than tripled from the prior-year period, supported by demand for cooling products, including the company’s recently launched CoolVault thermal storage tanks.

For the first six months of 2026, data center sales represented 8% of total company sales, including some customer-driven sales that were pulled forward from later periods. Watts now expects data center revenue to account for a mid- to high-single-digit percentage of full-year sales, compared with 3% in the prior year.

The company increased its estimate of its served addressable market for data center products to approximately $2 billion, from a prior estimate of more than $1 billion. Pagano said the revised estimate incorporates a broader global opportunity, including Europe, the Middle East and Southeast Asia, as well as growing adoption of liquid-cooling systems.

Watts said liquid cooling can increase its content opportunity per megawatt compared with traditional air-cooled systems. Pagano said the company’s content opportunity varies considerably by project, ranging from about $25,000 to $100,000 per megawatt. Liquid-cooled projects that include thermal storage tanks generally represent the higher end of that range.

While the company sees strong demand, management cautioned that data center projects can make quarterly results more variable. Customer requirements pulled roughly $5 million of data center project sales into the second quarter in the Americas and another approximately $5 million in APMEA, the Asia-Pacific, Middle East and Africa region.

Pagano said Watts has its greatest visibility into third-quarter construction schedules, while fourth-quarter timing is less certain because customers can shift project schedules or finalize designs closer to installation. The company said it is investing in inventory and capacity to respond to customer needs.

Regional Growth Led by Americas and APMEA The Americas segment posted 17% reported sales growth and 12% organic sales growth, largely reflecting pricing and volume tied to data center activity. Wholesale customers also pulled forward approximately $10 million in demand ahead of an SAP implementation at Watts’ largest site at the end of June.

Acquisitions contributed $28 million in Americas revenue, while the company’s product rationalization initiative reduced segment sales by approximately $8 million. Americas segment margin declined 150 basis points to 25.7%.

Europe reported sales growth of 12% and organic growth of 9%, supported by pricing and higher HVAC volumes. Foreign exchange also benefited reported growth. Europe’s segment margin increased 160 basis points to 13.3%.

APMEA delivered 57% reported sales growth and 31% organic growth. The company cited increased data center sales in China, including the pull-forward projects, as well as acquisition and foreign-exchange benefits. The Middle East conflict created headwinds, but the company said its recently acquired Saudi Cast operation has been relatively resilient because of its in-country business model. APMEA segment margin increased 100 basis points to 19.9%.

Margins, Cash Flow and Acquisitions Adjusted EBITDA rose 15% to $177 million, while adjusted EBITDA margin declined 70 basis points to 23.1%. Chief Financial Officer Diane McClintock said the margin decline primarily reflected 70 basis points of expected dilution from acquisitions, inflation and a difficult comparison against a prior-year tariff-related price-cost benefit.

Those factors were partly offset by favorable pricing, volume leverage and productivity gains. McClintock said the company recorded about 6% pricing in the second quarter and expects pricing to decline sequentially in the second half as it laps prior-year price increases. Watts has implemented selected price increases globally to address inflation linked to the Middle East conflict.

Year-to-date free cash flow was $108 million, compared with $105 million a year earlier. The company said higher accounts receivable from increased sales and a strategic inventory investment affected cash flow, but it expects seasonal improvement in the second half. Watts maintained its goal of converting at least 90% of net income into free cash flow for the full year.

Watts ended the quarter with a net debt-to-capitalization ratio of negative 12% and net leverage of negative 0.4 times. Pagano said the balance sheet provides capacity for strategic acquisitions, productivity investments, product development and other growth initiatives. The company completed five acquisitions in 2025 and said those businesses are performing well and remain on track to achieve or exceed targeted synergies.

Full-Year Outlook Raised Despite Construction Weakness Watts raised its full-year organic sales growth outlook to 8% to 11% and now expects reported sales growth of 14% to 17%. The company also increased its forecasts for adjusted EBITDA margin and adjusted operating margin expansion to a range of 20 to 80 basis points.

Americas organic sales are expected to rise 9% to 12%. Europe organic sales are projected to increase 1% to 4%. APMEA organic sales are forecast to grow 9% to 12%. Third-quarter organic sales growth is expected to be 5% to 8%. The guidance assumes no change in the Middle East conflict or in the current tariff structure. Watts also said it is excluding any potential refunds related to IEEPA tariffs from adjusted results.

Management said residential single-family construction conditions have become “slightly worse” than in the prior quarter, while multifamily construction remains soft. Healthcare and education have held up better, according to Pagano, but other nonresidential new-construction activity remains subdued outside of data centers.

“We are monitoring the macro environment, including tariffs, interest rates, and geopolitical developments,” Pagano said, adding that the company believes its repair-and-replacement exposure, which represents about 60% of sales, provides support across varying economic conditions.

About Watts Water Technologies (NYSE:WTS)Watts Water Technologies, Inc is a global manufacturer and distributor of flow control products and solutions designed to ensure the safe, efficient delivery and use of water. Founded in 1874 and headquartered in North Andover, Massachusetts, the company has built a reputation for engineering innovation in residential, commercial and industrial plumbing, heating, cooling and water treatment systems. Watts operates through a comprehensive portfolio of brands and product lines that address application-specific requirements in water safety, pressure regulation, flow control and filtration.

The company's product offerings span backflow preventers, pressure reducing valves, relief valves and steam traps, as well as hydronic balancing and temperature control devices for heating systems.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected].

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Key Takeaways WTS earnings are projected to grow 15.6% this fiscal year as analysts lift near-term profit estimates.WTS trades at 30.8X forward earnings versus 25.8X for its industry, raising the cost of a growth miss.Watts raised 2026 organic growth guidance to 8%-11%, but construction softness and costs remain risks. Watts Water Technologies, Inc. (WTS - Free Report) is pairing faster earnings growth with rising data center exposure and a higher 2026 outlook. The operating case has improved, but the stock’s valuation already reflects a sizable portion of that momentum.

The decision therefore hinges on whether earnings growth can keep outrunning a demanding multiple. WTS has supportive estimate revisions and balance-sheet flexibility, yet construction weakness, cost pressure and execution risks argue against chasing the shares indiscriminately.

WTS Growth Case Keeps StrengtheningProjected earnings growth for the current fiscal year is 15.6%. The Zacks Consensus Estimate for current fiscal year earnings has also moved 1.7% higher over the past four weeks, showing that analysts have become more constructive on near-term profitability.

That improvement follows second-quarter adjusted earnings of $3.66 per share, which beat the consensus mark by 9.6%. Organic sales rose 12.2%, while Watts raised its full-year organic growth outlook to 8% to 11% from 2% to 6%. Data center sales more than tripled year over year and represented 8% of first-half sales.

Image Source: Zacks Investment Research

Watts' Valuation Leaves Less Room for ErrorWTS trades at 30.8X forward earnings versus 25.8X for its industry and 18.8X for the S&P 500. Its 23.9X EV/EBITDA and 4.7X price-to-sales multiples also sit above industry levels of 13.6X and 2.6X, respectively.

That premium raises the cost of any growth disappointment. For investors comparing water-focused industrial names, Pentair plc (PNR - Free Report) spans residential and commercial water solutions and industrial water management. Xylem Inc. (XYL - Free Report) provides water technology across utility, industrial, residential and commercial applications. WTS still must justify its own above-industry valuation through sustained earnings and margin execution.

WTS Balance Sheet Supports More InvestmentWatts ended the second quarter with $347.9 million in cash and $108 million of long-term debt, leaving $239.9 million of net cash. That liquidity gives the company room to fund growth without adding meaningful balance-sheet strain.

Watts raised its 2026 capital expenditure outlook to $60 million to $65 million, partly to expand data center capacity in North America and China. The balance sheet also supports selective acquisitions, share repurchases and dividends, preserving flexibility as management allocates capital across growth and shareholder returns.

Watts Still Faces Construction and Cost RisksResidential and noninstitutional new construction remain soft. Single-family conditions worsened slightly in the second quarter, multifamily stayed weak and non-data-center nonresidential construction remained challenged.

Product rationalization is expected to reduce 2026 sales by about $25 million to $26 million in the Americas and $6 million to $8 million in Europe. Tariffs, inflation, acquisition dilution and geopolitical disruption can also slow margin improvement, while project-based data center demand may create quarter-to-quarter variability.

WTS Signals Favor Patience Over Chasing GrowthThe improving earnings outlook supports the growth case, but the valuation leaves little room for execution misses. That balance makes patience more reasonable than aggressively pursuing WTS after its operating momentum has already been rewarded.

WTS currently carries a Zacks Rank #3 (Hold), along with a VGM Score of F, Value Score of F, Growth Score of D and Momentum Score of C. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

On August 06, 2026, Watts Water Technologies Inc (WTS) shares rose 3.6% today, bringing the current price to $377.12. Over the past year, the stock has fluctuat

Key Takeaways Watts Water posted 18.6% sales growth and 18.4% adjusted EPS growth in the second quarter.Data center sales more than tripled, with demand strongest in the Americas and APMEA.Full-year sales growth guidance rose to 14-17%, while organic growth is now 8%-11%. Watts Water Technologies, Inc. (WTS - Free Report) reported second-quarter 2026 adjusted earnings of $3.66 per share, up 18.4% from $3.09 a year ago. The bottom line beat the Zacks Consensus Estimate of $3.34 by 9.6%.

Net sales rose 18.6% year over year to $763.2 million and topped the consensus mark of $726 million by 5.1%. Organic sales advanced 12.2%, driven by favorable pricing, higher volumes and data center growth. Year-to-date data center sales represented 8% of total sales.

Shares of the company have gained 40.6% in the past year compared with the Zacks Manufacturing - General Industrial industry’s growth of 13.6%.

Image Source: Zacks Investment Research

WTS' Data Center Momentum AcceleratesSecond-quarter data center sales more than tripled year over year. Demand was concentrated in the Americas and APMEA, while Europe represented an emerging opportunity. Management said project-based demand could create quarter-to-quarter variability.

Watts Water is investing in talent, product innovation and capacity while expanding relationships with contractors, original equipment manufacturers and hyperscalers. The company estimates its served addressable data center market at about $2 billion, with potential content ranging from roughly $25,000 to $100,000 per megawatt.

Watts Water's Americas Demand Supports GrowthAmericas sales increased 17.4% year over year to $585 million and rose 11.6% organically. Favorable pricing and higher volumes tied to data center demand supported the increase, while acquisitions added $28 million.

Segment margin fell 150 basis points (bps) to 25.7%. Acquisition dilution, inflation, tariffs and a difficult comparison with a prior-year tariff-related price-cost benefit outweighed gains from pricing, volume leverage and productivity.

WTS' Europe and APMEA Results StrengthenEurope sales rose 12.3% to $124.6 million, including 9.2% organic growth. Higher volumes and favorable pricing drove the advance, while foreign exchange contributed 3.1%. Segment margin expanded 160 bps to 13.3% as operating gains more than offset inflation.

APMEA sales climbed 56.7% to $53.6 million and advanced 30.7% organically. Data center growth in China more than offset weaker Middle East activity. Acquisitions contributed 17.3% and foreign exchange added 8.7%, while segment margin improved 100 bps to 19.9%.

Watts Water's Profitability Faces Cost PressureGross profit increased 14.8% to $374.1 million, though gross margin contracted 160 bps to 49.0%. Selling, general and administrative expenses rose 14.6% to $214.5 million.

Adjusted operating income increased 15% to $160 million, while adjusted operating margin declined 60 bps to 21.0%. Adjusted EBITDA rose 15.5% to $176.7 million, but its margin decreased 70 bps to 23.1%. Acquisition dilution, inflation and tariffs pressured profitability, partly offset by price realization, volume leverage and productivity.

WTS' Cash Flow Softens as Balance Sheet HoldsFor the first six months of 2026, operating cash flow declined to $120.8 million from $124.9 million. Free cash flow decreased to $98.2 million from $105.1 million, reflecting higher working capital and capital expenditures. The cash conversion rate fell to 45.1% from 60.1%.

Watts Water ended June with $347.9 million in cash and $108 million of long-term debt, resulting in net cash of $239.9 million. The company repurchased about 13,000 shares for $4.1 million during the quarter, leaving roughly $121 million under its authorization. Management expects cash flow to improve sequentially in the second half as working capital is monetized.

Watts Water Raises 2026 OutlookWTS now expects full-year reported sales growth of 14% to 17%, up from its prior 8% to 12% range. Organic growth is projected at 8% to 11% compared with the previous 2% to 6% outlook. Adjusted operating margin is forecast between 19.8% and 20.4%, while adjusted EBITDA margin is expected between 22.1% and 22.7%.

For the third quarter, management expects reported sales growth of 11% to 14% and organic growth of 5% to 8%. Adjusted operating margin is projected between 19.8% and 20.4%, with adjusted EBITDA margin of 22.2% to 22.8%. The outlook assumes no change in the Middle East conflict's impact and includes tariffs announced through Aug. 4, 2026.

On Aug. 3, 2026, WTS also declared a quarterly dividend of 63 cents per share, payable on Sept. 15, 2026, to shareholders of record as of Sept. 1, 2026.

WTS’ Zacks RankWatts Water currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Recent Performance of Peers in the Same SpaceFlowserve Corporation’s (FLS - Free Report) second-quarter 2026 adjusted earnings of 95 cents per share beat the Zacks Consensus Estimate of 86 cents by 10.5%. The bottom line increased 4.4% year over year.

The company generated revenues of $1.17 billion, which surpassed the Zacks Consensus Estimate of $1.16 billion by 0.9%. However, sales declined 1.6% year over year. Strong bookings growth and operating-margin expansion, along with a record aftermarket bookings performance, supported the quarterly results.

Generac Holdings Inc. (GNRC - Free Report) reported second-quarter 2026 adjusted earnings per share (EPS) of $2.91, which beat the Zacks Consensus Estimate of $1.95. GNRC registered an adjusted EPS of $1.65 in the prior-year quarter.

Net sales were $1.173 billion, up 11% from $1.06 billion in the prior-year quarter. The figure missed the consensus estimate by 0.4%.

Zebra Technologies Corporation (ZBRA - Free Report) reported second-quarter 2026 adjusted earnings of $6.35 per share, which beat the Zacks Consensus Estimate of $4.35. The bottom line increased 75.9% from $3.61 per share reported in the year-ago quarter.

Total revenues of $1.56 billion surpassed the consensus estimate of $1.50 billion. The top line increased 20.4% year over year, supported by broad-based growth across segments and regions. Consolidated organic net sales increased 9.2% year over year. Acquisitions contributed 8.7% to reported sales growth, while favorable foreign currency translation contributed 2.5%.

NORTH ANDOVER, Mass.--(BUSINESS WIRE)--Watts Water Technologies, Inc. (NYSE: WTS) – through its subsidiaries, one of the world’s leading manufacturers and providers of plumbing, heating and water quality products and solutions – today announced results for the second quarter of 2026.

Chief Executive Officer Robert J. Pagano Jr. said, “We delivered another strong quarter, achieving record sales, operating income and EPS, with double-digit organic growth. These results reflect the strength of our diversified portfolio, disciplined execution, and our ability to capture long-term growth opportunities. Building on our first half performance, we are increasing our full year 2026 sales and margin outlook. While the trade and geopolitical environments remain dynamic, our teams continue to execute well and remain focused on serving our customers. Through continued investments in innovation, digital capabilities and the One Watts Performance System, we are enhancing our competitive position and expanding opportunities for profitable growth across our portfolio. This includes attractive markets such as data centers, where our differentiated capabilities continue to drive strong customer demand and where we see significant opportunity ahead. Supported by our healthy balance sheet, consistent cash generation and disciplined capital allocation, we believe we are well positioned to continue delivering value for our customers and shareholders. I would like to thank the Watts team for their commitment and dedication, which continue to drive our success.”

A summary of second quarter financial results is as follows:

Second Quarter Ended

June 28,

June 29,

(In millions, except per share information)

2026

2025

% Change

Net sales

$

763.2

$

643.7

19

%

Organic sales growth % (1)

12

%

Operating income

$

154.0

$

135.3

14

%

Operating margin %

20.2

%

21.0

%

(80)

bps

Adjusted operating income (1)

$

160.0

$

139.1

15

%

Adjusted operating margin % (1)

21.0

%

21.6

%

(60)

bps

Diluted earnings per share

$

3.53

$

3.01

17

%

Special items (1)

0.13

0.08

Adjusted diluted earnings per share (1)

$

3.66

$

3.09

18

%

Second Quarter Financial Highlights
Second quarter 2026 performance compared to second quarter 2025

Sales of $763 million increased 19% on a reported basis and 12% on an organic basis, primarily due to favorable price realization and higher volume driven by data center growth. Acquisition sales within the Americas and APMEA contributed $34 million, or 5%, to reported sales growth. Favorable foreign exchange contributed $7 million, or 1%, to reported sales growth.

Operating margin decreased 80 basis points on a reported basis, and 60 basis points on an adjusted basis. Operating and adjusted operating margin decreased primarily due to acquisition dilution, inflation and tariffs, and the difficult comparison against the one-time tariff-related price/cost benefit in the prior year, partly offset by favorable price realization, sales volume leverage, and productivity. Operating margin was also unfavorably impacted by an increase in restructuring charges.

Regional Performance

Americas
Sales of $585 million increased 17% on a reported basis and 12% on an organic basis, primarily due to favorable price realization and higher volume driven by data center growth. Acquisition sales contributed $28 million, or 6%, to reported sales growth.

Segment margin decreased 150 basis points primarily due to acquisition dilution, inflation and tariffs, and the difficult comparison against the one-time tariff-related price/cost benefit in the prior year, partly offset by favorable price realization, sales volume leverage, and productivity.

Europe
Sales of $125 million increased 12% on a reported basis and 9% on an organic basis, primarily due to higher volumes and favorable price realization. Favorable foreign exchange contributed 3% to reported sales growth.

Segment margin increased 160 basis points primarily due to favorable price realization, sales volume leverage, and productivity, which more than offset higher inflation.

APMEA
Sales of $54 million increased 57% on a reported basis and 31% on an organic basis. Organic growth was primarily due to higher volume driven by data center growth in China partly offset by a decline in the Middle East. Acquisition sales contributed $6 million, or 17%, and favorable foreign exchange contributed 9% to reported sales growth.

Segment margin increased 100 basis points primarily due to favorable price realization and acquisition accretion, which more than offset inflation and cost headwinds from the Middle East conflict.

Cash Flow and Capital Allocation

For the first six months of 2026, operating cash flow was $121 million and net capital expenditure was $23 million, resulting in free cash flow of $98 million. In the comparable period last year, operating cash flow was $125 million and net capital expenditure was $20 million, resulting in free cash flow of $105 million. Free cash flow declined due to higher working capital levels and increased capital expenditures, which more than offset higher net income. Working capital increases were due to higher accounts receivable attributable to higher net sales, higher inventory due to incremental tariffs and strategic inventory investments to support expected end-market demand. Sequential increases in free cash flow are expected in the second half of 2026 as we monetize working capital with the seasonality of the business.

The Company repurchased approximately 13,000 shares of Class A common stock at a cost of $4.1 million during the second quarter of 2026. Approximately $121 million remains available under the stock repurchase program authorized in 2023. There is no expiration date for this program.

Full Year 2026 Outlook

The Company is increasing its full year sales and organic sales growth outlook as well as its operating margin and adjusted operating margin outlook. Sales growth is expected to range from up 14% to up 17% on a reported basis and up 8% to up 11% on an organic basis. Full year operating margin is expected to be between 19.4% and 20.0%, or up 100 basis points to up 160 basis points, and adjusted operating margin is expected to be between 19.8% and 20.4%, or up 20 basis points to up 80 basis points. The full year outlook assumes no change in the level of impact resulting from the Middle East conflict and incorporates the estimated impact of tariffs in place or announced as of August 4, 2026. The full year outlook does not include the impact of tariff refunds, and any tariff refunds received in future periods will be treated as non-recurring special items and therefore will not be included in our adjusted results.

Further 2026 planning assumptions are included in the second quarter earnings materials posted in the Investor Relations section of our website at www.watts.com.

For a reconciliation of GAAP to non-GAAP items and a statement regarding the usefulness of these measures to investors and management in evaluating our operating performance, please see the tables attached to this press release.

Watts Water Technologies, Inc. will hold a live webcast of its conference call to discuss second quarter 2026 results on Thursday, August 6, 2026 at 9:00 a.m. EDT. This press release and the live webcast can be accessed by visiting the Investor Relations section of the Company's website at www.watts.com. Following the webcast, the call recording will be available at the same address until August 5, 2027.

Watts Water Technologies, Inc., through its subsidiaries, is a world leader in the manufacturing of innovative products to control the efficiency, safety, and quality of water within residential, commercial, and institutional applications. Watts’ expertise in a wide variety of water technologies enables us to be a comprehensive supplier to the water industry.

This press release includes “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995, including statements relating to expected full year 2026 financial results, including sales and organic sales growth, operating margin and adjusted operating margin, improvements in free cash flow in the second half of 2026, our strategy, investments, our ability to target and capitalize on growing markets, including our data center initiative, the impact of tariffs and any tariff refunds received as a result of the invalidation of tariffs imposed under the International Emergency Economic Powers Act, the benefits from and integration of acquisitions, our ability to manage uncertainty and current market conditions, including the fluid trade environment, future dividends, long-term growth and shareholder value creation. These forward-looking statements reflect our current views about future events. You should not rely on forward-looking statements because our actual results may differ materially from those predicted as a result of a number of potential risks and uncertainties. These potential risks and uncertainties include, but are not limited to: the continued growth of our customers’ markets; the imposition of or changes to tariff rates and related impacts to our business and the broader market; the effectiveness, timing and expected savings associated with our cost-cutting actions, restructuring and initiatives; integration of acquired businesses in a timely and cost-effective manner, retention of supplier and customer relationships and key employees, and the ability to achieve synergies and cost savings in the amounts and within the timeframes currently anticipated; current economic and financial conditions, which can affect the housing and construction markets where our products are sold, manufactured and marketed; shortages in and pricing of raw materials and supplies; our ability to compete effectively; changes in variable interest rates on our borrowings; inflation; failure to expand our markets through acquisitions; failure to successfully develop and introduce new product offerings or enhancements to existing products; failure to manufacture products that meet required performance and safety standards; foreign exchange rate fluctuations; cyclicality of industries where we market our products, such as plumbing and heating wholesalers and home improvement retailers; environmental compliance costs; product liability risks and costs; changes in the status of current litigation; the impacts and duration of the Middle East conflict, the war in Ukraine and other global crises; supply chain and logistical disruptions or labor shortages and workforce disruptions that could negatively affect our supply chain, manufacturing, distribution, or other business processes; and other risks and uncertainties discussed under the heading “Item 1A. Risk Factors” and in Note 17 of the Notes to the Consolidated Financial Statements in our Annual Report on Form 10-K for the year ended December 31, 2025, filed with the Securities and Exchange Commission (“SEC”). We undertake no duty to update the information contained in this press release, except as required by law.

WATTS WATER TECHNOLOGIES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(Amounts in millions, except per share information)

(Unaudited)

Second Quarter Ended

Six Months Ended

June 28,

June 29,

June 28,

June 29,

2026

2025

2026

2025

Net sales

$

763.2

$

643.7

$

1,440.4

$

1,201.7

Cost of goods sold

389.1

317.8

740.1

603.3

GROSS PROFIT

374.1

325.9

700.3

598.4

Selling, general and administrative expenses

214.5

187.2

407.5

354.7

Restructuring

5.6

3.4

5.8

20.7

OPERATING INCOME

154.0

135.3

287.0

223.0

Other (income) expense:

Interest income

(1.7

)

(2.3

)

(3.4

)

(4.6

)

Interest expense

2.2

2.7

4.8

5.4

Other (income) expense, net

(0.2

)

0.2

0.5

0.6

Total other expense

0.3

0.6

1.9

1.4

INCOME BEFORE INCOME TAXES

153.7

134.7

285.1

221.6

Provision for income taxes

35.4

33.8

67.2

46.7

NET INCOME

$

118.3

$

100.9

$

217.9

$

174.9

BASIC EPS

NET INCOME PER SHARE

$

3.53

$

3.01

$

6.50

$

5.22

Weighted average number of shares

33.5

33.5

33.5

33.5

DILUTED EPS

NET INCOME PER SHARE

$

3.53

$

3.01

$

6.50

$

5.22

Weighted average number of shares

33.5

33.5

33.5

33.5

Dividends declared per share

$

0.63

$

0.52

$

1.15

$

0.95

WATTS WATER TECHNOLOGIES, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(Amounts in millions, except share information)

(Unaudited)

June 28,

December 31,

2026

2025

ASSETS

CURRENT ASSETS:

Cash and cash equivalents

$

347.9

$

405.5

Trade accounts receivable, less reserve allowances of $16.9 million at June 28, 2026 and $12.5 million at December 31, 2025

404.4

294.0

Inventories, net:

Raw materials

206.4

190.8

Work in process

23.1

28.5

Finished goods

317.0

305.0

Total Inventories

546.5

524.3

Prepaid expenses and other current assets

66.8

62.3

Total Current Assets

1,365.6

1,286.1

PROPERTY, PLANT AND EQUIPMENT:

Property, plant and equipment, at cost

779.5

777.1

Accumulated depreciation

(484.0

)

(480.0

)

Property, plant and equipment, net

295.5

297.1

OTHER ASSETS:

Goodwill

858.4

859.0

Intangible assets, net

280.6

294.6

Deferred income taxes

18.3

17.9

Other, net

133.1

126.5

TOTAL ASSETS

$

2,951.5

$

2,881.2

LIABILITIES AND STOCKHOLDERS’ EQUITY

CURRENT LIABILITIES:

Accounts payable

$

182.1

$

182.2

Accrued expenses and other liabilities

248.5

234.7

Accrued compensation and benefits

82.7

95.5

Total Current Liabilities

513.3

512.4

LONG-TERM DEBT

108.0

197.7

DEFERRED INCOME TAXES

37.0

36.5

OTHER NONCURRENT LIABILITIES

103.8

106.9

STOCKHOLDERS’ EQUITY:

Preferred Stock, $0.10 par value; 5,000,000 shares authorized; no shares issued or outstanding

—

—

Class A common stock, $0.10 par value; 120,000,000 shares authorized; 1 vote per share; issued and outstanding, 27,466,829 shares at June 28, 2026 and 27,426,533 shares at December 31, 2025

2.7

2.7

Class B common stock, $0.10 par value; 25,000,000 shares authorized; 10 votes per share; issued and outstanding, 5,916,290 shares at June 28, 2026 and December 31, 2025

0.6

0.6

Additional paid-in capital

736.9

720.6

Retained earnings

1,589.4

1,431.3

Accumulated other comprehensive loss

(140.2

)

(127.5

)

Total Stockholders’ Equity

2,189.4

2,027.7

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY

$

2,951.5

$

2,881.2

WATTS WATER TECHNOLOGIES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Amounts in millions)

(Unaudited)

Six Months Ended

June 28,

June 29,

2026

2025

OPERATING ACTIVITIES

Net income

$

217.9

$

174.9

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation

19.2

17.9

Amortization of intangibles

11.9

9.9

Amortization of cloud computing arrangements

1.2

0.4

Loss on disposal of long-lived assets

0.2

0.2

Stock-based compensation

13.5

9.5

Deferred income tax

0.5

(6.2

)

Changes in operating assets and liabilities, net of effects from business acquisitions:

Accounts receivable

(114.4

)

(69.3

)

Inventories

(25.0

)

(37.0

)

Prepaid expenses and other assets

(18.4

)

(16.3

)

Accounts payable, accrued expenses and other liabilities

14.2

40.9

Net cash provided by operating activities

120.8

124.9

INVESTING ACTIVITIES

Additions to property, plant and equipment

(22.6

)

(19.8

)

Business acquisitions, net of cash acquired

(1.7

)

(85.7

)

Net cash used in investing activities

(24.3

)

(105.5

)

FINANCING ACTIVITIES

Payments of long-term debt

(90.0

)

—

Payments for withholding taxes on vested awards

(13.1

)

(11.1

)

Payments for finance leases and other

(1.4

)

(1.3

)

Payments to repurchase common stock

(7.9

)

(7.9

)

Dividends

(38.8

)

(32.0

)

Net cash used in financing activities

(151.2

)

(52.3

)

Effect of exchange rate changes on cash and cash equivalents

(2.9

)

15.3

DECREASE IN CASH AND CASH EQUIVALENTS

(57.6

)

(17.6

)

Cash and cash equivalents at beginning of year

405.5

386.9

CASH AND CASH EQUIVALENTS AT END OF PERIOD

$

347.9

$

369.3

Segment Earnings and Non-GAAP Financial Measures

In this press release, segment earnings is our GAAP performance measure used by our chief operating decision-maker (“CODM”) to assess and evaluate segment results. Segment earnings exclude the impact of non-recurring and unusual items, such as restructuring costs and acquisition-related costs. The CODM uses segment earnings for insight into underlying trends comparing past financial performance with current performance by reporting segment on a consistent basis. Segment margin is defined as segment earnings divided by segment revenue.

We refer to non-GAAP financial measures (including adjusted operating income, adjusted operating margin, adjusted net income, adjusted diluted earnings per share, organic sales, organic sales growth, free cash flow, cash conversion rate of free cash flow to net income and net debt to capitalization ratio) and provide a reconciliation of those non-GAAP financial measures to the corresponding financial measures contained in our consolidated financial statements prepared in accordance with GAAP. We believe these financial measures enhance the overall understanding of our historical financial performance and give insight into our future prospects. Adjusted operating income, adjusted operating margin, adjusted net income and adjusted diluted earnings per share eliminate certain expenses incurred and benefits recognized in the periods presented that relate primarily to our global restructuring programs, acquisition-related costs and the related income tax impacts on these items and tax adjustment items (with respect to adjusted net income and adjusted diluted earnings per share only). Management then utilizes these adjusted financial measures to assess the run rate of the Company’s operations against those of comparable periods. Organic sales and organic sales growth are non-GAAP measures of net sales and net sales growth excluding the impacts of foreign exchange, acquisitions and divestitures from period-over-period comparisons. Management believes reporting organic sales and organic sales growth provides useful information to investors, potential investors and others, and allows for a more complete understanding of underlying sales trends by providing sales and sales growth on a consistent basis. Free cash flow, cash conversion rate of free cash flow to net income, and the net debt to capitalization ratio, which are adjusted to exclude certain cash inflows and outlays, and include only certain balance sheet accounts from the comparable GAAP measures, are an indication of our performance in cash flow generation and also provide an indication of the Company's balance sheet leverage relative to other industrial manufacturing companies. These non-GAAP financial measures are among the primary indicators management uses as a basis for evaluating our cash flow generation and our capitalization structure. In addition, free cash flow is used as a criterion to measure and pay certain compensation-based incentives. For these reasons, management believes these non-GAAP financial measures can be useful to investors, potential investors and others. The Company’s non-GAAP financial measures may not be comparable to similarly titled measures reported by other companies. The presentation of this additional information is not meant to be considered in isolation or as a substitute for financial measures prepared in accordance with GAAP.

TABLE 1

RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES

EXCLUDING THE EFFECT OF ADJUSTMENTS FOR SPECIAL ITEMS

(Amounts in millions, except per share information)

(Unaudited)

CONSOLIDATED RESULTS

      Second Quarter Ended

Six Months Ended

June 28,

June 29,

June 28,

June 29,

2026

2025

2026

2025

      Net sales

$

763.2

  $

643.7

  $

1,440.4

  $

1,201.7

      Operating income

$

154.0

  $

135.3

  $

287.0

  $

223.0

Operating margin %

20.2

%

  21.0

%

  19.9

%

  18.6

%       Adjustments for special items:

      Restructuring

$

5.6

  $

3.4

  $

5.8

  $

20.7

Acquisition-related costs

0.4

  0.4

  3.1

  1.5

Total adjustments for special items

$

6.0

  $

3.8

  $

8.9

  $

22.2

      Adjusted operating income

$

160.0

  $

139.1

  $

295.9

  $

245.2

Adjusted operating margin %

21.0

%

  21.6

%

  20.5

%

  20.4

%       Net income

$

118.3

  $

100.9

  $

217.9

  $

174.9

      Adjustments for special items - tax effected:

      Restructuring

$

4.2

  $

2.5

  $

4.3

  $

15.5

Acquisition-related costs

0.3

  0.3

  2.4

  1.0

Tax adjustment items

—

  —

  —

  (8.3

)

Total adjustments for special items - tax effected

$

4.5

  $

2.8

  $

6.7

  $

8.2

      Adjusted net income

$

122.8

  $

103.7

  $

224.6

  $

183.1

      Diluted earnings per share

$

3.53

  $

3.01

  $

6.50

  $

5.22

Restructuring

0.12

  0.07

  0.13

  0.46

Acquisition-related costs

0.01

  0.01

  0.07

  0.03

Tax adjustment items

—

  —

  —

  (0.25

)

Adjusted diluted earnings per share

$

3.66

  $

3.09

  $

6.70

  $

5.46

TABLE 2

SEGMENT INFORMATION - RECONCILIATION OF SEGMENT EARNINGS TO CONSOLIDATED OPERATING INCOME - GAAP

(Amounts in millions)

(Unaudited)

Second Quarter Ended

June 28, 2026

June 29, 2025

Americas

Europe

APMEA

Total

Americas

Europe

APMEA

Total

Total segment net sales

$

587.0

131.0

86.1

$

804.1

$

500.5

121.6

65.5

$

687.6

Elimination of intersegment sales

(2.0

)

(6.4

)

(32.5

)

(40.9

)

(2.0

)

(10.6

)

(31.3

)

(43.9

)

Net sales from external customers

$

585.0

124.6

53.6

$

763.2

$

498.5

111.0

34.2

$

643.7

Segment earnings

$

150.1

16.6

10.6

$

177.3

$

135.8

13.0

6.5

$

155.3

Segment margin %

25.7%

13.3

% 19.9

% 23.2

% 27.2

% 11.7

% 18.9

%

24.1

% Corporate operating loss

$

(17.3

)

$

(16.2

)

Adjustments for segment special items:

$

(2.3

)

(3.7

)

—

$

(6.0

)

$

(0.4

)

(3.4

)

—

$

(3.8

)

Operating income

$

154.0

$

135.3

Operating margin %

20.2

% 21.0

%

Six Months Ended

June 28, 2026

June 29, 2025

Americas

Europe

APMEA

Total

Americas

Europe

APMEA

Total

Total segment net sales

$

1,104.9

258.6

153.8

$

1,517.3

$

920.8

238.1

121.9

$

1,280.8

Elimination of intersegment sales

(4.8

)

(12.6

)

(59.5

)

(76.9

)

(4.2

)

(18.7

)

(56.2

)

(79.1

)

Net sales from external customers

$

1,100.1

246.0

94.3

$

1,440.4

$

916.6

219.4

65.7

$

1,201.7

Segment earnings

$

274.7

33.2

18.2

$

326.1

$

233.6

28.1

12.0

$

273.7

Segment margin %

25.0

%

13.5

%

19.3

%

22.6

%

25.5

%

12.8

%

18.2

%

22.8

%

Corporate operating loss

$

(30.2

)

$

(28.5

)

Adjustments for segment special items:

$

(4.0

)

(3.8

)

(1.1

)

$

(8.9

)

$

(1.5

)

(20.6

)

(0.1

)

$

(22.2

)

Operating income

$

287.0

$

223.0

Operating margin %

19.9

%

18.6

%

TABLE 3

SEGMENT INFORMATION - RECONCILIATION OF NET SALES TO NON-GAAP ORGANIC SALES

(Amounts in millions)

(Unaudited)

      Second Quarter Ended

Americas

  Europe

  APMEA

  Total

      Net sales June 28, 2026

$

585.0

  $

124.6

  $

53.6

  $

763.2

Net sales June 29, 2025

$

498.5

  $

111.0

  $

34.2

  $

643.7

Dollar change

$

86.5

  $

13.6

  $

19.4

  $

119.5

Net sales % increase

17.4

%

  12.3

%

  56.7

%

  18.6

%

Foreign exchange impact

(0.1

)%

  (3.1

)%

  (8.7

)%

  (1.1

)%

Acquisition impact

(5.7

)%

  —

%

  (17.3

)%

  (5.3

)%

Organic sales % increase

11.6

%

  9.2

%

  30.7

%

  12.2

%

Six Months Ended

Americas

  Europe

  APMEA

  Total

      Net sales June 28, 2026

$

1,100.1

  $

246.0

  $

94.3

  $

1,440.4

Net sales June 29, 2025

916.6

  219.4

  65.7

  1,201.7

Dollar change

$

183.5

  $

26.6

  $

28.6

  $

238.7

Net sales % increase

20.0

%

  12.1

%

  43.5

%

  19.9

%

Foreign exchange impact

(0.1

)%

  (7.2

)%

  (8.0

)%

  (1.8

)%

Acquisition impact

(6.5

)%

  —

%

  (17.9

)%

  (6.0

)%

Organic sales % increase

13.4

%

  4.9

%

  17.6

%

  12.1

%

TABLE 4

RECONCILIATION OF NET CASH PROVIDED BY OPERATING ACTIVITIES TO FREE CASH FLOW

(Amounts in millions)

(Unaudited)

  Six Months Ended

June 28,

June 29,

2026

2025

  Net cash provided by operating activities

$

120.8

  $

124.9

Less: additions to property, plant, and equipment

(22.6

)

  (19.8

)

Free cash flow

$

98.2

  $

105.1

  Net income

$

217.9

  $

174.9

  Cash conversion rate of free cash flow to net income

45.1

%

  60.1

%

TABLE 5

RECONCILIATION OF LONG-TERM DEBT (INCLUDING CURRENT PORTION) TO NET DEBT AND NET DEBT TO CAPITALIZATION RATIO

(Amounts in millions)

(Unaudited)

  June 28,

December 31,

2026

2025

  Current portion of long-term debt

$

—

  $

—

Plus: long-term debt, net of current portion

108.0

  197.7

Less: cash and cash equivalents

(347.9

)

  (405.5

)

Net debt

$

(239.9

)

  $

(207.8

)

  Net debt

$

(239.9

)

  $

(207.8

)

Total stockholders’ equity

2,189.4

  2,027.7

Capitalization

$

1,949.5

  $

1,819.9

  Net debt to capitalization ratio

(12.3

)%

  (11.4

)%

TABLE 6

2026 FULL YEAR OUTLOOK – RECONCILIATION OF NET SALES GROWTH TO ORGANIC SALES GROWTH AND OPERATING MARGIN TO ADJUSTED OPERATING MARGIN

(Unaudited)

Total Watts

Full Year

2026 Outlook

Approximately

Net Sales

Net sales growth

14% to 17%

Forecasted impact of acquisition / FX

(6)%

Organic sales growth

8% to 11%

Operating Margin

Operating margin

19.4% to 20.0%

Forecasted restructuring / other costs

0.4%

Adjusted operating margin

19.8% to 20.4%

NORTH ANDOVER, Mass.--(BUSINESS WIRE)--Watts Water Technologies, Inc. (NYSE: WTS) today, Monday, August 3, 2026, declared that the Corporation will pay a quarterly dividend of Sixty-three cents ($0.63) per share on each outstanding share of the Company’s Class A Common Stock and Class B Common Stock, said dividend to be paid on September 15, 2026, to stockholders of record at the close of business on September 1, 2026.

Watts Water Technologies, Inc., through its family of companies, is a global manufacturer headquartered in the USA that provides one of the broadest plumbing, heating, and water quality product lines in the world. Watts Water companies and brands offer innovative plumbing, heating, and water quality solutions to control the efficiency, safety, and quality of water within commercial, residential, and industrial applications. For more information visit www.watts.com.

NORTH ANDOVER, Mass.--(BUSINESS WIRE)--Watts Water Technologies, Inc. (NYSE: WTS) will report its financial results for the second quarter 2026 in a press release to be issued after market close on Wednesday, August 5, 2026, and has scheduled a conference call and webcast on Thursday, August 6, 2026, at 9:00 a.m. Eastern Standard Time to discuss the results and outlook.

This call can be accessed by visiting the Investor Relations section of the Company’s website at www.watts.com. Following the webcast, an archived version of the call will be available at the same address until August 5, 2027.

Watts is pleased to announce that Ray Nash has joined the company as Vice President, Investor Relations and FP&A. He will join Robert J. Pagano, Jr., President and CEO, and Diane McClintock, CFO, on the earnings call.

Watts Water Technologies, Inc., through its family of companies, is a global manufacturer headquartered in the USA that provides one of the broadest plumbing, heating, and water quality product lines in the world. Watts Water companies and brands offer innovative plumbing, heating, and water quality solutions to control the efficiency, safety, and quality of water within commercial, residential, and industrial applications. For more information visit www.watts.com.

AI infrastructure stocks Watts Water Technologies (WTS) and Solaris Energy Infrastructure (SEI) continue to benefit from the growth of data centers. WTS stock and SEI stock rose near buy points on Tuesday.

Watts Water Technologies makes plumbing systems, valves and drains for the construction industry. Solaris Energy Infrastructure supplies power generators, transformers, switches and breakers for oil and gas companies. It recently revealed a massive contract tied to data centers for an unnamed global technology company.

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Powering and Cooling AI Data Centers Despite different end markets, the companies share a tailwind. Both provide solutions for the same bottleneck: the rapid scaling of the vast computer farms, called data centers, needed to power the rise of artificial intelligence (AI).

Solaris' power generators provide "behind the meter" electricity to server racks. This allows data center operators to generate their own reliable electricity, without depending on the power grid.

Once powered up, the AI chips heat up. That's when Watts Water's flow control systems step in to help data centers run cool.

Both companies are taking a modular approach to help data centers scale more quickly.

AI Infrastructure Stocks Near Buy Points Shares of Watts Water Technologies popped 1.7% to 339 in Tuesday's stock market action. The move put WTS stock just 2% below a 345.17 first-stage consolidation buy point. The data center supplier formed the right side of the pattern after robust earnings in May. Shares are up 22% year to date.

Shares of Solaris Energy Infrastructure dipped 2.6% on Tuesday. SEI stock is working on an 81.24 buy point, still 2% below the entry, the MarketSurge charts shows. It consolidated after late-April earnings, and the stock has gained 66% this year.

The relative strength lines for both data-center suppliers are nearing new highs.

Solaris earnings per share grew 114% in the latest quarter and sales 55%, according to MarketSurge. Though robust, that was the slowest pace of sales growth since 2024. Along with earnings, the company reported signing a third long-term power contract, aiming to provide over 600 MW of power capacity to a leading tech firm.

Watts Water grew EPS 28% and sales 21% in the latest quarter. That marked the fourth straight quarter of accelerating sales growth.

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Watts Water Technologies, Inc. (NYSE: WTS) – through its subsidiaries, one of the world’s leading manufacturers and providers of plumbing, heating and water quality products and solutions – today announced the release of its 2025 Sustainability report, which highlights the Company’s dedication to environmental, social and governance practices and continued commitment to creating high-performance solutions that promote sustainability and efficiency.

This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20260615531859/en/

“Since setting our first-generation environmental goals in 2018, we have significantly reduced our water use, emissions and hazardous waste while continuing to grow as a company. That progress gives us confidence as we pursue our next generation of goals and continue challenging ourselves to make an even greater impact in the years ahead,” said Robert J. Pagano, Jr., CEO, President and Chairperson of the Board. “Reflecting on more than a decade of sustainability work, it is rewarding to see how far we have come and the measurable progress our teams have made across the business.”

Key accomplishments highlighted in the report include:

Advanced Watts’ second generation of environmental goals, adopted in 2024, by recommitting to 3% annual intensity reductions and targeting a reduction of 10,000 metric tons of CO2 equivalent (MTCO2e) in primary emissions by 2034 Reduced water intensity by 64% and absolute water consumption by 44% between 2018 and 2025, resulting in a reduction of nearly 100 million liters of water Reduced GHG intensity by 63% and absolute GHG emissions by 43% between 2018 and 2025, resulting in a reduction of nearly 15,000 MTCO2e in Scope 1 & 2 market-based emissions Reduced hazardous waste intensity by 57% and absolute hazardous waste generation by 34% between 2018 and 2025, resulting in a reduction of nearly 700,000 kilograms of hazardous waste In 2025, we completed Life Cycle Assessments (LCAs) for all products in our BLÜCHER facility and began LCA modeling at five additional manufacturing facilities, building on LCAs already completed for all products produced in our largest facility in Franklin, NH By the end of 2025, we had published 28 Environmental Product Declarations (EPDs) covering 39 product types and are on track to exceed our goal of publishing 50 EPDs by 2026 In 2025, AERCO, PVI, and the LYNC brands of boilers, water heaters, and heat pumps helped customers avoid more than 115,000 MT of CO2, almost three times the Watts Scope 1 and Scope 2 emissions for 2025 Employees volunteered more than 10,000 hours as part of the Watts Cares community giving program, more than doubling the number of hours volunteered in 2024 – the program’s inaugural year Provided clean water access to vulnerable communities through the company’s ongoing partnership with Planet Water Foundation, which in 2025 benefited nearly 89,000 people in six different countries Recognized in 2025 for sustainability and workplace achievements including Newsweek World’s Greenest Companies and America’s Most Responsible Companies, TIME America’s Top Green Tech Companies and America’s Best Companies, USA Today America’s Climate Leaders, Barron’s 100 Most Sustainable Companies, Great Place to Work Greater China, Best Workplaces for Women in Greater China and Top Places to Work Massachusetts To download Watts’ 2025 Sustainability Report or learn more about the Company’s sustainability programs, visit http://www.watts.com/our-story/sustainability.

View source version on businesswire.com: https://www.businesswire.com/news/home/20260615531859/en/

Birch Hill Investment Advisors LLC increased its position in Watts Water Technologies, Inc. (NYSE:WTS – Free Report) by 2.0% during the 4th quarter, according to its most recent filing with the Securities and Exchange Commission (SEC). The firm owned 189,909 shares of the technology company’s stock after acquiring an additional 3,760 shares during the quarter. Watts Water Technologies comprises about 2.2% of Birch Hill Investment Advisors LLC’s investment portfolio, making the stock its 17th biggest position. Birch Hill Investment Advisors LLC owned about 0.57% of Watts Water Technologies worth $52,419,000 at the end of the most recent reporting period.

Several other institutional investors have also recently bought and sold shares of the company. Boston Partners increased its stake in shares of Watts Water Technologies by 2.2% in the third quarter. Boston Partners now owns 907,336 shares of the technology company’s stock worth $253,211,000 after purchasing an additional 19,247 shares during the period. Invesco Ltd. increased its stake in shares of Watts Water Technologies by 34.4% in the third quarter. Invesco Ltd. now owns 469,508 shares of the technology company’s stock worth $131,124,000 after purchasing an additional 120,090 shares during the period. AQR Capital Management LLC increased its stake in shares of Watts Water Technologies by 17.5% in the third quarter. AQR Capital Management LLC now owns 326,139 shares of the technology company’s stock worth $90,226,000 after purchasing an additional 48,470 shares during the period. Port Capital LLC increased its stake in shares of Watts Water Technologies by 1.0% in the third quarter. Port Capital LLC now owns 251,206 shares of the technology company’s stock worth $70,157,000 after purchasing an additional 2,378 shares during the period. Finally, UBS Group AG grew its holdings in Watts Water Technologies by 223.0% in the 3rd quarter. UBS Group AG now owns 202,250 shares of the technology company’s stock valued at $56,484,000 after buying an additional 139,637 shares during the last quarter. Institutional investors own 95.02% of the company’s stock.

Analysts Set New Price Targets A number of analysts have issued reports on WTS shares. Zacks Research lowered Watts Water Technologies from a “strong-buy” rating to a “hold” rating in a report on Friday, February 27th. Weiss Ratings reaffirmed a “buy (b)” rating on shares of Watts Water Technologies in a report on Monday, December 29th. HSBC started coverage on Watts Water Technologies in a report on Tuesday, January 27th. They issued a “buy” rating on the stock. KeyCorp raised their target price on Watts Water Technologies from $340.00 to $360.00 and gave the company an “overweight” rating in a report on Thursday, February 12th. Finally, Royal Bank Of Canada raised their target price on Watts Water Technologies from $288.00 to $337.00 and gave the company a “sector perform” rating in a report on Friday, February 13th. Four analysts have rated the stock with a Buy rating and eight have given a Hold rating to the company’s stock. According to data from MarketBeat.com, the stock has a consensus rating of “Hold” and an average price target of $331.67.

Read Our Latest Report on Watts Water Technologies

Insiders Place Their Bets In related news, General Counsel Kenneth Robert Lepage sold 5,025 shares of the company’s stock in a transaction dated Tuesday, February 17th. The shares were sold at an average price of $321.08, for a total value of $1,613,427.00. Following the sale, the general counsel owned 12,284 shares of the company’s stock, valued at $3,944,146.72. The trade was a 29.03% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the SEC, which is available through this hyperlink. Also, CEO Robert J. Pagano, Jr. sold 16,066 shares of the company’s stock in a transaction dated Thursday, February 19th. The shares were sold at an average price of $327.31, for a total transaction of $5,258,562.46. Following the completion of the sale, the chief executive officer directly owned 191,202 shares in the company, valued at approximately $62,582,326.62. The trade was a 7.75% decrease in their position. The SEC filing for this sale provides additional information. Insiders have sold a total of 29,674 shares of company stock valued at $9,669,838 over the last 90 days. Company insiders own 1.00% of the company’s stock.

Watts Water Technologies Stock Performance NYSE WTS opened at $303.42 on Friday. The stock has a market cap of $10.12 billion, a P/E ratio of 29.83, a PEG ratio of 2.72 and a beta of 1.27. The company’s 50-day simple moving average is $308.31 and its 200 day simple moving average is $290.83. Watts Water Technologies, Inc. has a twelve month low of $191.20 and a twelve month high of $345.17. The company has a quick ratio of 1.49, a current ratio of 2.51 and a debt-to-equity ratio of 0.10.

Watts Water Technologies (NYSE:WTS – Get Free Report) last posted its earnings results on Wednesday, February 11th. The technology company reported $2.62 earnings per share for the quarter, beating analysts’ consensus estimates of $2.36 by $0.26. The business had revenue of $625.10 million for the quarter, compared to analysts’ expectations of $610.40 million. Watts Water Technologies had a net margin of 13.98% and a return on equity of 18.55%. The firm’s revenue for the quarter was up 15.7% on a year-over-year basis. During the same quarter in the previous year, the firm posted $2.05 earnings per share. As a group, research analysts forecast that Watts Water Technologies, Inc. will post 9.08 earnings per share for the current fiscal year.

Watts Water Technologies Dividend Announcement The firm also recently announced a monthly dividend, which was paid on Friday, March 13th. Investors of record on Friday, February 27th were paid a $0.52 dividend. The ex-dividend date of this dividend was Friday, February 27th. This represents a c) dividend on an annualized basis and a yield of 2.1%. Watts Water Technologies’s payout ratio is presently 20.45%.

Watts Water Technologies Company Profile (Free Report)

Watts Water Technologies, Inc is a global manufacturer and distributor of flow control products and solutions designed to ensure the safe, efficient delivery and use of water. Founded in 1874 and headquartered in North Andover, Massachusetts, the company has built a reputation for engineering innovation in residential, commercial and industrial plumbing, heating, cooling and water treatment systems. Watts operates through a comprehensive portfolio of brands and product lines that address application-specific requirements in water safety, pressure regulation, flow control and filtration.

The company’s product offerings span backflow preventers, pressure reducing valves, relief valves and steam traps, as well as hydronic balancing and temperature control devices for heating systems.

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AEGON ASSET MANAGEMENT UK Plc increased its holdings in shares of Watts Water Technologies, Inc. (NYSE:WTS – Free Report) by 30.1% in the 4th quarter, according to the company in its most recent Form 13F filing with the Securities and Exchange Commission (SEC). The fund owned 70,333 shares of the technology company’s stock after purchasing an additional 16,257 shares during the period. AEGON ASSET MANAGEMENT UK Plc owned approximately 0.21% of Watts Water Technologies worth $19,396,000 as of its most recent filing with the Securities and Exchange Commission (SEC).

Other institutional investors have also recently made changes to their positions in the company. Boston Partners grew its position in Watts Water Technologies by 2.2% during the third quarter. Boston Partners now owns 907,336 shares of the technology company’s stock valued at $253,211,000 after buying an additional 19,247 shares during the period. Invesco Ltd. grew its position in shares of Watts Water Technologies by 34.4% in the third quarter. Invesco Ltd. now owns 469,508 shares of the technology company’s stock valued at $131,124,000 after purchasing an additional 120,090 shares during the period. AQR Capital Management LLC grew its position in shares of Watts Water Technologies by 17.5% in the third quarter. AQR Capital Management LLC now owns 326,139 shares of the technology company’s stock valued at $90,226,000 after purchasing an additional 48,470 shares during the period. Port Capital LLC grew its position in shares of Watts Water Technologies by 1.0% in the third quarter. Port Capital LLC now owns 251,206 shares of the technology company’s stock valued at $70,157,000 after purchasing an additional 2,378 shares during the period. Finally, UBS Group AG grew its position in shares of Watts Water Technologies by 223.0% in the third quarter. UBS Group AG now owns 202,250 shares of the technology company’s stock valued at $56,484,000 after purchasing an additional 139,637 shares during the period. Hedge funds and other institutional investors own 95.02% of the company’s stock.

Analyst Ratings Changes Several analysts have recently issued reports on WTS shares. Royal Bank Of Canada lifted their target price on shares of Watts Water Technologies from $288.00 to $337.00 and gave the company a “sector perform” rating in a research report on Friday, February 13th. Barclays lifted their target price on shares of Watts Water Technologies from $300.00 to $323.00 and gave the company an “equal weight” rating in a research report on Friday, February 13th. Zacks Research lowered shares of Watts Water Technologies from a “strong-buy” rating to a “hold” rating in a research report on Friday, February 27th. TD Cowen reiterated a “hold” rating on shares of Watts Water Technologies in a research report on Thursday, January 8th. Finally, KeyCorp lifted their target price on shares of Watts Water Technologies from $340.00 to $360.00 and gave the company an “overweight” rating in a research report on Thursday, February 12th. Four research analysts have rated the stock with a Buy rating and eight have issued a Hold rating to the stock. According to data from MarketBeat.com, Watts Water Technologies has an average rating of “Hold” and an average target price of $331.67.

Check Out Our Latest Stock Report on Watts Water Technologies

Insider Activity at Watts Water Technologies In other Watts Water Technologies news, insider Elie Melhem sold 379 shares of Watts Water Technologies stock in a transaction dated Wednesday, March 18th. The shares were sold at an average price of $300.03, for a total transaction of $113,711.37. Following the transaction, the insider directly owned 11,592 shares of the company’s stock, valued at $3,477,947.76. The trade was a 3.17% decrease in their ownership of the stock. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through the SEC website. Also, major shareholder Timothy P. Horne sold 7,500 shares of Watts Water Technologies stock in a transaction dated Friday, February 20th. The stock was sold at an average price of $330.04, for a total transaction of $2,475,300.00. Following the transaction, the insider directly owned 7,500 shares in the company, valued at $2,475,300. This trade represents a 50.00% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. Insiders sold 29,674 shares of company stock valued at $9,669,838 over the last ninety days. Corporate insiders own 1.00% of the company’s stock.

Watts Water Technologies Price Performance Shares of WTS stock opened at $301.17 on Friday. The company has a debt-to-equity ratio of 0.10, a current ratio of 2.51 and a quick ratio of 1.49. The firm’s 50-day moving average is $305.98 and its two-hundred day moving average is $291.48. Watts Water Technologies, Inc. has a 12 month low of $201.21 and a 12 month high of $345.17. The company has a market capitalization of $10.04 billion, a PE ratio of 29.61, a price-to-earnings-growth ratio of 2.76 and a beta of 1.27.

Watts Water Technologies (NYSE:WTS – Get Free Report) last issued its earnings results on Wednesday, February 11th. The technology company reported $2.62 EPS for the quarter, topping analysts’ consensus estimates of $2.36 by $0.26. Watts Water Technologies had a net margin of 13.98% and a return on equity of 18.55%. The company had revenue of $625.10 million for the quarter, compared to the consensus estimate of $610.40 million. During the same period in the previous year, the firm earned $2.05 earnings per share. Watts Water Technologies’s quarterly revenue was up 15.7% compared to the same quarter last year. Analysts predict that Watts Water Technologies, Inc. will post 11.62 earnings per share for the current year.

Watts Water Technologies Dividend Announcement The company also recently announced a monthly dividend, which was paid on Friday, March 13th. Shareholders of record on Friday, February 27th were paid a dividend of $0.52 per share. The ex-dividend date of this dividend was Friday, February 27th. This represents a c) dividend on an annualized basis and a yield of 2.1%. Watts Water Technologies’s payout ratio is 20.45%.

About Watts Water Technologies (Free Report)

Watts Water Technologies, Inc is a global manufacturer and distributor of flow control products and solutions designed to ensure the safe, efficient delivery and use of water. Founded in 1874 and headquartered in North Andover, Massachusetts, the company has built a reputation for engineering innovation in residential, commercial and industrial plumbing, heating, cooling and water treatment systems. Watts operates through a comprehensive portfolio of brands and product lines that address application-specific requirements in water safety, pressure regulation, flow control and filtration.

The company’s product offerings span backflow preventers, pressure reducing valves, relief valves and steam traps, as well as hydronic balancing and temperature control devices for heating systems.

Further Reading Five stocks we like better than Watts Water Technologies Want to see what other hedge funds are holding WTS? Visit HoldingsChannel.com to get the latest 13F filings and insider trades for Watts Water Technologies, Inc. (NYSE:WTS – Free Report).

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NORTH ANDOVER, Mass.--(BUSINESS WIRE)--Watts Water Technologies, Inc. (NYSE: WTS) today declared that the Corporation will pay a quarterly dividend of Sixty-three cents ($0.63) per share on each outstanding share of the Company’s Class A Common Stock and Class B Common Stock, said dividend to be paid on June 15, 2026 to stockholders of record at the close of business on June 1, 2026.

Watts Water Technologies, Inc., through its family of companies, is a global manufacturer headquartered in the USA that provides one of the broadest plumbing, heating, and water quality product lines in the world. Watts Water companies and brands offer innovative plumbing, heating, and water quality solutions to control the efficiency, safety, and quality of water within commercial, residential, and industrial applications. For more information visit www.watts.com.

Watts Water (WTS - Free Report) reported $677.3 million in revenue for the quarter ended March 2026, representing a year-over-year increase of 21.4%. EPS of $3.04 for the same period compares to $2.37 a year ago.

The reported revenue compares to the Zacks Consensus Estimate of $632.09 million, representing a surprise of +7.15%. The company delivered an EPS surprise of +11.65%, with the consensus EPS estimate being $2.72.

While investors scrutinize revenue and earnings changes year-over-year and how they compare with Wall Street expectations to determine their next move, some key metrics always offer a more accurate picture of a company's financial health.

Since these metrics play a crucial role in driving the top- and bottom-line numbers, comparing them with the year-ago numbers and what analysts estimated about them helps investors better project a stock's price performance.

Here is how Watts Water performed in the just reported quarter in terms of the metrics most widely monitored and projected by Wall Street analysts:

Geographic Revenue- Americas: $515.1 million compared to the $486.7 million average estimate based on two analysts. The reported number represents a change of +23.2% year over year.Geographic Revenue- APMEA: $40.8 million compared to the $38.8 million average estimate based on two analysts. The reported number represents a change of +29.5% year over year.Geographic Revenue- Europe: $121.4 million versus $116.45 million estimated by two analysts on average. Compared to the year-ago quarter, this number represents a +12% change.View all Key Company Metrics for Watts Water here>>>

Shares of Watts Water have returned +0.6% over the past month versus the Zacks S&P 500 composite's +10.3% change. The stock currently has a Zacks Rank #3 (Hold), indicating that it could perform in line with the broader market in the near term.

Watts Water Technologies, Inc. (WTS) Q1 2026 Earnings Call Transcript

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Stock to Watch: Watts Water (WTS - Free Report) Headquartered in North Andover, MA, Watts Water Technologies, Inc. designs, manufactures and sells various water safety and flow control products to promote safety, energy efficiency, and water conservation for commercial and residential buildings. The company reports its business under three geographic segments: The Americas (75.8% of total revenues in 2025), Europe (18.5%) and APMEA consisting of Asia-Pacific, the Middle East and Africa (5.7%).

WTS is a #3 (Hold) on the Zacks Rank, with a VGM Score of B.

Additionally, the company could be a top pick for growth investors. WTS has a Growth Style Score of B, forecasting year-over-year earnings growth of 10.2% for the current fiscal year.

For fiscal 2026, one analyst revised their earnings estimate upwards in the last 60 days, and the Zacks Consensus Estimate has increased $0.05 to $11.66 per share. WTS boasts an average earnings surprise of +11.8%.

With a solid Zacks Rank and top-tier Growth and VGM Style Scores, WTS should be on investors' short list.

NORTH ANDOVER, Mass.--(BUSINESS WIRE)--Watts Water Technologies, Inc. (NYSE: WTS) is proud to share that it has been named to TIME’s World’s Most Impactful Companies 2026 list in this new ranking’s inaugural year. Watts’ inclusion in this list is a recognition of the company’s net-positive contribution to the world, based on a scientific assessment of data on its technologies, operations, and global business practices.

The World’s Most Impactful Companies list, presented by TIME in partnership with Statista and The Upright Project, identifies companies and organizations that demonstrate a strong net-positive impact across key dimensions, including Society, Environment, Health, and Knowledge. Inclusion on the list reflects an independent, data-driven assessment of how effectively a company’s products and services contribute to global well-being across its full value chain.

“Being recognized by TIME as one of the World’s Most Impactful Companies acknowledges our commitment to delivering solutions that meet the needs of our customers and create lasting benefit for the environment as well as for communities across the globe,” said Robert J. Pagano, Jr., CEO, President and Chairperson of the Board at Watts. “At Watts, we are committed to advancing water safety, efficiency, and sustainability through innovation, while operating responsibly and holding ourselves accountable to measurable progress. This recognition is a direct result of the dedication and professionalism of our team members, who consistently uphold our value‑driven culture.”

Watts continues to integrate sustainability at the heart of its business strategy, reducing environmental impact by lowering emissions, advancing water conservation across its operations, and delivering solutions that help customers optimize performance while conserving critical resources.

To learn more about Watts’ Environment, Social and Governance (ESG) commitments and initiatives, read the company’s latest Sustainability Report or visit www.watts.com/our-story/sustainability.

The ranking is based on a rigorous, science-based methodology that evaluates companies using The Upright Project’s Net Impact Model, which analyzes the positive and negative effects of a company’s activities across its full value chain. Companies included must demonstrate a positive overall net impact and meet criteria related to scale, transparency, and available data.

About Watts
For more than 150 years, Watts has delivered innovative and sustainable technologies designed to safeguard the world’s most precious resource. Watts designs, manufactures, and sells an extensive line of flow control, water safety, water filtration and treatment, radiant heating, and drainage products for the commercial, residential, and institutional markets. Watts is committed to helping its customers optimize system performance and reliability while conserving critical resources. For more information, visit www.watts.com.

Watts Water (WTS - Free Report) could be a solid addition to your portfolio given its recent upgrade to a Zacks Rank #2 (Buy). This upgrade is essentially a reflection of an upward trend in earnings estimates -- one of the most powerful forces impacting stock prices.

The Zacks rating relies solely on a company's changing earnings picture. It tracks EPS estimates for the current and following years from the sell-side analysts covering the stock through a consensus measure -- the Zacks Consensus Estimate.

Since a changing earnings picture is a powerful factor influencing near-term stock price movements, the Zacks rating system is very useful for individual investors. They may find it difficult to make decisions based on rating upgrades by Wall Street analysts, as these are mostly driven by subjective factors that are hard to see and measure in real time.

Therefore, the Zacks rating upgrade for Watts Water basically reflects positivity about its earnings outlook that could translate into buying pressure and an increase in its stock price.

Most Powerful Force Impacting Stock PricesThe change in a company's future earnings potential, as reflected in earnings estimate revisions, and the near-term price movement of its stock are proven to be strongly correlated. The influence of institutional investors has a partial contribution to this relationship, as these big professionals use earnings and earnings estimates to calculate the fair value of a company's shares. An increase or decrease in earnings estimates in their valuation models simply results in higher or lower fair value for a stock, and institutional investors typically buy or sell it. Their transaction of large amounts of shares then leads to price movement for the stock.

Fundamentally speaking, rising earnings estimates and the consequent rating upgrade for Watts Water imply an improvement in the company's underlying business. Investors should show their appreciation for this improving business trend by pushing the stock higher.

Harnessing the Power of Earnings Estimate RevisionsAs empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock movements, tracking such revisions for making an investment decision could be truly rewarding. Here is where the tried-and-tested Zacks Rank stock-rating system plays an important role, as it effectively harnesses the power of earnings estimate revisions.

The Zacks Rank stock-rating system, which uses four factors related to earnings estimates to classify stocks into five groups, ranging from Zacks Rank #1 (Strong Buy) to Zacks Rank #5 (Strong Sell), has an impressive externally-audited track record, with Zacks Rank #1 stocks generating an average annual return of +25% since 1988. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here >>>> .

Earnings Estimate Revisions for Watts WaterThis maker of valves for plumbing, heating and water needs is expected to earn $11.90 per share for the fiscal year ending December 2026, which represents no year-over-year change.

Analysts have been steadily raising their estimates for Watts Water. Over the past three months, the Zacks Consensus Estimate for the company has increased 2.1%.

Bottom LineUnlike the overly optimistic Wall Street analysts whose rating systems tend to be weighted toward favorable recommendations, the Zacks rating system maintains an equal proportion of "buy" and "sell" ratings for its entire universe of more than 4,000 stocks at any point in time. Irrespective of market conditions, only the top 5% of the Zacks-covered stocks get a "Strong Buy" rating and the next 15% get a "Buy" rating. So, the placement of a stock in the top 20% of the Zacks-covered stocks indicates its superior earnings estimate revision feature, making it a solid candidate for producing market-beating returns in the near term.

You can learn more about the Zacks Rank here >>>

The upgrade of Watts Water to a Zacks Rank #2 positions it in the top 20% of the Zacks-covered stocks in terms of estimate revisions, implying that the stock might move higher in the near term.

It has been about a month since the last earnings report for Watts Water (WTS - Free Report) . Shares have added about 7.1% in that time frame, outperforming the S&P 500.

But investors have to be wondering, will the recent positive trend continue leading up to its next earnings release, or is Watts Water due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.

Watts Water Q1 Earnings & Revenues Beat Estimates, Rise Y/Y

Watts Water reported first-quarter 2026 adjusted earnings per share (EPS) of $3.04 compared with $2.37 in the prior-year quarter. The bottom line beat the Zacks Consensus Estimate by 11.8%.

The company’s quarterly net sales increased 21% year over year to $677.3 million. The top line beat the Zacks Consensus Estimate by 7.2%. Organic sales were up 12% year over year, driven by favorable prices and higher volumes supported by strong growth in the data center market.

Management highlighted that the company delivered a strong start to 2026, supported by organic growth across all regions and record first-quarter net sales, operating income, operating margin and EPS, reflecting disciplined execution and continued focus on delivering value to customers. Watts Water also emphasized that it is actively navigating geopolitical and trade-related uncertainties while continuing to invest in higher-growth opportunities such as data centers and digital solutions.

In addition, management noted that productivity and automation initiatives under the One Watts Performance System are helping drive efficiency and margin performance. Despite the solid start to the year, the company maintained its full-year 2026 outlook given the dynamic macroeconomic environment.

Supported by a strong balance sheet and healthy cash flow generation, management remains focused on disciplined capital allocation and creating sustainable long-term shareholder value.

Q1 Segment Results

Americas: Net sales increased 23% year over year to $515 million on a reported basis and rose 16% organically, primarily driven by favorable pricing and incremental volumes supported by strong data center demand. Acquisitions contributed $31 million in incremental sales, accounting for 7% of reported growth. Segment margin expanded 80 basis points (bps) as benefits from price realization, productivity improvements and volume leverage more than offset the impacts of inflation, tariffs and acquisition-related dilution.

Europe: Net sales increased 12% year over year to $121 million on a reported basis and grew 1% organically. Reported sales growth benefited from favorable foreign exchange, which contributed 11% to reported results. Organic sales growth was primarily driven by favorable pricing, which offset a modest decline in volumes. Segment margin contracted 20 bps as gains from price realization, productivity initiatives and restructuring actions were more than offset by inflationary pressures and volume deleverage.

APMEA: Net sales increased 29% year over year to $41 million on a reported basis and rose 3% organically, driven by growth in China, Australia and New Zealand, partially offset by weakness in the Middle East. Acquisitions contributed $6 million, or 19%, to reported sales growth, while favorable foreign exchange added 7%. Segment margin expanded 120 bps, supported by trade sales volume leverage, productivity gains and acquisition accretion, which more than offset inflation and affiliate volume deleverage.

Other Details

Gross profit increased 19.7% year over year to $326.1 million. Selling, general and administrative expenses rose 15.2% to $192.9 million. Operating income was $133 million, up 51.7% year over year. Adjusted operating income was $135.9 million, up 28.1% year over year.

Operating margin expanded 390 bps to 19.6%. The adjusted operating margin was 20.1%, up 110 bps year over year. Margin performance was driven by favorable pricing, productivity improvements and volume leverage, which more than offset the impacts of inflation, investments, tariffs and acquisition-related dilution. Operating margin also benefited from lower restructuring charges, partially offset by higher acquisition-related expenses.

Cash Flow & Liquidity

For the first quarter ended March 29, 2026, Watts Water generated $17.9 million of cash from operating activities compared with $55.2 million in the prior-year period.

For the first quarter, free cash flow was $6.6 million compared with $45.6 million a year ago.

Free cash flow declined primarily due to higher capital expenditures and elevated working capital levels, which more than offset the benefit of increased net income. The rise in working capital was driven by higher accounts receivable linked to stronger net sales, increased inventory levels resulting from incremental tariffs and strategic inventory investments to support anticipated end-market demand, as well as higher annual customer rebates tied to sales growth and payment timing. Management expects free cash flow to improve sequentially through 2026 as working capital is gradually monetized in line with normal business seasonality.

On May 4, 2026, the company announced a 21% increase in its quarterly dividend, raising the payout from 52 cents per share to 63 cents, effective June 2026.

During the first quarter of 2026, the company also repurchased nearly 13,000 shares for approximately $3.8 million. As of quarter-end, about $125 million remained available under the share repurchase program authorized in 2023, which has no expiration date.

As of March 29, 2026, the company had $374.7 million in cash and cash equivalents with $197.8 million of long-term debt compared with the respective figures of $405.5 million and $197.7 million as of Dec 31, 2025.

Q2 & 2026 Guidance by WTS

For 2026, the company maintained its prior outlook and continues to expect reported sales growth in the range of 8% to 12%, with organic sales growth projected between 2% and 6%.

Watts Water expects adjusted EBITDA margin to be between 21.5% and 22.1%, representing a change of down 40 bps to up 20 bps year over year.

The company anticipates operating margin to be between 18.8% and 19.4%, reflecting an expansion of 40-100 bps, while adjusted operating margin is forecast at 19.1% to 19.7%, implying a decline of 50 bps to an increase of 10 bps.

For the second quarter of 2026, Watts Water expects reported sales growth of 10% to 14% and organic sales growth of 4% to 8%. Adjusted EBITDA margin is projected between 22.3% and 22.9%, while adjusted operating margin is expected in the range of 20% to 20.6%.

How Have Estimates Been Moving Since Then?Since the earnings release, investors have witnessed a upward trend in fresh estimates.

VGM ScoresCurrently, Watts Water has a subpar Growth Score of D, however its Momentum Score is doing a bit better with a C. Charting a somewhat similar path, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for value investors.

Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.

OutlookEstimates have been broadly trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise Watts Water has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.

Performance of an Industry PlayerWatts Water is part of the Zacks Manufacturing - General Industrial industry. Over the past month, Crane (CR - Free Report) , a stock from the same industry, has gained 3.6%. The company reported its results for the quarter ended March 2026 more than a month ago.

Crane reported revenues of $696.4 million in the last reported quarter, representing a year-over-year change of +24.9%. EPS of $1.65 for the same period compares with $1.39 a year ago.

Crane is expected to post earnings of $1.65 per share for the current quarter, representing a year-over-year change of +10.7%. Over the last 30 days, the Zacks Consensus Estimate remained unchanged.

Crane has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of D.