A.O. Smith (AOS) came out with quarterly earnings of $0.82 per share, in line with the Zacks Consensus Estimate. This compares to earnings of $0.90 per share a year ago. These figures are adjusted for non-recurring items.A quarter ago, it was expected that this maker of water heaters and boilers would post earnings of $1.07 per share when it actually produced earnings of $1.06, delivering a surprise of -0.93%.Over the last four quarters, the company has surpassed consensus EPS estimates two times.A.O. Smith ...

News Release Media Relations: Curt Selby 414-359-4100 curt.selby@aosmith.com | --- | |------------------------------| | | | | | Investor Relations: | | Helen Gurholt 414-359-4157 | FOR IMMEDIATE RELEASE October 11, 2024 A. O. Smith Announces Preliminary Third Quarter Results and Provides Revised 2024 Full Year Guidance Summary (Comparisons are year-over-year ("YoY"), unless otherwise noted) • Preliminary third quarter sales of $903 million, a decrease of 4%, due to lower sales in China and North America wat ...

Financial Performance - Company reported third quarter 2024 net sales of $902.6 million, a decrease of 4% year-over-year from $937.5 million [1] - Net earnings for the quarter were $120.1 million, down 11% from $135.4 million in the same period last year [1] - Diluted earnings per share (EPS) decreased by 9% to $0.82 compared to $0.90 in Q3 2023 [1] Segment Performance - North America sales were $703.3 million, a decline of 1% year-over-year, primarily due to lower residential and commercial water heater volumes [1][2] - Rest of World segment sales decreased by 10% to $210.3 million, with a 17% decline in China due to weak consumer demand, while India saw a 12% increase [3] - Segment earnings in North America were $162.5 million with a margin of 23.1%, down from $170.0 million and 23.9% in 2023 [2] Cash Flow and Capital Allocation - Cash provided by operations was $359.9 million, with free cash flow at $282.5 million for the first nine months of 2024, both showing a decrease year-over-year [4][19] - Company repurchased 2.9 million shares for $237.1 million in the first nine months of 2024, with an expected total of approximately $300 million for the year [4] - The company has cash and marketable securities totaling $255.6 million and total debt of $119.7 million as of September 30, 2024 [3] Dividend and Outlook - Company announced a 6% increase in its dividend, marking 32 consecutive years of dividend increases [1][5] - The revised EPS outlook for 2024 is between $3.70 and $3.85, reflecting a cautious stance on consumer demand in China and North America [5][20]

Core Viewpoint - A. O. Smith Corporation (AOS) is expected to report a decline in both revenue and earnings for the third quarter of 2024, with significant challenges in its North America and Rest of the World segments [2][3][4]. Financial Performance - The Zacks Consensus Estimate for revenues is $901.1 million, reflecting a 4% decline year-over-year [2] - The consensus estimate for earnings is 86 cents per share, indicating an 8.5% decrease over the past 60 days and a 4.4% decline from the previous year's quarter [2] - The company's bottom line missed the Zacks Consensus Estimate by one cent in the last quarter, with an average earnings surprise of 3.8% over the trailing four quarters [2] Segment Performance - The North America segment is projected to report revenues of $703 million, down 1% year-over-year, primarily due to reduced orders for residential and commercial water heater products [3] - The Rest of the World segment is expected to show revenues of $210 million, a 10% decline year-over-year, impacted by decreasing demand for residential water treatment and lower volumes of water heating products in China [3] Cost and Expenses - The company is facing rising costs, with the cost of sales anticipated to increase by 1.5% to $589.8 million and SG&A expenses expected to rise by 3.6% to $181.1 million compared to the previous year [4] - Foreign currency headwinds are likely to negatively affect profitability due to the company's significant international operations [4] Strategic Acquisitions - Recent acquisitions, such as Impact Water Products in March 2024 and Atlantic Filter in June 2022, are expected to positively influence AOS's top line by expanding its water treatment footprint in North America [5] Earnings Prediction - The current model does not predict an earnings beat for AOS, as the Earnings ESP is 0.00% with both the Most Accurate Estimate and Zacks Consensus Estimate at 82 cents [6] - AOS holds a Zacks Rank of 5 (Strong Sell), indicating a challenging outlook for the upcoming earnings report [6]

Core Viewpoint - A.O. Smith (AOS) is expected to report a decline in quarterly earnings and revenues, with significant downward revisions in earnings projections by analysts [1][2]. Financial Performance - The anticipated quarterly earnings per share (EPS) for A.O. Smith is $0.82, reflecting an 8.9% decrease year-over-year [1]. - Analysts forecast revenues of $901.55 million, indicating a 3.8% decline compared to the previous year [1]. - The consensus EPS estimate has been revised down by 12.7% in the last 30 days, highlighting a reassessment by covering analysts [1]. Geographic Revenue Insights - North America revenue is projected to be $708.50 million, showing a slight decrease of 0.2% from the year-ago quarter [2]. - Revenue from the Rest of the World is expected to be $215.40 million, reflecting a year-over-year decline of 7.7% [2]. Segment Operating Earnings - Segment Operating Earnings (NON-GAAP) for North America is estimated at $161.92 million, down from $170 million in the same quarter last year [2]. - Segment Operating Earnings (NON-GAAP) for the Rest of the World is forecasted to be $18.38 million, compared to $23.20 million reported in the previous year [3]. - Segment Operating Earnings (GAAP) for North America is expected to reach $170.42 million, consistent with the year-ago figure [3]. - Segment Operating Earnings (GAAP) for the Rest of the World is projected at $16.90 million, down from $23.20 million in the same quarter last year [3]. Stock Performance - A.O. Smith shares have experienced a return of -3.2% over the past month, contrasting with a +3.8% change in the Zacks S&P 500 composite [3]. - The company holds a Zacks Rank 5 (Strong Sell), indicating expectations of underperformance relative to the overall market in the near future [3].

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Here are three stocks added to the Zacks Rank #24 (Strong Sell) List today:A. O. Smith Corporation (AOS) is a residential and commercial gas and electric water utility products company. The Zacks Consensus Estimate for its current year earnings has been 5.2% downward over the last 60 days.Deere & Company (DE) is a distributor of agricultural, forestry and construction equipment. The Zacks Consensus Estimate for its current year earnings has been revised 1.2% downward over the last 60 days.The Manitowoc Comp ...

Summary(Comparisons are year-over-year ("YoY"), unless otherwise noted)Preliminary third quarter sales of $903 million, a decrease of 4%, due to lower sales in China and North America water heatingPreliminary third quarter earnings per share ("EPS") of $0.82, a decrease of 9%Preliminary cash provided by operations of $360 million and preliminary free cash flow of $283 million in the first nine months of 2024Lowered full year EPS guidance to be between $3.70 and $3.85 compared to prior guidance of $3.95 to $ ...

A. O. Smith (NYSE: AOS ), a global producer of residential and commercial water heaters and boilers, hasn’t quite been able to generate ample alpha for its stakeholders this year. On a YTD basis, AOS has only notched up returnsAnalyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for i ...

In a shareholder-friendly move, A. O. Smith Corporation (AOS) recently announced a hike in its dividend payout. The company increased its quarterly dividend by 6% to 34 cents per share (annually: $1.36). The new dividend will be paid out on Nov. 15, 2024, to shareholders of record as of Oct. 31.The move underscores AOS’ sound financial health as it utilizes free cash flow to enhance its shareholders’ returns. The five-year compound annual growth rate of its’ dividend is about 8%. The company has increased i ...