A.O. Smith Corp. (AOS) Upgraded to Buy at Zacks Investment Research
A.O. Smith Corp. (NYSE:AOS) was upgraded by Zacks Investment Research from a “hold” rating to a “buy” rating in a report issued on Monday. The brokerage presently has a $55.00 price target on the stock. Zacks Investment Research’s price target suggests a potential upside of 11.79% from the stock’s previous close.
According to Zacks, “A.O. Smith has an excellent earnings surprise history, beating estimates each time in the trailing four quarters. The company’s dominant foothold in the North American water heater market, along with thriving prospects in residential and commercial boiler markets are expected to boost growth. Sales of residential and commercial boilers are largely driven by innovation by Lochinvar. Going forward in 2016, the company projects growth rate of 8% for total Lochinvar-branded products. Also, the recent acquisition of residential water treatment firm – Aquasana – is expected to fortify the geographic footprint. The company expects its China operations to maintain momentum and experience about 15% growth rate in local currency in 2016. However, foreign currency fluctuations, escalating SG&A & other corporate expenses and higher steel prices are likely to act as significant headwinds in the forthcoming quarters.”
AOS has been the subject of several other reports. BMO Capital Markets set a $53.00 target price on shares of A.O. Smith Corp. and gave the stock a “buy” rating in a research report on Monday, August 8th. KeyCorp reiterated a “buy” rating and issued a $107.00 target price on shares of A.O. Smith Corp. in a research report on Thursday, October 6th. Finally, Jefferies Group cut their target price on shares of A.O. Smith Corp. from $55.50 to $43.00 and set a “buy” rating for the company in a research report on Friday, September 23rd. Three analysts have rated the stock with a hold rating and nine have given a buy rating to the stock. A.O. Smith Corp. currently has a consensus rating of “Buy” and an average price target of $54.14.
Shares of A.O. Smith Corp. (NYSE:AOS) traded down 0.98% on Monday, hitting $48.72. The stock had a trading volume of 312,065 shares. A.O. Smith Corp. has a 1-year low of $30.15 and a 1-year high of $51.49. The company has a market capitalization of $8.47 billion, a PE ratio of 26.61 and a beta of 1.40. The firm has a 50-day moving average of $47.43 and a 200 day moving average of $45.58.
A.O. Smith Corp. (NYSE:AOS) last released its quarterly earnings results on Wednesday, October 26th. The company reported $0.47 EPS for the quarter, beating analysts’ consensus estimates of $0.45 by $0.02. The firm earned $683.90 million during the quarter, compared to analyst estimates of $577.20 million. A.O. Smith Corp. had a net margin of 12.32% and a return on equity of 21.84%. The business’s revenue for the quarter was up 9.4% on a year-over-year basis. During the same period in the previous year, the business earned $0.41 EPS. On average, equities analysts anticipate that A.O. Smith Corp. will post $1.83 earnings per share for the current fiscal year.
The company also recently disclosed a quarterly dividend, which was paid on Tuesday, November 15th. Stockholders of record on Monday, October 31st were paid a dividend of $0.12 per share. This represents a $0.48 annualized dividend and a dividend yield of 0.98%. The ex-dividend date was Thursday, October 27th. A.O. Smith Corp.’s dividend payout ratio (DPR) is 26.30%.
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In other A.O. Smith Corp. news, VP James F. Stern sold 20,000 shares of the company’s stock in a transaction dated Monday, November 14th. The shares were sold at an average price of $47.69, for a total value of $953,800.00. Following the sale, the vice president now owns 85,267 shares in the company, valued at $4,066,383.23. The sale was disclosed in a filing with the SEC, which is available through the SEC website. Also, SVP Charles T. Lauber sold 2,473 shares of the company’s stock in a transaction dated Thursday, November 10th. The stock was sold at an average price of $48.12, for a total transaction of $119,000.76. The disclosure for this sale can be found here. Insiders own 1.76% of the company’s stock.
A number of large investors have recently made changes to their positions in the company. OLD Mutual Customised Solutions Proprietary Ltd. acquired a new stake in shares of A.O. Smith Corp. during the second quarter worth $106,000. Nordea Investment Management AB purchased a new stake in A.O. Smith Corp. during the second quarter worth approximately $150,000. Daiwa Securities Group Inc. purchased a new stake in A.O. Smith Corp. during the second quarter worth approximately $150,000. Mn Services Vermogensbeheer B.V. purchased a new stake in A.O. Smith Corp. during the second quarter worth approximately $150,000. Finally, Timber Hill LLC purchased a new stake in A.O. Smith Corp. during the second quarter worth approximately $201,000. Institutional investors and hedge funds own 37.60% of the company’s stock.
A.O. Smith Corp. Company Profile
A. O. Smith Corporation operates its business through two segments, which include North America and Rest of World. The Company’s Rest of World segment primarily comprises China, Europe and India. The Rest of World segment supplies water heaters to the residential market in China with a range of product offering, including electric, gas, gas tankless, heat pump and solar units, as well as combi boilers.
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