Watts Water Technologies, Inc. (NYSE:WTS) Sees Significant Drop in Short Interest

Key Points

• Short interest in Watts Water Technologies fell sharply in June, dropping 45.1% to 824,963 shares as of June 30. That amounts to about 2.5% of shares outstanding and roughly 1.0 day to cover.
• The company posted strong recent results, beating quarterly EPS expectations with $3.04 per share versus $2.72 expected, and revenue rose 21.4% year over year to $677.3 million.
• Analysts remain cautious overall: despite several price target increases, the stock’s consensus rating is still “Hold,” with an average target price of $340.20.

Watts Water Technologies, Inc. (NYSE:WTS - Get Free Report) saw a large decrease in short interest in June. As of June 30th, there was short interest totaling 824,963 shares, a decrease of 45.1% from the June 15th total of 1,502,348 shares. Approximately 2.5% of the shares of the stock are sold short. Based on an average daily volume of 789,926 shares, the days-to-cover ratio is currently 1.0 days.

Analyst Upgrades and Downgrades

WTS has been the subject of several research analyst reports. Weiss Ratings downgraded Watts Water Technologies from a "buy (b+)" rating to a "buy (b)" rating in a research note on Monday, May 11th. Royal Bank Of Canada boosted their target price on shares of Watts Water Technologies from $318.00 to $323.00 and gave the stock a "sector perform" rating in a research note on Friday, May 8th. Deutsche Bank Aktiengesellschaft restated a "hold" rating and set a $358.00 price objective on shares of Watts Water Technologies in a research report on Friday, May 8th. Stifel Nicolaus set a $379.00 price target on Watts Water Technologies in a report on Friday, May 8th. Finally, TD Cowen boosted their target price on shares of Watts Water Technologies from $275.00 to $320.00 and gave the stock a "hold" rating in a report on Thursday, July 2nd. Five equities research analysts have rated the stock with a Buy rating and six have issued a Hold rating to the company. Based on data from MarketBeat.com, the stock presently has an average rating of "Hold" and an average target price of $340.20.

Watts Water Technologies Stock Up 0.9%

Shares of Watts Water Technologies stock opened at $349.95 on Wednesday. The stock's 50-day moving average is $328.25 and its 200 day moving average is $311.14. Watts Water Technologies has a one year low of $242.77 and a one year high of $394.54. The firm has a market cap of $11.68 billion, a price-to-earnings ratio of 32.02, a PEG ratio of 3.05 and a beta of 1.14. The company has a debt-to-equity ratio of 0.09, a current ratio of 2.72 and a quick ratio of 1.62.

Watts Water Technologies (NYSE:WTS - Get Free Report) last released its earnings results on Wednesday, May 6th. The technology company reported $3.04 earnings per share (EPS) for the quarter, beating analysts' consensus estimates of $2.72 by $0.32. Watts Water Technologies had a net margin of 14.32% and a return on equity of 18.92%. The company had revenue of $677.30 million for the quarter, compared to the consensus estimate of $638.13 million. During the same quarter in the previous year, the company earned $2.37 EPS. Watts Water Technologies's quarterly revenue was up 21.4% compared to the same quarter last year. Equities research analysts anticipate that Watts Water Technologies will post 12.03 EPS for the current year.

Watts Water Technologies Announces Dividend

The firm also recently announced a quarterly dividend, which was paid on Monday, June 15th. Stockholders of record on Monday, June 1st were given a dividend of $0.63 per share. The ex-dividend date of this dividend was Monday, June 1st. This represents a $2.52 annualized dividend and a dividend yield of 0.7%. Watts Water Technologies's payout ratio is presently 23.06%.

Insider Transactions at Watts Water Technologies

In related news, Director Michael J. Dubose sold 398 shares of the stock in a transaction that occurred on Thursday, May 28th. The shares were sold at an average price of $309.63, for a total transaction of $123,232.74. Following the sale, the director owned 1,814 shares in the company, valued at approximately $561,668.82. This trade represents a 17.99% decrease in their position. The transaction was disclosed in a legal filing with the SEC, which is accessible through this link. Also, insider Elie Melhem sold 2,257 shares of the company's stock in a transaction on Wednesday, May 13th. The stock was sold at an average price of $301.00, for a total value of $679,357.00. Following the sale, the insider owned 8,963 shares of the company's stock, valued at $2,697,863. The trade was a 20.12% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. 1.00% of the stock is owned by insiders.

Institutional Trading of Watts Water Technologies

A number of hedge funds and other institutional investors have recently added to or reduced their stakes in WTS. Wexford Capital LP bought a new stake in shares of Watts Water Technologies in the 3rd quarter worth $26,000. Acumen Wealth Advisors LLC bought a new position in shares of Watts Water Technologies during the fourth quarter valued at about $28,000. Clearstead Advisors LLC boosted its holdings in Watts Water Technologies by 69.4% during the fourth quarter. Clearstead Advisors LLC now owns 105 shares of the technology company's stock worth $29,000 after purchasing an additional 43 shares during the last quarter. Advisory Services Network LLC purchased a new position in Watts Water Technologies during the third quarter worth about $29,000. Finally, Kemnay Advisory Services Inc. bought a new stake in Watts Water Technologies in the 4th quarter worth about $29,000. 95.02% of the stock is owned by institutional investors.

About Watts Water Technologies

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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