[Executive Summary & Q2 Highlights](index=1&type=section&id=Executive%20Summary%20%26%20Q2%20Highlights) This section provides an overview of Q2 2025 financial results, key performance indicators, and strategic initiatives, including the assessment of the China business [Q2 2025 Financial Performance](index=1&type=section&id=Q2%202025%20Financial%20Performance) A. O. Smith reported Q2 2025 diluted EPS of $1.07, a 1% YoY increase, despite a 1% decline in net sales to $1.01 billion and a 3% decrease in net earnings to $152.2 million. North America operating margin improved to 25.4%, and Rest of World operating margin showed sequential improvement to 10.5% Q2 2025 Financial Highlights | | Q2 2025 (millions USD) | Q2 2024 (millions USD) | % Change YoY | | --- | --- | --- | --- | | Net sales | $1,011.3 | $1,024.3 | -1% | | Net earnings | $152.2 | $156.2 | -3% | | Diluted earnings per share | $1.07 | $1.06 | 1% | - North America operating margin increased **30 basis points to 25.4%**[3](index=3&type=chunk) - Rest of World operating margin continued sequential improvement to **10.5%**[3](index=3&type=chunk) [Strategic Initiatives and CEO Commentary](index=1&type=section&id=Strategic%20Initiatives%20and%20CEO%20Commentary) CEO Steve Shafer highlighted steady growth in commercial boilers and North America water heater volumes, alongside strong growth in India. The company is initiating a formal assessment of its China business to explore strategic opportunities, including partnerships, to drive greater value through operational excellence, innovation, and portfolio management - Initiating assessment of strategic opportunities for **China business**[3](index=3&type=chunk)[4](index=4&type=chunk) - New CEO Steve Shafer focuses on improved operational excellence, breakthrough innovation, and portfolio management[4](index=4&type=chunk) - Legacy India business grew **19% in local currency**, and Pureit, a recent acquisition in India, contributed **$16 million in sales**[4](index=4&type=chunk) [Segment-level Performance](index=2&type=section&id=Segment-level%20Performance) This section details the financial performance of the North America and Rest of World segments, highlighting regional sales, earnings, and margin trends [North America Segment](index=2&type=section&id=North%20America) North America sales decreased 1% to $779.0 million compared to a challenging prior year, as higher boiler sales were offset by lower water heater volumes. Segment earnings remained essentially flat at $198.1 million, but segment margin expanded 30 basis points to 25.4%, driven by mix benefits from water treatment and high-efficiency water heaters North America Segment Performance | Metric | Q2 2025 (millions USD) | Q2 2024 (millions USD) | | :--- | :--- | :--- | | Sales | $779.0 | $790.7 | | Earnings | $198.1 | $198.4 | | Segment Margin | 25.4% | 25.1% | - Improved segment operating margin was driven by mix benefits from the water treatment priority channel strategy and growth in high efficiency water heaters[6](index=6&type=chunk) [Rest of World Segment](index=2&type=section&id=Rest%20of%20World) Rest of World sales decreased 2% to $240.1 million, primarily due to an 11% decline in China sales (local currency), largely offset by 19% organic sales growth in India and a $16 million contribution from the Pureit acquisition. Segment earnings were $25.3 million, with margin at 10.5%, remaining relatively flat due to restructuring and cost reduction actions offsetting lower China volumes Rest of World Segment Performance | Metric | Q2 2025 (millions USD) | Q2 2024 (millions USD) | | :--- | :--- | :--- | | Sales | $240.1 | $244.8 | | Earnings | $25.3 | $25.9 | | Segment Margin | 10.5% | 10.6% | - **China sales decreased 11%** in local currency year-over-year[7](index=7&type=chunk) - Organic sales in India grew **19% in local currency**, and Pureit contributed **$16 million to sales** in the second quarter of 2025[7](index=7&type=chunk) [Financial Position & Capital Allocation](index=3&type=section&id=Balance%20Sheet%2C%20Liquidity%20and%20Capital%20Allocation) Overview of the company's balance sheet, liquidity, cash flow generation, and strategies for returning capital to shareholders [Balance Sheet and Liquidity](index=3&type=section&id=Balance%20Sheet%20and%20Liquidity) As of June 30, 2025, the company maintained a strong liquidity position with $177.9 million in cash and marketable securities and total debt of $303.4 million, resulting in a low leverage ratio of 14.1% as measured by total debt-to-total capitalization Key Balance Sheet and Liquidity Metrics | Metric (as of June 30, 2025) | Amount (millions USD) | | :--- | :--- | | Cash and marketable securities | $177.9 | | Total debt | $303.4 | | Leverage ratio (total debt-to-total capitalization) | 14.1% | [Cash Flow and Shareholder Returns](index=3&type=section&id=Cash%20Flow%20and%20Shareholder%20Returns) Cash provided by operations increased to $178.3 million and free cash flow to $139.9 million in the first six months of 2025, primarily due to lower working capital outlays. The company returned capital to shareholders by repurchasing $251.3 million of shares and approving a $0.34 per share dividend Cash Flow Performance | Metric (Six Months Ended June 30) | 2025 (millions USD) | 2024 (millions USD) | | :--- | :--- | :--- | | Cash provided by operations | $178.3 | $164.0 | | Free cash flow | $139.9 | $119.1 | - The Company repurchased **3.8 million shares** at a cost of **$251.3 million** in the first six months of 2025[11](index=11&type=chunk) - The Company's board of directors approved a **$0.34 per share dividend** for shareholders of record on July 31, payable on Aug. 15[11](index=11&type=chunk) [Full Year Outlook](index=3&type=section&id=Outlook) This section presents the updated full-year 2025 guidance for sales and diluted EPS, reflecting market confidence and operational benefits [2025 Guidance](index=3&type=section&id=2025%20Outlook) A. O. Smith raised its full-year 2025 sales outlook to grow between 1% and 3% and the midpoint of its diluted EPS outlook to a range of $3.70 to $3.90. This reflects confidence in managing tariffs, expected improved market share, and ongoing benefits from 2024 restructuring actions. The guidance excludes potential impacts from future acquisitions and the China business assessment Full Year 2025 Outlook | Metric | 2024 Actual (millions USD) | 2025 Outlook (Low End, millions USD) | 2025 Outlook (High End, millions USD) | | :--- | :--- | :--- | :--- | | Net sales | $3,818 | $3,850 | $3,930 | | Diluted earnings per share | $3.63 | $3.70 | $3.90 | | Adjusted earnings per share | $3.73 | $3.70 | $3.90 | - Consolidated sales are expected to grow between **1% and 3%**[3](index=3&type=chunk)[12](index=12&type=chunk) - Diluted EPS is projected with a range of **$3.70 to $3.90**[3](index=3&type=chunk)[12](index=12&type=chunk) - The Company's guidance excludes the potential impacts from future acquisitions and any potential outcomes of the assessment of its China business[13](index=13&type=chunk) [Additional Information](index=3&type=section&id=Additional%20Information) This section clarifies non-GAAP financial measures, outlines forward-looking statement risks, and provides a brief company overview [Non-GAAP Financial Measures](index=3&type=section&id=Non-GAAP%20Financial%20Measures) The company provides non-GAAP measures like free cash flow (cash provided by operations less capital expenditures) and adjusted earnings/EPS (excluding restructuring and impairment charges) to offer improved transparency into its operating results - Free cash flow is defined as cash provided by operations less capital expenditures[15](index=15&type=chunk) - Adjusted earnings, adjusted EPS, adjusted segment earnings and adjusted corporate expenses exclude the impact of restructuring and impairment charges[15](index=15&type=chunk) [Forward-Looking Statements](index=4&type=section&id=Forward-looking%20Statements) This section outlines various risks and uncertainties that could cause actual results to differ materially from forward-looking statements, including international tariffs, softening demand, global inflationary pressures, supply chain issues, economic conditions in China, and competitive pressures - Forward-looking statements are subject to risks such as international tariffs, global inflationary pressures, supply chain issues, and economic conditions in China[16](index=16&type=chunk) - Uncertain outcomes and costs and other potential impacts of the Company's assessment relating to the Company's China business are identified as important factors[16](index=16&type=chunk) [About A. O. Smith](index=4&type=section&id=About%20A.%20O.%20Smith) A. O. Smith Corporation, headquartered in Milwaukee, Wisconsin, is a global leader applying innovative technology and energy-efficient solutions to products manufactured and marketed worldwide, specializing in residential and commercial water heating equipment, boilers, and water treatment products - A. O. Smith is a global leader in residential and commercial water heating equipment and boilers, as well as a manufacturer of water treatment products[17](index=17&type=chunk) [Financial Statements](index=5&type=section&id=Financial%20Statements) This section includes the condensed consolidated statements of earnings, balance sheet, and cash flows for the reported periods [Condensed Consolidated Statement of Earnings](index=5&type=section&id=Condensed%20Consolidated%20Statement%20of%20Earnings) This statement presents the company's revenues, costs, and profits for the three and six months ended June 30, 2025, and 2024, showing net sales of $1,011.3 million and net earnings of $152.2 million for Q2 2025 Condensed Consolidated Statement of Earnings (millions USD, except per share data) | | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Net sales | $1,011.3 | $1,024.3 | $1,975.2 | $2,003.1 | | Cost of products sold | 614.2 | 628.3 | 1,202.7 | 1,222.4 | | Gross profit | 397.1 | 396.0 | 772.5 | 780.7 | | Selling, general and administrative expenses | 191.3 | 188.5 | 383.9 | 380.7 | | Interest expense | 4.6 | 1.8 | 7.5 | 2.8 | | Other income, net | (0.4) | (0.9) | (1.6) | (2.1) | | Earnings before provision for income taxes | 201.6 | 206.6 | 382.7 | 399.3 | | Provision for income taxes | 49.4 | 50.4 | 93.9 | 95.5 | | Net earnings | $152.2 | $156.2 | $288.8 | $303.8 | | Diluted earnings per share of common stock | $1.07 | $1.06 | $2.01 | $2.05 | | Average common shares outstanding (000's omitted) | 142,484 | 147,600 | 143,440 | 147,949 | [Condensed Consolidated Balance Sheet](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheet) This statement details the company's assets, liabilities, and stockholders' equity as of June 30, 2025, and December 31, 2024, showing total assets of $3,246.7 million at the end of Q2 2025 Condensed Consolidated Balance Sheet (millions USD) | ASSETS: | June 30, 2025 (millions USD) | December 31, 2024 (millions USD) | | :--- | :--- | :--- | | Cash and cash equivalents | $177.9 | $239.6 | | Marketable securities | — | 36.5 | | Receivables | 640.3 | 541.4 | | Inventories | 519.3 | 532.1 | | Other current assets | 51.0 | 43.3 | | **Total Current Assets** | **1,388.5** | **1,392.9** | | Net property, plant and equipment | 637.1 | 628.7 | | Goodwill and other intangibles | 1,085.6 | 1,082.8 | | Operating lease assets | 37.4 | 32.8 | | Other assets | 98.1 | 102.8 | | **Total Assets** | **$3,246.7** | **$3,240.0** | | LIABILITIES AND STOCKHOLDERS' EQUITY: | | | | Trade payables | $521.8 | $588.7 | | Accrued payroll and benefits | 80.2 | 78.5 | | Accrued liabilities | 148.3 | 153.0 | | Product warranties | 73.5 | 67.0 | | Debt due within one year | 19.2 | 10.0 | | **Total Current Liabilities** | **843.0** | **897.2** | | Long-term debt | 284.2 | 183.2 | | Operating lease liabilities | 28.2 | 23.5 | | Other liabilities | 245.4 | 252.6 | | Stockholders' equity | 1,845.9 | 1,883.5 | | **Total Liabilities and Stockholders' Equity** | **$3,246.7** | **$3,240.0** | [Condensed Consolidated Statement of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statement%20of%20Cash%20Flows) This statement outlines the cash inflows and outflows from operating, investing, and financing activities for the six months ended June 30, 2025, and 2024, showing cash provided by operating activities of $178.3 million for the first six months of 2025 Condensed Consolidated Statement of Cash Flows (millions USD) | Six Months Ended June 30, | 2025 (millions USD) | 2024 (millions USD) | | :--- | :--- | :--- | | **Operating Activities** | | | | Net earnings | $288.8 | $303.8 | | Depreciation & amortization | 41.2 | 39.2 | | Share based compensation expense | 8.6 | 10.4 | | Deferred income taxes | (9.1) | (1.5) | | Net changes in operating assets and liabilities: | | | | Current assets and liabilities | (159.0) | (173.2) | | Noncurrent assets and liabilities | 7.8 | (14.7) | | **Cash Provided by Operating Activities** | **178.3** | **164.0** | | **Investing Activities** | | | | Capital expenditures | (38.4) | (44.9) | | Acquisitions | — | (21.3) | | Investment in marketable securities | (22.6) | (50.9) | | Net proceeds from sale of marketable securities | 59.2 | 57.0 | | **Cash Used in Investing Activities** | **(1.8)** | **(60.1)** | | **Financing Activities** | | | | Long-term debt incurred | 108.2 | 14.3 | | Common stock repurchases | (251.3) | (153.2) | | Net (payments) proceeds from stock option activity | (0.5) | 9.4 | | Dividends paid | (97.5) | (94.2) | | **Cash Used in Financing Activities** | **(241.1)** | **(223.7)** | | Effect of exchange rate changes on cash and cash equivalents | 2.9 | (4.0) | | Net decrease in cash and cash equivalents | (61.7) | (123.8) | | Cash and cash equivalents - beginning of period | 239.6 | 339.9 | | **Cash and Cash Equivalents - End of Period** | **$177.9** | **$216.1** | [Business Segments Data](index=8&type=section&id=Business%20Segments) This section provides a breakdown of net sales and earnings for the North America and Rest of World segments for the three and six months ended June 30, 2025, and 2024, including inter-segment eliminations and corporate expenses Net Sales by Business Segment (millions USD) | Net sales | Three Months Ended June 30, 2025 (millions USD) | Three Months Ended June 30, 2024 (millions USD) | Six Months Ended June 30, 2025 (millions USD) | Six Months Ended June 30, 2024 (millions USD) | | :--- | :--- | :--- | :--- | :--- | | North America | $779.0 | $790.7 | $1,527.7 | $1,557.0 | | Rest of World | 240.1 | 244.8 | 466.8 | 471.7 | | Inter-segment sales | (7.8) | (11.2) | (19.3) | (25.6) | | **Total Net Sales** | **$1,011.3** | **$1,024.3** | **$1,975.2** | **$2,003.1** | Earnings by Business Segment (millions USD) | Earnings | Three Months Ended June 30, 2025 (millions USD) | Three Months Ended June 30, 2024 (millions USD) | Six Months Ended June 30, 2025 (millions USD) | Six Months Ended June 30, 2024 (millions USD) | | :--- | :--- | :--- | :--- | :--- | | North America | $198.1 | $198.4 | $383.3 | $397.1 | | Rest of World | 25.3 | 25.9 | 45.0 | 43.1 | | Inter-segment earnings elimination | (0.2) | (0.1) | (0.2) | (0.4) | | Corporate expense | (17.0) | (15.8) | (37.9) | (37.7) | | Interest expense | (4.6) | (1.8) | (7.5) | (2.8) | | Earnings before income taxes | 201.6 | 206.6 | 382.7 | 399.3 | | Provision for incomes taxes | 49.4 | 50.4 | 93.9 | 95.5 | | **Net earnings** | **$152.2** | **$156.2** | **$288.8** | **$303.8** | [Non-GAAP Reconciliations](index=9&type=section&id=Non-GAAP%20Reconciliations) This section provides reconciliations from GAAP measures to non-GAAP measures, specifically for free cash flow and adjusted EPS, offering a clearer view of operational performance by excluding certain charges Free Cash Flow Reconciliation (millions USD) | Free Cash Flow (Six Months Ended June 30) | 2025 (millions USD) | 2024 (millions USD) | | :--- | :--- | :--- | | Cash provided by operating activities (GAAP) | $178.3 | $164.0 | | Less: Capital expenditures | (38.4) | (44.9) | | **Free cash flow (non-GAAP)** | **$139.9** | **$119.1** | Adjusted EPS Reconciliation (USD per share) | EPS Guidance and Adjusted EPS | 2025 Guidance (USD) | 2024 (USD) | | :--- | :--- | :--- | | Diluted EPS (GAAP) | $3.70-3.90 | $3.63 | | Restructuring and impairment expense | — | 0.10 | | **Adjusted EPS (non-GAAP)** | **$3.70-3.90** | **$3.73** |

Core Insights - A. O. Smith Corporation reported second quarter 2025 net sales of $1,011.3 million, a decrease of 1% compared to $1,024.3 million in Q2 2024, with net earnings of $152.2 million, down 3% from $156.2 million in the prior year [1][3] - The company experienced growth in commercial boilers and North America water heater volumes, while facing challenges in the China market and lower water heater volumes in North America [1][5] - A formal assessment of the China business is being initiated to explore strategic opportunities, reflecting the company's commitment to realizing long-term prospects in that market [1][12] Key Financial Metrics - Net sales for Q2 2025 were $1,011.3 million, compared to $1,024.3 million in Q2 2024, representing a 1% decline [1][3] - Net earnings were $152.2 million, down from $156.2 million, while diluted earnings per share increased slightly to $1.07 from $1.06 [1][3] - The North America operating margin increased by 30 basis points to 25.4%, and the Rest of World operating margin improved sequentially to 10.5% [3][4] Segment Performance - North America sales were $779.0 million, a decrease of 1% year-over-year, primarily due to lower water heater volumes despite higher boiler sales [2][22] - Rest of World sales totaled $240.1 million, down 2% from $244.8 million, with China sales decreasing by 11% in local currency, while India saw a 19% growth in local currency [5][22] - Segment earnings for North America were $198.1 million, essentially flat compared to $198.4 million in the prior year, while Rest of World segment earnings were $25.3 million, slightly down from $25.9 million [4][6] Cash Flow and Capital Allocation - Cash provided by operations was $178.3 million, with free cash flow of $139.9 million for the first half of 2025, an increase from $164.0 million and $119.1 million in the same period of 2024, respectively [8][24] - The company repurchased $251.3 million worth of shares in the first half of 2025 and expects to spend approximately $400 million on share repurchases for the full year [9][3] - As of June 30, 2025, cash and marketable securities totaled $177.9 million, with total debt at $303.4 million, resulting in a leverage ratio of 14.1% [7][19] Outlook - The company raised its full-year 2025 sales outlook, projecting consolidated sales growth between 1% and 3%, with diluted EPS guidance set between $3.70 and $3.90 [11][25] - The outlook reflects confidence in managing tariffs and expected improvements in market share performance due to production initiatives [11][12]

Core Viewpoint - A. O. Smith Corporation (AOS) is expected to report second-quarter 2025 results on July 24, with mixed performance indicators suggesting potential challenges and opportunities ahead [1][9]. Revenue and Earnings Estimates - The Zacks Consensus Estimate for A. O. Smith's revenues is $987.3 million, reflecting a 3.6% decline from the previous year [2]. - The consensus estimate for adjusted earnings is 97 cents per share, indicating an 8.4% decline year-over-year [2]. Segment Performance - The North-American segment is anticipated to benefit from strong demand for commercial boilers and water treatment products, although a decline of 3.4% year-over-year to $764 million is expected due to softness in the residential and commercial water heater industry [3]. - The Rest of World segment is projected to generate revenues of $234 million, down 4.5% from the prior year, primarily due to challenges in the Chinese real estate market affecting residential water treatment and gas water heating products [4]. Cost and Acquisition Impact - A. O. Smith has faced high costs and expenses, with labor shortages and increased material costs negatively impacting performance, despite some moderation in supply-chain constraints [5]. - Recent acquisitions, such as the Pureit business from Unilever and Impact Water Products, are expected to positively influence the company's top line and enhance its position in the water treatment industry [6][7]. Earnings Expectations - A. O. Smith has an Earnings ESP of +4.48%, with the Most Accurate Estimate at $1.01 per share, suggesting a potential earnings beat despite the projected decline in EPS [8][9].

Core Viewpoint - A.O. Smith (AOS) is expected to report a quarterly earnings per share (EPS) of $0.97, reflecting an 8.5% year-over-year decline, with revenues projected at $987.3 million, a decrease of 3.6% compared to the previous year [1]. Earnings Estimates - Over the past 30 days, the consensus EPS estimate has been revised downward by 0.6%, indicating a reassessment by analysts [2]. - Revisions to earnings estimates are crucial for predicting investor actions, as empirical research shows a strong correlation between earnings estimate trends and short-term stock price performance [3]. Revenue Estimates - The consensus estimate for 'Geographic Revenue- North America' is $763.85 million, suggesting a year-over-year change of -3.4% [5]. - The estimated 'Geographic Revenue- Rest of World' is $234.39 million, indicating a decline of 4.3% from the prior-year quarter [5]. Segment Operating Earnings - Analysts estimate 'Segment Operating Earnings (NON-GAAP)- North America' to be $180.26 million, down from $198.40 million reported in the same quarter last year [6]. - The estimate for 'Segment Operating Earnings (NON-GAAP)- Rest of World' is $22.62 million, compared to $25.90 million in the previous year [6]. - The average prediction for 'Segment Operating Earnings (GAAP)- North America' is $174.91 million, also down from $198.40 million reported last year [7]. - The consensus for 'Segment Operating Earnings (GAAP)- Rest of World' is $23.46 million, compared to $25.90 million in the same quarter of the previous year [7]. Stock Performance - Over the past month, A.O. Smith shares have returned +12.1%, outperforming the Zacks S&P 500 composite's +5.4% change [7]. - A.O. Smith currently holds a Zacks Rank 3 (Hold), suggesting its performance may align with the overall market in the near future [7].

Core Viewpoint - A.O. Smith is anticipated to report a year-over-year decline in earnings and revenues for the quarter ended June 2025, with earnings expected at $0.97 per share, reflecting an 8.5% decrease, and revenues projected at $987.3 million, down 3.6% from the previous year [1][3]. Earnings Expectations - The upcoming earnings report is scheduled for July 24, and the stock may rise if the actual results exceed expectations, while a miss could lead to a decline [2]. - The consensus EPS estimate has been revised down by 0.56% over the last 30 days, indicating a reassessment by analysts [4]. Earnings Surprise Prediction - A.O. Smith has a positive Earnings ESP of +4.48%, suggesting analysts have recently become more optimistic about the company's earnings prospects [12]. - The stock currently holds a Zacks Rank of 3, indicating a neutral outlook, but the combination of a positive Earnings ESP and this rank suggests a likelihood of beating the consensus EPS estimate [12]. Historical Performance - In the last reported quarter, A.O. Smith had an earnings surprise of +5.56%, reporting earnings of $0.95 per share against an expectation of $0.90 [13]. - Over the past four quarters, the company has only beaten consensus EPS estimates once [14]. Conclusion - A.O. Smith is viewed as a potential earnings-beat candidate, but investors should consider other factors influencing stock performance beyond just earnings results [15][17].

Core Viewpoint - A. O. Smith Corporation is set to release its second quarter 2025 financial results on July 24, 2025, before the market opens, followed by an investor conference call at 10:00 a.m. EDT [1] Company Overview - A. O. Smith Corporation is headquartered in Milwaukee, Wisconsin, and is recognized as a global leader in innovative technology and energy-efficient solutions for products marketed worldwide [2] - The company is a leading manufacturer of residential and commercial water heating equipment, boilers, and water treatment products, and is listed on the New York Stock Exchange under the ticker symbol AOS [2]

Core Viewpoint - A. O. Smith Corporation announces the retirement of Bob Heideman after 29 years, with Ming Cheng set to take over as senior vice president and chief technology officer starting July 7, 2025 [1][2]. Group 1: Leadership Transition - Ming Cheng has a 25-year tenure at 3M, where he led global teams in technology and product development [2]. - Cheng's previous roles at 3M include vice president of research and development in Greater China and various leadership positions in research and development [2][4]. - Bob Heideman will remain with the company until September 1 to facilitate a smooth transition [1]. Group 2: Background and Qualifications - Cheng holds a Bachelor of Science in chemistry from Peking University, a Doctoral Degree in polymer chemistry from Cornell University, and an MBA from the University of Minnesota [3]. - Heideman joined A. O. Smith in 1994 as a project engineer and has held various leadership roles, including senior vice president of engineering and technology [4][5]. Group 3: Company Overview - A. O. Smith Corporation is a global leader in water heating and treatment, known for innovative technology and energy-efficient solutions [5]. - The company is listed on the New York Stock Exchange (NYSE: AOS) and manufactures residential and commercial water heating equipment and boilers [5].

Core Insights - A. O. Smith Corporation has been recognized by USA Today and Statista as one of America's Climate Leaders for the second consecutive time, highlighting its commitment to reducing carbon intensity [1][2] - The company achieved a 12% reduction in Scope 1 and Scope 2 greenhouse gas emissions intensity from 2021 to 2023, surpassing the minimum requirement of a 3% year-over-year reduction to qualify for the list [2][6] - A. O. Smith's sustainability efforts are deeply integrated into its corporate values, focusing on innovation and corporate citizenship [3] Sustainability Efforts - The company has made significant strides in sustainability over the past two years, including the announcement of its first public enterprise-wide water goal, which emphasizes administrative controls, process optimization, and water recycling technologies [7] - Continuous innovation in water heating and treatment technologies aims to position A. O. Smith as an industry leader in energy and water efficiency, consistently exceeding regulatory standards [7] - A. O. Smith is committed to providing empirical information to policymakers to facilitate positive changes in environmental practices [7] Company Overview - A. O. Smith Corporation, headquartered in Milwaukee, Wisconsin, is a global leader in innovative technology and energy-efficient solutions for water heating and treatment products [5] - The company is listed on the New York Stock Exchange (NYSE: AOS) and is recognized as one of the leading manufacturers of residential and commercial water heating equipment and boilers [5]

Core Insights - Stepan Company has announced a 25% increase in its production capacity for Alpha Olefin Sulfonates (AOS) through strategic capital investments and process improvements [1][2][4] - The company operates the broadest network of AOS production sites in North America, enhancing operational efficiency and reliability for customers [2][4] - AOS is a versatile surfactant used in various applications, including detergents and personal care products, and is increasingly preferred due to its environmental benefits and suitability for sulfate-free formulations [3][4] Company Overview - Stepan Company is a major manufacturer of specialty and intermediate chemicals, particularly known for its surfactants used in cleaning, agricultural, and oilfield solutions [5][6] - The company is headquartered in Northbrook, Illinois, and has a global production network across North and South America, Europe, and Asia [6]

Core Insights - A.O. Smith shares have declined approximately 5.4% since the last earnings report, underperforming the S&P 500 [1] - There is uncertainty regarding whether this negative trend will continue or if a breakout is imminent [1] Estimates Movement - Estimates for A.O. Smith have trended downward over the past month [2] VGM Scores - A.O. Smith has an average Growth Score of C, a Momentum Score of B, and a Value Score of B, placing it in the top 40% for the value investment strategy [3] Outlook - The downward trend in estimates suggests a negative shift, with A.O. Smith holding a Zacks Rank 3 (Hold), indicating expectations for an in-line return in the coming months [4]