AOS Intrinsic Value – A. O. SMITH Reports Second Quarter FY2023 Earnings Results for June 30 2023
July 29, 2023
🌥️Earnings Overview
On July 27 2023, A. O. SMITH ($NYSE:AOS) revealed its earnings report for the second quarter of FY2023, which ended on June 30 2023. The total revenue was USD 960.8 million, a decrease of 0.5% year-on-year. However, the company’s net income was USD 157.0 million, a 24.4% increase compared to the same period the previous year.
Stock Price
The stock opened at $74.2 and eventually closed at $73.7, down by 1.9% from the prior closing price of $75.1. This slight decrease in stock price indicates that investors are awaiting better results to come from the company as they enter into the new fiscal year. This increase was largely driven by growth in their North American and International markets.
Despite a slight dip in stock price, the reported sales and profit increases demonstrate that the company is continuing to make strides in their global market. Investors should remain confident in the long-term prospects of A. O. SMITH as they move into the new fiscal year. Live Quote…
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for AOS. More…
| Total Revenues | Net Income | Net Margin |
| 3.74k | 273.6 | 7.7% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for AOS. More…
| Operations | Investing | Financing |
| 597.2 | 1 | -542.8 |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for AOS. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 3.25k | 1.36k | 11.9 |
Key Ratios Snapshot
Some of the financial key ratios for AOS are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 10.4% | 23.3% | 7.9% |
| FCF Margin | ROE | ROA |
| 14.3% | 10.3% | 5.7% |
Analysis – AOS Intrinsic Value
At GoodWhale, we’ve conducted an analysis of A. O. SMITH’s wellbeing. According to our proprietary Valuation Line, the fair value of A. O. SMITH share is around $52.7. However, the current market price is $73.7, which is a 40.0% overvaluation of the stock. This suggests that the current market sentiment for A. O. SMITH’s stock is potentially overoptimistic. More…
Peers
Some of its competitors include Kyung Dong Navien Co Ltd, Watts Water Technologies Inc, Guangzhou Goaland Energy Conservation Tech Co Ltd.
– Kyung Dong Navien Co Ltd ($KOSE:009450)
Kyung Dong Navien Co Ltd is a South Korean company that manufactures and sells combi boilers, heat pumps, and other heating and hot water products. The company has a market cap of 489.23B as of 2022 and a ROE of 32.93%. Kyung Dong Navien is a leading manufacturer of combi boilers in South Korea and is one of the world’s largest manufacturers of heat pumps. The company’s products are used in residential, commercial, and industrial applications.
– Watts Water Technologies Inc ($NYSE:WTS)
Watts Water Technologies, Inc. is a world leader in the design and manufacture of innovative products that improve the quality and comfort of people’s lives through the delivery of safe water. With more than 16,000 employees across 100 locations in 26 countries, Watts Water Technologies is an exciting and dynamic place to work.
Watts Water Technologies has a market cap of $4.2 billion as of 2022 and a return on equity of 15.67%. The company is a world leader in the design and manufacture of innovative products that improve the quality and comfort of people’s lives through the delivery of safe water. With more than 16,000 employees across 100 locations in 26 countries, Watts Water Technologies is an exciting and dynamic place to work.
– Guangzhou Goaland Energy Conservation Tech Co Ltd ($SZSE:300499)
Guangzhou Goaland Energy Conservation Tech Co Ltd is a publicly traded company with a market cap of 3.3 billion as of 2022. The company has a return on equity of 8.08%. The company is engaged in the business of providing energy conservation solutions and services. The company has a strong presence in the Chinese market and is expanding its operations globally. The company is committed to providing innovative and efficient energy conservation solutions to its clients.
Summary
A. O. SMITH reported second quarter earnings for FY2023 at USD 960.8 million in revenue, a 0.5% decrease from the prior year.
However, net income was up 24.4%, sitting at USD 157.0 million. This is a positive sign for investors, signalling that the company is continuing to generate healthy profits despite the challenges of the current market landscape. Moreover, the revenue decrease implies that the company is able to remain competitive and maintain its market share in the face of changing industry trends. Overall, A. O. SMITH appears to be a solid investment option for those looking to diversify their portfolios.
