Watts Water Technologies, Inc. (WTS) AI Stock Analysis

Watts Water Technologies, Inc. designs, manufactures, and distributes products and systems that control and conserve the flow of fluids and energy within buildings across global markets. The company serves the Americas, Europe, Asia-Pacific, the Middle East, and Africa across residential and commercial sectors. Its product lineup includes flow control products such as backflow preventers, water pressure regulators, temperature and pressure relief valves, and thermostatic mixing valves. It also supplies HVAC products, including boilers, water heaters, hydronic pump groups, and radiant heating systems, alongside flexible stainless steel gas connectors, drainage systems, and water reuse solutions.

Watts Water Technologies grew annual revenue from $1.81B in FY2021 to $2.44B in FY2025, representing a 5-year revenue CAGR of 10.1%. Operating margin widened from 13.2% in FY2021 to 19.3% in FY2025, while gross margin expanded from 42.4% to 49.5%. Annual net income rose from $165.7M to $340.8M over the same period, bringing FY2025 diluted EPS to $10.58. For the trailing twelve months ended June 30, 2026, revenue totaled $2.68B with a profit margin of 14.3% and EPS of $11.45. In the latest quarter ended June 30, 2026, quarterly revenue grew 18.6% year-over-year, while quarterly earnings grew 17.3%.

As of June 30, 2026, Watts Water Technologies held $347.9M in cash and short-term investments against total debt of $108.0M, resulting in net cash of $239.9M. The company's current ratio stood at 2.66, with a debt-to-equity ratio of 0.05 and shareholders' equity of $2.19B. In FY2025, operating cash flow reached $402.0M, supporting capital expenditures of $45.7M and free cash flow of $356.3M. The company allocated capital to $66.9M in dividends and $16.0M in share buybacks during FY2025, with share count decreasing 1.2% over 5 years.

Watts Water Technologies trades at a trailing P/E of 31.2x and a forward P/E of 25.3x, compared to the median of its US-listed Industrials peers of 24.8x and 17.2x, respectively. Its enterprise value stands at $11.65B, representing an EV-to-EBITDA multiple of 20.0x, above the peer median of 13.9x. The stock trades at a price-to-sales ratio of 4.4x versus the peer median of 1.5x. Over the past year, the stock returned 30.1% against 16.8% for the S&P 500, and its 5-year return reached 109.4% compared to 83.0% for the index.

Watts Water Technologies pays an annual forward dividend of $2.30 per share, yielding 0.64% with a payout ratio of 19.5%. The company has paid quarterly dividends for 41 consecutive years, with an annualized 5-year dividend growth rate of 16.7%. Its last ex-dividend date was September 1, 2026.

Wall Street analysts coverage consists of 2 Strong Buy, 1 Buy, and 7 Hold ratings, with no Sell or Strong Sell ratings. The mean price target is $404.00, representing 13.3% upside compared to the last close of $356.70. For the fiscal year ending December 31, 2026, consensus estimates project EPS of $12.70, reflecting 20.1% growth, on revenue of $2.83B. Watts Water Technologies has beaten EPS estimates in each of the last 4 quarters, with its next earnings report scheduled for November 4, 2026.

This page is an AI-written research summary of Watts Water Technologies, Inc. (WTS). The text was generated on October 30, 2026 from Quotelinks data as of October 16, 2026 (company profile, annual results, latest balance sheet, valuation, price performance and analyst estimates). An automatic check rejects any draft that contains a figure not found in that data. It is not investment advice; verify figures on the linked tabs before making decisions.

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