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A. O. Smith AOS

A. O. Smith scores good on business quality (6.7 of 10). Here is why, in plain words, and what our sealed record shows.

Last price$56.38Oct 9, 2026
Business qualityGood
Next earningsOct 29, 2026
Insiders, 90 daysQuiet

Why it matters

  1. What A. O. Smith does

    A.O. Smith manufactures residential and commercial water heaters and boilers, selling primarily through wholesale and retail channels to plumbing contractors and homeowners. The company relies on replacement demand and plumbing brand loyalty to sustain its core product volume across North America and Asia.

  2. What it does best

    A.O. Smith dominates residential water heater distribution through contractor loyalty and scale, posting a high free cash flow margin in the top quartile of its sector at 89th percentile. This distribution network creates deep switching barriers for plumbing installers.

  3. The main risk

    Topline stagnation threatens the business as revenue growth sits in the bottom quartile of its sector at the 22nd percentile. With revenue flat near $3.8 billion, any volume loss directly strains the profit base.

Quality, check by check

Scored against its own industry, from company filings.

ProfitabilityStrong

Gross margin sits at 38.6% while operating margin reaches 18.1%, supported by scale efficiencies. The business converts high cash volumes cleanly as it operates.

MoatStrong

Distribution and brand loyalty lock in plumbing contractors who refuse to risk callbacks on unproven heaters. This secures top decile sector standing for returns on equity at 26.9%.

GrowthSlow

Revenue growth is essentially flat at 0.3%, trailing historical periods where demand climbed more dynamically. The top line remains stuck near $3.8 billion.

Financial healthStrong

Debt-to-equity sits near zero with net debt negative at -$38 million, while interest coverage exceeds 32x: debt costs are negligible. Free cash flow reached $736 million, showing strong strengthening.

Insiders

Executives and directors, from SEC Form 4 filings we read ourselves. Open market trades only; grants, option exercises and pre-planned sales left out.

No open market buys or unplanned sales by executives or directors.

Our sealed record on AOS

Verdicts appear here 30 days after we publish them; members see today's. Each one is in the nightly ledger, fingerprinted the night it was made.

The first sealed verdicts appear here on Oct 11, 2026.

Questions

Is AOS a good business?

A. O. Smith scores good on the Cluenex quality check (6.7 of 10), measured against its own industry. Profitability is strong, moat strong, growth slow and financial health strong.

Are insiders buying AOS?

In the last 90 days of SEC Form 4 filings: No open market buys or unplanned sales by executives or directors.

When does AOS report earnings?

Oct 29, 2026.

For members

See AOS today

  • Today's verdict on AOS, and why
  • Fair value with cautious, base and optimistic cases
  • The exact price that would change the verdict
  • Which stocks each signal names, the night it fires
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Cite this page: Cluenex, “A. O. Smith (AOS)”, https://cluenex.com/stocks/aos/, data as of Oct 10, 2026.