Analysts Forecast A. O. Smith’s Q1 2025 Earnings Amidst Mixed Performance

With a market capitalization of $9 billion, A. O. Smith Corporation (AOS) stands as a global leader in the production and distribution of residential and commercial water heating and treatment solutions. The company, based in Milwaukee, Wisconsin, operates segments in North America and the Rest of the World, offering brands including A. O. Smith, State, Lochinvar, and Aquasana via wholesale, retail, and e-commerce channels. Investors are anticipating the release of its fiscal Q1 2025 earnings results before market opening on Tuesday, April 29.

Projected Earnings and Past Performance

Analysts expect A. O. Smith to report an adjusted EPS of $0.90, marking a 10% decline compared to $1 in the same quarter last year. The company has had a mixed performance, exceeding or meeting Wall Street’s earnings expectations in two of the last four quarters while missing estimates twice. Notably, in Q4 2024, AOS fell short of the consensus adjusted EPS expectations by 4.5%.

In fiscal 2025, analysts forecast an adjusted EPS of $3.76, slightly up from $3.73 in fiscal 2024. Furthermore, they project that adjusted EPS will grow to $4.20 in fiscal 2026, reflecting an 11.7% year-over-year increase.

Share Price Performance Relative to the Market

A. O. Smith’s shares have fallen by 26.5% over the past year, notably underperforming the broader S&P 500 Index ($SPX), which has risen 2.1%, and the Industrial Select Sector SPDR Fund’s (XLI) minimal decline during the same timeframe.

On January 30, A.O. Smith’s shares decreased by 2.8% following the announcement of their Q4 2024 adjusted EPS of $0.85 and revenue of $912.4 million, both of which were below estimates. The company reported a year-over-year adjusted EPS drop of 12.4% and a revenue decline of 7.7%. Sales in North America also fell by 7.7%, largely due to reduced water heater volumes, while revenue in the Rest of the World segment decreased by 4%, primarily driven by sluggish demand in China. Additionally, management’s guidance for 2025, projecting EPS between $3.60 and $3.90, alongside anticipated ongoing sales declines in China, has raised investor concerns.

Analyst Ratings and Market Sentiment

The consensus among analysts regarding A. O. Smith’s stock is cautious, reflected in an overall “Hold” rating. Among 11 analysts monitoring the stock, three suggest a “Strong Buy,” seven recommend a “Hold,” and one advises a “Strong Sell.” This sentiment is slightly more optimistic than three months prior, when only one analyst had a “Strong Buy” rating.

Currently, AOS is trading below the average analyst price target of $74.56.

On the date of publication,

Sohini Mondal

did not hold (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article are solely for informational purposes. For more information, please view the Barchart Disclosure Policy

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