A. O. Smith Corporation (NYSE:AOS) Receives Consensus Recommendation of "Reduce" from Analysts

Key Points

• Analyst sentiment is bearish: A. O. Smith has a consensus recommendation of “Reduce” from 11 brokerages, with three sell ratings, six hold ratings, and two buy ratings. The average price target across updated coverage is about $69.89.
• Earnings expectations were cut: Zacks Research lowered its FY2026 EPS estimate to $3.79 from $4.01, and also trimmed FY2027 and FY2028 forecasts. Quarterly estimates were reduced across multiple periods as well, reinforcing a softer outlook for future profitability.
• Recent results missed expectations: A. O. Smith reported $0.85 EPS on revenue of $945.6 million for the latest quarter, both below analyst estimates. The company also maintained FY2026 guidance of $3.60 to $3.90 EPS and recently paid a quarterly dividend of $0.36 per share.

A. O. Smith Corporation (NYSE:AOS - Get Free Report) has earned a consensus recommendation of "Reduce" from the eleven brokerages that are covering the company, MarketBeat Ratings reports. Three analysts have rated the stock with a sell rating, six have given a hold rating and two have issued a buy rating on the company. The average 1 year price target among brokerages that have updated their coverage on the stock in the last year is $69.8889.

AOS has been the topic of a number of research analyst reports. JPMorgan Chase & Co. restated an "underweight" rating and issued a $60.00 target price (down from $65.00) on shares of A. O. Smith in a research note on Friday, May 15th. Wall Street Zen downgraded A. O. Smith from a "buy" rating to a "hold" rating in a research note on Saturday, February 14th. Stifel Nicolaus set a $75.00 target price on A. O. Smith in a research note on Friday, May 1st. DA Davidson set a $67.00 target price on A. O. Smith and gave the stock a "neutral" rating in a research note on Monday, May 4th. Finally, Robert W. Baird set a $70.00 target price on A. O. Smith in a research note on Friday, May 1st.

Insider Buying and Selling

In related news, SVP Darrell W. Schuh sold 1,104 shares of the company's stock in a transaction that occurred on Wednesday, March 4th. The stock was sold at an average price of $74.39, for a total value of $82,126.56. Following the transaction, the senior vice president owned 2,201 shares in the company, valued at approximately $163,732.39. This represents a 33.40% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through this link. Insiders own 0.50% of the company's stock.

Hedge Funds Weigh In On A. O. Smith

Institutional investors have recently bought and sold shares of the company. Rothschild Investment LLC lifted its stake in A. O. Smith by 3,125.0% in the third quarter. Rothschild Investment LLC now owns 387 shares of the industrial products company's stock valued at $28,000 after purchasing an additional 375 shares during the last quarter. Creative Financial Designs Inc. ADV lifted its stake in A. O. Smith by 3,481.8% in the fourth quarter. Creative Financial Designs Inc. ADV now owns 394 shares of the industrial products company's stock valued at $26,000 after purchasing an additional 383 shares during the last quarter. Root Financial Partners LLC purchased a new position in A. O. Smith in the third quarter valued at approximately $33,000. Torren Management LLC purchased a new position in A. O. Smith in the fourth quarter valued at approximately $31,000. Finally, Eagle Bay Advisors LLC purchased a new position in A. O. Smith in the fourth quarter valued at approximately $32,000. Hedge funds and other institutional investors own 76.10% of the company's stock.

Key A. O. Smith News

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

• Negative Sentiment: Zacks Research cut A. O. Smith’s FY2026 EPS estimate to $3.79 from $4.01, signaling weaker expected full-year profitability. Article Title
• Negative Sentiment: The firm also lowered FY2027 EPS to $4.12 from $4.37 and FY2028 EPS to $4.61 from $4.87, suggesting softer longer-term earnings growth expectations.
• Negative Sentiment: Quarterly estimates were trimmed across several periods, including Q2 2026 ($1.01 vs. $1.10), Q3 2026 ($0.96 vs. $0.99), Q1 2027 ($0.98 vs. $1.04), Q2 2027 ($1.09 vs. $1.20), Q3 2027 ($1.04 vs. $1.09), and Q4 2027 ($1.01 vs. $1.05), reinforcing the bearish tone.
• Neutral Sentiment: Zacks Research kept a Strong Sell rating on AOS, which adds to sentiment headwinds but does not by itself change fundamentals.
• Neutral Sentiment: The new estimates are still close to the current consensus FY2026 EPS of $3.78, so the market may be focused more on the downgrade trend than on a dramatic forecast miss.

A. O. Smith Price Performance

Shares of NYSE AOS opened at $57.34 on Friday. A. O. Smith has a twelve month low of $54.16 and a twelve month high of $81.86. The stock's 50 day moving average price is $63.05 and its 200-day moving average price is $67.93. The company has a market capitalization of $7.90 billion, a PE ratio of 15.25, a PEG ratio of 1.26 and a beta of 1.23. The company has a quick ratio of 1.00, a current ratio of 1.56 and a debt-to-equity ratio of 0.31.

A. O. Smith (NYSE:AOS - Get Free Report) last announced its earnings results on Thursday, April 30th. The industrial products company reported $0.85 earnings per share for the quarter, missing analysts' consensus estimates of $0.94 by ($0.09). A. O. Smith had a return on equity of 28.42% and a net margin of 13.84%.The business had revenue of $945.60 million during the quarter, compared to analysts' expectations of $974.06 million. During the same quarter in the previous year, the firm earned $0.95 EPS. A. O. Smith's quarterly revenue was down 1.9% on a year-over-year basis. A. O. Smith has set its FY 2026 guidance at 3.600-3.900 EPS. On average, equities analysts anticipate that A. O. Smith will post 3.78 EPS for the current year.

A. O. Smith Dividend Announcement

The company also recently disclosed a quarterly dividend, which was paid on Friday, May 15th. Investors of record on Thursday, April 30th were paid a $0.36 dividend. The ex-dividend date was Thursday, April 30th. This represents a $1.44 annualized dividend and a yield of 2.5%. A. O. Smith's dividend payout ratio is presently 38.30%.

About A. O. Smith

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

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

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