Latest Ratios: P/E Ratio 16.2x · EV/EBITDA 11.1x · ROE 29.2%. (1996–2025 historical series)
Price-based multiples — how expensive the stock is relative to earnings, sales, book value, and cash flow
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Market Cap | $8.7B | $9.4B | $10.0B | $12.4B | $8.9B | $13.8B | $8.9B | $7.9B | $7.4B | $10.7B | $8.4B |
| Enterprise Value | $8.7B | $9.4B | $10.0B | $12.3B | $8.9B | $13.6B | $8.5B | $7.9B | $7.3B | $10.8B | $8.4B |
| P/E Ratio → | 16.18 | 17.33 | 18.79 | 22.34 | 37.91 | 28.43 | 25.86 | 21.46 | 16.55 | 36.05 | 25.59 |
| P/S Ratio | 2.28 | 2.44 | 2.63 | 3.23 | 2.38 | 3.91 | 3.08 | 2.65 | 2.31 | 3.57 | 3.12 |
| P/B Ratio | 4.70 | 5.04 | 5.33 | 6.75 | 5.10 | 7.56 | 4.82 | 4.76 | 4.28 | 6.49 | 5.53 |
| P/FCF | 15.98 | 17.14 | 21.17 | 20.83 | 27.77 | 24.47 | 17.64 | 20.27 | 20.22 | 46.08 | 22.88 |
| P/OCF | 14.15 | 15.17 | 17.24 | 18.57 | 22.78 | 21.60 | 15.86 | 17.41 | 16.38 | 32.78 | 18.75 |
P/E links to full P/E history page with 30-year chart
Enterprise-value multiples — capital-structure-neutral measures of total business value
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| EV / Revenue | — | 2.45 | 2.62 | 3.18 | 2.37 | 3.85 | 2.93 | 2.64 | 2.29 | 3.59 | 3.11 |
| EV / EBITDA | 11.06 | 11.86 | 12.58 | 14.68 | 12.09 | 19.82 | 16.13 | 14.48 | 11.73 | 18.22 | 15.92 |
| EV / EBIT | 12.01 | 12.85 | 14.14 | 16.45 | 38.15 | 21.63 | 18.81 | 16.33 | 12.92 | 20.27 | 17.81 |
| EV / FCF | — | 17.17 | 21.13 | 20.52 | 27.69 | 24.07 | 16.80 | 20.14 | 20.11 | 46.35 | 22.86 |
Margins and return-on-capital ratios measuring operating efficiency
Full margin charts and quarterly trend are on the Earnings History page
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Gross Margin | 38.8% | 38.8% | 38.1% | 38.5% | 35.4% | 37.0% | 38.3% | 39.5% | 41.0% | 41.3% | 41.7% |
| Operating Margin | 19.0% | 19.0% | 18.8% | 19.7% | 17.5% | 17.2% | 15.4% | 15.6% | 17.3% | 17.4% | 17.1% |
| Net Profit Margin | 14.3% | 14.3% | 14.0% | 14.4% | 6.3% | 13.8% | 11.9% | 12.4% | 13.9% | 9.9% | 12.2% |
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| ROE | 29.2% | 29.2% | 28.6% | 31.0% | 13.2% | 26.5% | 19.6% | 21.9% | 26.4% | 18.7% | 22.1% |
| ROA | 17.1% | 17.1% | 16.5% | 17.0% | 6.9% | 14.7% | 11.1% | 12.1% | 14.2% | 9.7% | 11.8% |
| ROIC | 29.2% | 29.2% | 30.5% | 33.6% | 29.7% | 30.2% | 22.0% | 21.3% | 24.4% | 24.2% | 24.0% |
| ROCE | 31.5% | 31.5% | 31.1% | 32.5% | 27.7% | 26.3% | 19.5% | 20.4% | 23.5% | 23.0% | 22.4% |
Solvency and debt-coverage ratios — lower is generally safer
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Debt / Equity | 0.10 | 0.10 | 0.12 | 0.08 | 0.21 | 0.12 | 0.08 | 0.19 | 0.13 | 0.25 | 0.21 |
| Debt / EBITDA | 0.24 | 0.24 | 0.27 | 0.19 | 0.50 | 0.32 | 0.28 | 0.59 | 0.36 | 0.69 | 0.62 |
| Net Debt / Equity | — | 0.01 | -0.01 | -0.10 | -0.01 | -0.12 | -0.23 | -0.03 | -0.02 | 0.04 | -0.00 |
| Net Debt / EBITDA | 0.02 | 0.02 | -0.03 | -0.22 | -0.03 | -0.33 | -0.81 | -0.09 | -0.06 | 0.11 | -0.01 |
| Debt / FCF | — | 0.03 | -0.05 | -0.31 | -0.08 | -0.40 | -0.84 | -0.13 | -0.11 | 0.27 | -0.02 |
| Interest Coverage | 54.03 | 54.03 | 105.63 | 62.13 | 24.80 | 146.49 | 61.81 | 43.92 | 67.40 | 52.56 | 64.36 |
Short-term solvency ratios and asset-utilisation metrics
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Current Ratio | 1.50 | 1.50 | 1.55 | 1.59 | 1.75 | 1.57 | 1.83 | 1.96 | 2.09 | 2.24 | 2.04 |
| Quick Ratio | 0.94 | 0.94 | 0.96 | 1.06 | 1.20 | 1.17 | 1.49 | 1.56 | 1.70 | 1.87 | 1.71 |
| Cash Ratio | 0.22 | 0.22 | 0.31 | 0.38 | 0.52 | 0.56 | 0.78 | 0.72 | 0.82 | 1.04 | 0.99 |
| Asset Turnover | — | 1.22 | 1.18 | 1.20 | 1.13 | 1.02 | 0.92 | 0.98 | 1.04 | 0.94 | 0.93 |
| Inventory Turnover | 4.89 | 4.89 | 4.44 | 4.76 | 4.69 | 4.98 | 5.96 | 5.98 | 6.18 | 6.04 | 6.24 |
| Days Sales Outstanding | — | 55.49 | 51.76 | 56.46 | 56.51 | 65.43 | 73.75 | 71.90 | 74.11 | 72.89 | 70.49 |
Earnings, FCF, buyback, and dividend yields — total returns to shareholders
Full dividend history and growth charts are on the Dividend History page
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Dividend Yield | 2.2% | 2.1% | 1.9% | 1.5% | 2.0% | 1.2% | 1.8% | 1.9% | 1.8% | 0.9% | 1.0% |
| Payout Ratio | 35.8% | 35.8% | 35.7% | 33.0% | 75.2% | 34.9% | 46.0% | 40.3% | 29.3% | 32.7% | 25.8% |
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings Yield | 6.2% | 5.8% | 5.3% | 4.5% | 2.6% | 3.5% | 3.9% | 4.7% | 6.0% | 2.8% | 3.9% |
| FCF Yield | 6.3% | 5.8% | 4.7% | 4.8% | 3.6% | 4.1% | 5.7% | 4.9% | 4.9% | 2.2% | 4.4% |
| Buyback Yield | 4.6% | 4.3% | 3.0% | 2.5% | 4.5% | 2.6% | 0.6% | 3.6% | 2.8% | 1.3% | 1.6% |
| Total Shareholder Yield | 6.8% | 6.4% | 4.9% | 3.9% | 6.5% | 3.9% | 2.4% | 5.5% | 4.5% | 2.2% | 2.6% |
| Shares Outstanding | — | $140M | $147M | $151M | $156M | $161M | $163M | $167M | $172M | $175M | $177M |
China market demand volatility
According to current market data, AOS trades at a forward P/E of 16.33, which appears to command a premium over broader industrial machinery peers, reflecting investor confidence in the company's non-discretionary replacement-driven revenue stream despite the recent deceleration in top-line growth observed in recent quarterly filings.
The valuation multiple suggests that the market is pricing in the stability of the North American replacement cycle rather than aggressive growth. Investors should monitor whether this premium remains sustainable if the company fails to offset the ongoing weakness in the Chinese real estate market through its water treatment expansion.
Based on reported financial statements, the company's ROIC has trended downward from 8.5% in 2024Q2 to 5.4% in 2026Q1, indicating that the firm is currently struggling to maintain its historical compounding efficiency as revenue growth stalls and capital intensity increases across its global manufacturing footprint.
The compression in ROIC suggests that recent investments, including acquisitions, have yet to yield returns exceeding the cost of capital in the current environment. This trend warrants further investigation into whether the company's capital allocation strategy is becoming less efficient due to the shifting product mix toward lower-margin water treatment solutions.
As indicated by the latest quarterly data, the cash conversion cycle has fluctuated significantly, reaching 56 days in 2025Q4 compared to 44 days in 2024Q1, which suggests that management is facing increased difficulty in optimizing inventory levels amidst the current demand normalization in the North American market.
The volatility in the cash conversion cycle implies that the company may be holding excess inventory in anticipation of demand that has not materialized. This inefficiency appears to be a primary driver of the recent variability in free cash flow, suggesting that operational leverage is currently under pressure.
Based on the most recent quarterly filings, the company maintains a current ratio of 1.56, which, while slightly lower than historical peaks, provides a robust liquidity buffer that appears sufficient to navigate the current period of revenue stagnation and potential geopolitical risks in the Rest of World segment.
The company's ability to maintain a quick ratio of 1.00 indicates that it is not overly reliant on inventory liquidation to meet short-term obligations. This liquidity position provides management with significant flexibility to pursue opportunistic share repurchases or strategic M&A if industrial sector valuations continue to compress.
The P/E ratio is frequently misapplied to A. O. Smith because it obscures the impact of non-recurring warranty reserve adjustments and working capital swings that often decouple net income from actual cash generation, making it a potentially misleading metric for assessing the company's true underlying earning power.
Investors should instead prioritize the EV/EBITDA multiple and free cash flow conversion, as these metrics better account for the company's low debt levels and the capital-intensive nature of its manufacturing operations. Relying solely on P/E may lead to an incomplete understanding of the company's resilience during periods of commodity price volatility.
Includes 30+ ratios · 30 years · Updated daily
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Quick answers to the most common questions about buying AOS stock.
A. O. Smith Corporation's current P/E ratio is 16.2x. The historical average is 19.8x. This places it at the 40th percentile of its historical range.
A. O. Smith Corporation's current EV/EBITDA is 11.1x. This enterprise value multiple compares the company's total value (equity + debt - cash) to its EBITDA. The historical average is 11.3x.
A. O. Smith Corporation's return on equity (ROE) is 29.2%. This is above the typical threshold of 15-20% considered good for most companies. The historical average is 17.0%.
Based on historical data, A. O. Smith Corporation is trading at a P/E of 16.2x. This is at the 40th percentile of its historical P/E range. Compare with industry peers and growth rates for a complete picture.
A. O. Smith Corporation's current dividend yield is 2.24% with a payout ratio of 35.8%.
A. O. Smith Corporation has 38.8% gross margin and 19.0% operating margin. Operating margin between 10-20% is typical for established companies.
A. O. Smith Corporation's Debt/EBITDA ratio is 0.2x, indicating low leverage. A ratio below 2x is generally considered financially healthy.