A. O. Smith (NYSE:AOS) Trading Down 5.7% - What's Next?

Key Points

• Shares fell 5.7% intraday to about $63.15 on Wednesday, trading as low as $63.47 with volume (~669,294 shares) roughly 52% below the average session volume.
• Analysts’ views are mixed with a consensus "Hold" rating and an average price target of $74.89; several firms cut targets recently, including Goldman Sachs to $61 with a sell, while Stifel still has a $78 buy.
• A. O. Smith beat quarterly EPS estimates ($0.90 vs. $0.84) but missed revenue expectations, and declared a quarterly dividend of $0.36 (annualized $1.44, ~2.3% yield) payable May 15 (ex-dividend April 30).

A. O. Smith Corporation (NYSE:AOS - Get Free Report)'s stock price traded down 5.7% during mid-day trading on Wednesday . The company traded as low as $63.47 and last traded at $63.1480. 669,294 shares changed hands during trading, a decline of 52% from the average session volume of 1,398,729 shares. The stock had previously closed at $66.93.

Analyst Ratings Changes

A number of equities research analysts have recently weighed in on AOS shares. Stifel Nicolaus set a $78.00 price objective on A. O. Smith and gave the stock a "buy" rating in a research report on Tuesday. Citigroup decreased their target price on A. O. Smith from $78.00 to $74.00 and set a "neutral" rating for the company in a report on Monday. Wall Street Zen cut shares of A. O. Smith from a "buy" rating to a "hold" rating in a report on Saturday, February 14th. Jefferies Financial Group set a $75.00 price objective on shares of A. O. Smith and gave the company a "hold" rating in a research report on Friday, January 9th. Finally, The Goldman Sachs Group decreased their price objective on shares of A. O. Smith from $69.00 to $61.00 and set a "sell" rating for the company in a report on Monday. Two equities research analysts have rated the stock with a Buy rating, seven have given a Hold rating and one has given a Sell rating to the stock. Based on data from MarketBeat, the stock currently has a consensus rating of "Hold" and an average price target of $74.89.

A. O. Smith Price Performance

The company has a quick ratio of 0.94, a current ratio of 1.50 and a debt-to-equity ratio of 0.06. The firm's 50-day moving average is $71.30 and its 200-day moving average is $69.56. The company has a market cap of $8.73 billion, a PE ratio of 16.34, a PEG ratio of 1.39 and a beta of 1.35.

A. O. Smith (NYSE:AOS - Get Free Report) last announced its quarterly earnings results on Thursday, January 29th. The industrial products company reported $0.90 earnings per share (EPS) for the quarter, beating the consensus estimate of $0.84 by $0.06. The company had revenue of $912.50 million for the quarter, compared to analysts' expectations of $928.97 million. A. O. Smith had a net margin of 14.26% and a return on equity of 29.51%. A. O. Smith's quarterly revenue was up .0% on a year-over-year basis. During the same quarter in the previous year, the company earned $0.85 earnings per share. On average, equities analysts anticipate that A. O. Smith Corporation will post 3.76 EPS for the current year.

A. O. Smith Announces Dividend

The firm also recently declared a quarterly dividend, which will be paid on Friday, May 15th. Investors of record on Thursday, April 30th will be paid a $0.36 dividend. This represents a $1.44 annualized dividend and a dividend yield of 2.3%. The ex-dividend date is Thursday, April 30th. A. O. Smith's dividend payout ratio (DPR) is presently 37.31%.

Insider Buying and Selling

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

Institutional Investors Weigh In On A. O. Smith

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

A. O. Smith Company Profile

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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