A. O. Smith Corporation (AOS)

FairStock Score: 73/100 — STEADY

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

I seek a business with durable demand, honest accounting, and a price that leaves room for error. A. O. Smith makes water heaters, boilers, and water-treatment equipment, ordinary products with replacement demand that can create a modest moat when brands and distribution are strong. Financially, it is sturdy: at the close on 2026-10-13, FairStock shows a 2.53% dividend yield, 27.13% ROE, 12.54% ROCE, debt-to-equity of 0.37, and an 8.0% free-cash-flow yield. In fiscal 2025, the year ended 2025-12-31, it reported revenue of $3.8B, net income of $546.2M, and diluted EPS of $3.85. That was slightly better than fiscal 2024's $533.6M net income and $3.63 EPS, but below fiscal 2023's $556.6M net income and $3.69 EPS. More recently, in fiscal Q2 2026, the quarter ended 2026-06-30, revenue was $1.0B and net income was $124.9M, or $0.91 per diluted share, down from $152.2M and $1.07 in fiscal Q2 2025, the quarter ended 2025-06-30. The FairStock Lynch category is STALWART, steady long-term growth, with profit compounding 9.6% a year over five years and revenue 5.8%, but the latest figures show pressure. Valuation is the rub: FairStock's P/E is 16.13 and P/B is 4.27, while its Graham Number is $32.75, so the price sits far above that conservative value marker. With a FairStock score of 73/100 and Altman Z-Score of 4.85, this is a quality business, but not an obvious bargain.

In plain English: A. O. Smith makes water heaters, boilers and water-treatment products for homes and businesses. The company still earns solid profits and uses only modest debt, but profit fell in the latest quarter from a year earlier. At the 2026-10-13 close, the shares look expensive compared with the company's earnings and a conservative value estimate, even though it generates plenty of cash.

The full AI analysis, bull and bear case and key monitorables are in FairStock Pro.

Data as of 2026-10-13 close · note generated 2026-10-15 · model deepseek-flash

Sources (SEC EDGAR): fiscal Q2 2026 10-Q (period ended 2026-06-30) · fiscal Q1 2026 10-Q (period ended 2026-03-31) · fiscal Q3 2025 10-Q (period ended 2025-09-30) · fiscal Q2 2025 10-Q (period ended 2025-06-30) · FY2025 10-K (period ended 2025-12-31) · FY2024 10-K (period ended 2024-12-31) · FY2023 10-K (period ended 2023-12-31)

Fundamentals from company filings and market-data providers; prices are end-of-day, not real-time. AI-generated analysis is general and educational — not personal investment advice. Scoring methodology · Score test · Disclaimer