We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
A. O. Smith (AOS) Q4 Earnings & Revenues Beat Estimates
Read MoreHide Full Article
A. O. Smith Corporation (AOS - Free Report) has reported better-than-expected fourth-quarter 2021 results, wherein adjusted earnings of 87 cents per share beat the Zacks Consensus Estimate of 77 cents. The bottom line also increased 17.6% from the year-ago figure of 74 cents.
In 2021, the company’s adjusted earnings came in at $3.02, up 42% year over year.
Top-Line Details
The company’s fourth-quarter net sales increased 19.3% year over year to $995.5 million. The increase was driven by higher sales in North America and China, supported by its pricing actions. The top line surpassed the Zacks Consensus Estimate of $966 million.
In 2021, the company’s net sales were $3,538.9 million, up 22% on a year-over-year basis.
A. O. Smith’s quarterly sales in North America (comprising the United States and Canada water heaters and boilers) moved up 27% year over year to $714.8 million. The segment’s results were primarily driven by the company’s pricing actions.
Segmental operating earnings were up 21% to $166.9 million on a year-over-year basis. The jump was on account of inflation-related price increases, partially offset by a rise in material and logistics costs.
Quarterly sales in the Rest of the World (including China, India and Europe) grew 3% year over year to $287.9 million. The increase was primarily backed by a positive mix in water treatment and water heater products in China.
The segment’s operating earnings were $30.5 million, reflecting a marginal decline year over year. Lower sales volume, partially offset by favorable product mix, affected the segment’s income.
A. O. Smith Corporation Price, Consensus and EPS Surprise
In the quarter, A.O. Smith’s cost of sales was $634.9 million, up 24.4% on a year-over-year basis. Selling, general & administrative expenses were $184.2 million, up 7.6%.
Gross profit increased 11.3% year over year to $360.6 million with a margin of 36.2%, down 260 basis points. Interest expenses increased 40% to $1.4 million.
Liquidity & Cash Flow
On Dec 31, 2021, A.O. Smith’s cash and cash equivalents totaled $443.3 million compared with $486.1 million in the previous quarter.
At the end of the reported quarter, long-term debt was $189.9 million, up 90.7% from $99.6 million sequentially.
In 2021, cash provided by the operating activities totaled $641.1 million compared with $562.1 million a year ago.
Share Repurchases
In 2021, the company repurchased shares worth $366.5 million compared with $56.7 million in 2020. It paid dividends worth $170.1 million compared with $158.7 million a year ago.
Guidance
The company provided revenue and earnings guidance for 2022. It anticipates revenues to increase 16-18% from the previous year.
It currently expects adjusted earnings of $3.35-$3.55.
Zacks Rank & Stocks to Consider
The company currently carries a Zacks Rank #3 (Hold).
Some better-ranked companies in the industry are discussed below.
AZZ’s earnings estimates increased 2.3% for fiscal 2022 (ending February 2022) and 3.7% for fiscal 2023 (ending February 2023) in the past 30 days. Its shares have lost 9.1% in the past three months.
Franklin Electric Co., Inc. (FELE - Free Report) presently carries a Zacks Rank #2. Its earnings surprise in the last four quarters was 16.27%, on average.
In the past 30 days, Franklin Electric’s earnings estimates have been stable for 2021 (results are awaited) and increased 0.6% for 2022. FELE’s shares have gained 0.7% in the past three months.
Zurn Water Solutions Corporation (ZWS - Free Report) presently carries a Zacks Rank #2. Its earnings surprise in the last four quarters was 33.09%, on average.
Zurn’s earnings estimates have been stable for 2021 (results are awaited) and decreased 0.9% for 2022 in the past 30 days. ZWS’ shares have lost 16.2% in the past three months.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
A. O. Smith (AOS) Q4 Earnings & Revenues Beat Estimates
A. O. Smith Corporation (AOS - Free Report) has reported better-than-expected fourth-quarter 2021 results, wherein adjusted earnings of 87 cents per share beat the Zacks Consensus Estimate of 77 cents. The bottom line also increased 17.6% from the year-ago figure of 74 cents.
In 2021, the company’s adjusted earnings came in at $3.02, up 42% year over year.
Top-Line Details
The company’s fourth-quarter net sales increased 19.3% year over year to $995.5 million. The increase was driven by higher sales in North America and China, supported by its pricing actions. The top line surpassed the Zacks Consensus Estimate of $966 million.
In 2021, the company’s net sales were $3,538.9 million, up 22% on a year-over-year basis.
A. O. Smith’s quarterly sales in North America (comprising the United States and Canada water heaters and boilers) moved up 27% year over year to $714.8 million. The segment’s results were primarily driven by the company’s pricing actions.
Segmental operating earnings were up 21% to $166.9 million on a year-over-year basis. The jump was on account of inflation-related price increases, partially offset by a rise in material and logistics costs.
Quarterly sales in the Rest of the World (including China, India and Europe) grew 3% year over year to $287.9 million. The increase was primarily backed by a positive mix in water treatment and water heater products in China.
The segment’s operating earnings were $30.5 million, reflecting a marginal decline year over year. Lower sales volume, partially offset by favorable product mix, affected the segment’s income.
A. O. Smith Corporation Price, Consensus and EPS Surprise
A. O. Smith Corporation price-consensus-eps-surprise-chart | A. O. Smith Corporation Quote
Margin Details
In the quarter, A.O. Smith’s cost of sales was $634.9 million, up 24.4% on a year-over-year basis. Selling, general & administrative expenses were $184.2 million, up 7.6%.
Gross profit increased 11.3% year over year to $360.6 million with a margin of 36.2%, down 260 basis points. Interest expenses increased 40% to $1.4 million.
Liquidity & Cash Flow
On Dec 31, 2021, A.O. Smith’s cash and cash equivalents totaled $443.3 million compared with $486.1 million in the previous quarter.
At the end of the reported quarter, long-term debt was $189.9 million, up 90.7% from $99.6 million sequentially.
In 2021, cash provided by the operating activities totaled $641.1 million compared with $562.1 million a year ago.
Share Repurchases
In 2021, the company repurchased shares worth $366.5 million compared with $56.7 million in 2020. It paid dividends worth $170.1 million compared with $158.7 million a year ago.
Guidance
The company provided revenue and earnings guidance for 2022. It anticipates revenues to increase 16-18% from the previous year.
It currently expects adjusted earnings of $3.35-$3.55.
Zacks Rank & Stocks to Consider
The company currently carries a Zacks Rank #3 (Hold).
Some better-ranked companies in the industry are discussed below.
AZZ Inc. (AZZ - Free Report) presently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Its earnings surprise for the last four quarters was 16.90%, on average.
AZZ’s earnings estimates increased 2.3% for fiscal 2022 (ending February 2022) and 3.7% for fiscal 2023 (ending February 2023) in the past 30 days. Its shares have lost 9.1% in the past three months.
Franklin Electric Co., Inc. (FELE - Free Report) presently carries a Zacks Rank #2. Its earnings surprise in the last four quarters was 16.27%, on average.
In the past 30 days, Franklin Electric’s earnings estimates have been stable for 2021 (results are awaited) and increased 0.6% for 2022. FELE’s shares have gained 0.7% in the past three months.
Zurn Water Solutions Corporation (ZWS - Free Report) presently carries a Zacks Rank #2. Its earnings surprise in the last four quarters was 33.09%, on average.
Zurn’s earnings estimates have been stable for 2021 (results are awaited) and decreased 0.9% for 2022 in the past 30 days. ZWS’ shares have lost 16.2% in the past three months.