A Business at a Glance
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WATTS WATER TECHNOLOGIES INC
WTS
$11.5B
Mkt Cap
$344.45
+0.23%
WATTS WATER TECHNOLOGIES INC (WTS) has a current P/E ratio of 33.9, compared to its historical median P/E of 25.6. The stock is currently considered Expensive based on its historical valuation range.
WATTS WATER TECHNOLOGIES INC (WTS) has a 5-year average return on invested capital (ROIC) of 19.9%. This indicates strong capital allocation and a potential competitive advantage.
WATTS WATER TECHNOLOGIES INC (WTS) has a market capitalization of $11.5B. It is classified as a large-cap stock.
Yes, WATTS WATER TECHNOLOGIES INC (WTS) pays a dividend with a trailing twelve-month yield of 0.61%. The company also returns capital through share buybacks, with a buyback yield of 0.14%.
Based on historical P/E analysis, WATTS WATER TECHNOLOGIES INC (WTS) appears expensive. The current P/E of 33.9 is 32% above its historical median of 25.6. The estimated fair value CAGR (P/E method) is 18.7%.
WATTS WATER TECHNOLOGIES INC (WTS) operates in the Miscellaneous Fabricated Metal Products industry, within the Industrials sector.
Watts Water Technologies is a global manufacturer of water technologies and solutions for commercial and residential buildings across the Americas, Europe, and APMEA regions. The company operates through a diversified product portfolio focused on three core themes—safety and regulation, energy efficiency, and water conservation—serving customers through wholesale and retail distribution channels. Watts earns revenue through the sale of differentiated products and integrated solutions that manage and conserve the flow of fluids and energy into, through, and out of buildings, with a business model anchored on organic growth through new product introduction and market expansion, supplemented by strategic acquisitions. The company has developed a digital strategy centered on three dimensions—connect, control, and conserve—exemplified by its Nexa intelligent water management platform, which combines smart and connected equipment with cloud-based software to provide building-level visibility and operational oversight. Watts maintains a competitive moat through its established distribution channels, preferred brand portfolio, and proprietary digital and connected product capabilities, while pursuing operational leverage through systematic manufacturing cost reduction and the One Watts Performance System. The company has completed 17 acquisitions since 2016 and targets select acquisitions in core and complementary markets to drive incremental growth and expand its global presence.
【Strong momentum with macro headwinds】 Management expects continued pricing and repair-and-replacement activity to fuel growth in 2026, supported by positive global GDP trends in core end markets, though new residential and non-residential construction is anticipated to remain soft, particularly in Europe. The company is advancing its digital strategy with Nexa gaining traction and expanding its data center cooling applications, which are experiencing strong momentum with sales more than doubling in the first quarter of 2026. Watts is implementing targeted pricing strategies and productivity initiatives to mitigate the impact of the Middle East conflict and elevated freight and energy costs, while maintaining disciplined capital allocation including a 21% dividend increase announced in June 2026. The company faces ongoing uncertainty from macroeconomic and geopolitical factors, including the Middle East conflict and downward revisions of global GDP forecasts, and is maintaining its full-year 2026 outlook pending further visibility on these external factors.
| Metric | Target | Period |
|---|---|---|
| Consolidated organic sales growth | +2% to +6% | FY2026 |
| Consolidated reported sales growth | +8% to +12% | FY2026 |
| Adjusted EBITDA margin | 21.5%-22.1% | FY2026 |
| Adjusted operating margin | 19.1%-19.7% | FY2026 |
| Free cash flow conversion | ≥90% of net income | FY2026 |
Consolidated organic sales growth (FY2026): “Consolidated organic sales growth is expected to be between +2% and +6%”
Consolidated reported sales growth (FY2026): “our reported sales growth is expected to be between +8% and +12%”
Adjusted EBITDA margin (FY2026): “We expect adjusted EBITDA margin to be in the range of 21.5%-22.1%”
Adjusted operating margin (FY2026): “the adjusted operating margin between 19.1% and 19.7%”
Free cash flow conversion (FY2026): “We expect free cash flow conversion at or above 90% of net income for 2026”
Generated solely from the company's own reports listed below — not from third-party data. Hallucination risk is low. · Sources: 10-K, Q4 FY2025 Earnings Call, Q3 FY2025 Earnings Call, Q2 FY2025 Earnings Call, Q1 FY2025 Earnings Call
| Metric | TTM | FY2025 | FY2024 | FY2023 | FY2022 | FY2021 |
|---|---|---|---|---|---|---|
| Revenue | 2.6B | 2.4B | 2.3B | 2.1B | 2.0B | 1.8B |
| Net Income | 366M | 341M | 291M | 262M | 252M | 166M |
| EPS | $10.94 | $10.17 | $8.69 | $7.82 | $7.48 | $4.88 |
| Free Cash Flow | 317M | 356M | 326M | 281M | 196M | 154M |
| ROIC | 19.2% | 20.5% | 19.7% | 20.2% | 23.3% | 16.0% |
| Gross Margin | 49.2% | 49.5% | 47.2% | 46.7% | 44.2% | 42.4% |
| Debt/Equity | 0.09 | 0.10 | 0.12 | 0.20 | 0.12 | 0.12 |
| Dividends/Share | $2.09 | $1.99 | $1.65 | $1.38 | $1.16 | $1.01 |
| Operating Income | 493M | 448M | 390M | 351M | 315M | 240M |
| Operating Margin | 19.3% | 18.4% | 17.3% | 17.1% | 15.9% | 13.2% |
| ROE | 17.5% | 18.2% | 18.1% | 18.6% | 20.3% | 14.8% |
| Shares Outstanding | 34M | 34M | 34M | 34M | 34M | 34M |
| Metric | |||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Income Statement | |||||||||||||
| Revenue | 1.5B | 1.5B | 1.4B | 1.5B | 1.6B | 1.6B | 1.5B | 1.8B | 2.0B | 2.1B | 2.3B | 2.4B | 2.6B |
| Gross Margin | 35.8% | 37.7% | 40.4% | 41.4% | 42.0% | 42.3% | 41.5% | 42.4% | 44.2% | 46.7% | 47.2% | 49.5% | 49.2% |
| R&D | 23M | 24M | 27M | 29M | 35M | 40M | 42M | 46M | 59M | 67M | 70M | 74M | 76M |
| SG&A | 407M | 491M | 424M | 432M | 465M | 476M | 434M | 508M | 549M | 605M | 664M | 734M | 760M |
| EBIT | 105M | -90M | 145M | 162M | 188M | 197M | 181M | 240M | 315M | 351M | 390M | 448M | 493M |
| Op. Margin | 7.0% | -6.1% | 10.4% | 11.1% | 12.0% | 12.3% | 12.0% | 13.2% | 15.9% | 17.1% | 17.3% | 18.4% | 19.3% |
| Net Income | 50M | -113M | 84M | 73M | 128M | 132M | 114M | 166M | 252M | 262M | 291M | 341M | 366M |
| Net Margin | 3.3% | -7.7% | 6.0% | 5.0% | 8.2% | 8.2% | 7.6% | 9.2% | 12.7% | 12.7% | 12.9% | 14.0% | 14.3% |
| Non-Recurring | 3.1M | 152M | 14M | 6.8M | 3.4M | 4.3M | 9.3M | 19M | 12M | 5.5M | 7.2M | 24M | 6.6M |
| Returns on Capital | |||||||||||||
| ROIC | 5.7% | -8.2% | 8.6% | 9.3% | 10.8% | 13.1% | 11.7% | 16.0% | 23.3% | 20.2% | 19.7% | 20.5% | 19.2% |
| ROE | 5.3% | -14.0% | 11.7% | 9.3% | 14.9% | 14.1% | 11.2% | 14.8% | 20.3% | 18.6% | 18.1% | 18.2% | 17.5% |
| ROA | 2.7% | -6.2% | 4.9% | 4.2% | 7.6% | 7.8% | 6.6% | 9.2% | 13.3% | 12.4% | 12.4% | 12.9% | 12.5% |
| Cash Flow | |||||||||||||
| Op. Cash Flow | 135M | 109M | 138M | 156M | 169M | 194M | 229M | 181M | 224M | 311M | 361M | 402M | 365M |
| Free Cash Flow | 112M | 82M | 102M | 127M | 134M | 165M | 185M | 154M | 196M | 281M | 326M | 356M | 317M |
| Owner Earnings | 78M | 46M | 74M | 90M | 107M | 130M | 170M | 113M | 166M | 247M | 287M | 324M | 283M |
| CapEx | 24M | 28M | 36M | 29M | 36M | 29M | 44M | 27M | 28M | 30M | 35M | 46M | 47M |
| Maint. CapEx | 48M | 52M | 51M | 52M | 49M | 47M | 47M | 45M | 40M | 43M | 54M | 57M | 59M |
| Growth CapEx | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| D&A | 48M | 52M | 51M | 52M | 49M | 47M | 47M | 45M | 40M | 43M | 54M | 57M | 59M |
| CapEx/OCF | 17.5% | 25.3% | 26.1% | 18.9% | 21.2% | 15.1% | 19.1% | 14.8% | 12.5% | 9.6% | 9.8% | 11.4% | 13.0% |
| Capital Allocation | |||||||||||||
| Dividends Paid | 21M | 23M | 25M | 26M | 28M | 31M | 31M | 34M | 40M | 47M | 56M | 67M | 70M |
| Dividend Yield | 1.1% | 1.3% | 1.3% | 1.2% | 1.1% | 1.1% | 1.0% | 0.7% | 0.9% | 0.8% | 0.8% | 0.8% | 0.6% |
| Share Buybacks | 40M | 45M | 27M | 18M | 26M | 20M | 29M | 16M | 69M | 16M | 17M | 16M | 16M |
| Buyback Yield | 1.9% | 2.8% | 1.3% | 0.7% | 1.3% | 0.6% | 0.7% | 0.3% | 1.5% | 0.2% | 0.3% | 0.2% | 0.1% |
| Stock-Based Comp | 8.6M | 11M | 13M | 14M | 14M | 18M | 13M | 23M | 18M | 20M | 20M | 21M | 24M |
| Debt Repayment | 2.3M | 2.0M | 614M | 178M | 195M | 127M | 518M | 95M | 80M | 90M | 100M | 0 | 0 |
| Balance Sheet | |||||||||||||
| Net Debt | 279M | 279M | 312M | 217M | 149M | 131M | -19M | -99M | -160M | -51M | -187M | -207M | -177M |
| Cash & Equiv. | 301M | 296M | 338M | 280M | 204M | 220M | 219M | 242M | 311M | 350M | 387M | 406M | 375M |
| Long-Term Debt | 578M | 574M | 511M | 475M | 323M | 204M | 198M | 142M | 148M | 298M | 197M | 198M | 198M |
| Debt/Equity | 0.64 | 0.82 | 0.88 | 0.60 | 0.40 | 0.36 | 0.19 | 0.12 | 0.12 | 0.20 | 0.12 | 0.10 | 0.09 |
| Interest Coverage | 5.3 | -3.7 | 6.4 | 8.5 | 11.6 | 14.0 | 13.6 | 38.0 | 45.0 | 42.8 | 26.6 | 41.5 | 46.1 |
| Equity | 912M | 705M | 736M | 829M | 891M | 978M | 1.1B | 1.2B | 1.3B | 1.5B | 1.7B | 2.0B | 2.1B |
| Total Assets | 1.9B | 1.7B | 1.8B | 1.7B | 1.7B | 1.7B | 1.7B | 1.9B | 1.9B | 2.3B | 2.4B | 2.9B | 2.9B |
| Total Liabilities | 1.0B | 986M | 1.0B | 908M | 762M | 745M | 668M | 682M | 630M | 796M | 689M | 854M | -2.9M |
| Intangibles | 210M | 193M | 203M | 185M | 165M | 151M | 142M | 129M | 114M | 216M | 235M | 295M | 287M |
| Retained Earnings | 501M | 318M | 349M | 373M | 441M | 514M | 560M | 666M | 795M | 979M | 1.2B | 1.4B | 1.5B |
| Working Capital | 529M | 514M | 394M | 456M | 373M | 316M | 397M | 453M | 572M | 655M | 666M | 774M | 852M |
| Current Assets | 874M | 809M | 819M | 784M | 721M | 735M | 710M | 862M | 951M | 1.1B | 1.1B | 1.3B | 1.3B |
| Current Liabilities | 346M | 295M | 426M | 327M | 349M | 419M | 313M | 409M | 379M | 406M | 418M | 512M | 496M |
| Per Share Data | |||||||||||||
| EPS | 1.42 | -3.24 | 2.44 | 2.12 | 3.73 | 3.85 | 3.36 | 4.88 | 7.48 | 7.82 | 8.69 | 10.17 | 10.94 |
| Owner EPS | 2.22 | 1.32 | 2.13 | 2.60 | 3.12 | 3.79 | 4.99 | 3.32 | 4.93 | 7.38 | 8.57 | 9.67 | 8.44 |
| Book Value | 25.76 | 20.23 | 21.34 | 24.04 | 25.97 | 28.63 | 31.45 | 34.55 | 38.68 | 45.15 | 50.97 | 60.51 | 62.58 |
| Cash Flow/Share | 3.82 | 3.14 | 4.00 | 4.52 | 4.94 | 5.68 | 6.73 | 5.32 | 6.66 | 9.27 | 10.78 | 12.00 | 12.68 |
| Dividends/Share | 0.58 | 0.66 | 0.71 | 0.75 | 0.82 | 0.90 | 0.92 | 1.01 | 1.16 | 1.38 | 1.65 | 1.99 | 2.09 |
| Shares Out. | 35.4M | 34.8M | 34.5M | 34.5M | 34.3M | 34.2M | 34.0M | 34.0M | 33.6M | 33.5M | 33.5M | 33.5M | 33.5M |
| Valuation | |||||||||||||
| P/E Ratio | 40.8 | N/A | 24.7 | 33.8 | 16.2 | 24.7 | 34.8 | 38.2 | 18.9 | 26.5 | 23.2 | 27.9 | 31.5 |
| P/FCF | 18.4 | 19.8 | 20.4 | 19.5 | 15.5 | 19.7 | 21.5 | 41.1 | 24.2 | 24.7 | 20.8 | 26.7 | 36.4 |
| EV/EBIT | 19.3 | N/A | 15.1 | 15.0 | 10.9 | 16.3 | 21.2 | 25.0 | 13.6 | 18.7 | 15.8 | 19.9 | 23.0 |
| Price/Book | 2.2 | 2.3 | 2.8 | 3.0 | 2.3 | 3.3 | 3.7 | 5.4 | 3.6 | 4.6 | 4.0 | 4.7 | 5.5 |
| Price/Sales | 1.2 | 1.2 | 1.3 | 1.4 | 1.6 | 1.8 | 2.1 | 2.7 | 2.3 | 2.8 | 2.9 | 3.3 | 4.5 |
| FCF Yield | 5.4% | 5.1% | 4.9% | 5.1% | 6.4% | 5.1% | 4.6% | 2.4% | 4.1% | 4.0% | 4.8% | 3.7% | 2.7% |
| Market Cap | 2.1B | 1.6B | 2.1B | 2.5B | 2.1B | 3.2B | 4.0B | 6.3B | 4.7B | 7.0B | 6.8B | 9.5B | 11.5B |
| Avg. Price | 53.19 | 49.68 | 53.83 | 60.56 | 72.61 | 82.53 | 91.16 | 145.13 | 138.19 | 171.77 | 198.25 | 243.29 | 344.45 |
| Year-End Price | 57.93 | 46.33 | 60.30 | 71.67 | 60.45 | 94.94 | 117.06 | 186.44 | 141.10 | 207.44 | 201.80 | 283.81 | 344.45 |
WATTS WATER TECHNOLOGIES INC passes 5 of 9 quality checks, suggesting mixed fundamentals.
WATTS WATER TECHNOLOGIES INC trades at 33.9x trailing earnings, compared to its 15-year median P/E of 25.6x, suggesting it is currently Expensive relative to its historical range. On a free-cash-flow basis, the stock trades at 26.5x vs a median of 21.1x. The company's 5-year average ROIC is 19.9% with a gross margin of 46.0%. Total shareholder yield (dividends + buybacks) is 0.7%. At current prices, the estimated annualized return to fair value is +18.9%.
WATTS WATER TECHNOLOGIES INC (WTS) reported annual revenue of $2.4 billion in its most recent fiscal year, based on SEC EDGAR filings.
WATTS WATER TECHNOLOGIES INC (WTS) has a net profit margin of 14.0%. This is a healthy margin.
WATTS WATER TECHNOLOGIES INC (WTS) generated $356 million in free cash flow in its most recent fiscal year. Positive free cash flow supports dividends, buybacks, and debt reduction.
WATTS WATER TECHNOLOGIES INC (WTS) has a debt-to-equity ratio of 0.10. This indicates a conservatively financed balance sheet.
WATTS WATER TECHNOLOGIES INC (WTS) reported earnings per share (EPS) of $10.17 in its most recent fiscal year.
WATTS WATER TECHNOLOGIES INC (WTS) has a return on equity (ROE) of 18.2%. This indicates the company generates strong returns for shareholders.
WATTS WATER TECHNOLOGIES INC (WTS) has a 5-year average gross margin of 46.0%. This indicates decent pricing power.
The Ledger Terminal provides 16 years of financial data for WATTS WATER TECHNOLOGIES INC (WTS), sourced directly from SEC EDGAR filings. This includes income statements, balance sheets, cash flow statements, and key financial ratios.
WATTS WATER TECHNOLOGIES INC (WTS) has a book value per share of $60.51, based on its most recent annual SEC filing.
Based on recent SEC filings and earnings disclosures, Management expects continued pricing and repair-and-replacement activity to fuel growth in 2026, supported by positive global GDP trends in core end markets, though new residential and non-residential construction is anticipated to remain soft, particularly in Europe. The company is advancing its digital strategy with Nexa gaining traction and expanding its data center cooling applications, which are experiencing strong momentum with sales more than doubling in the first quarter of 2026. Watts is implementing targeted pricing strategies and productivity initiatives to mitigate the impact of the Middle East conflict and elevated freight and energy costs, while maintaining disciplined capital allocation including a 21% dividend increase announced in June 2026. The company faces ongoing uncertainty from macroeconomic and geopolitical factors, including the Middle East conflict and downward revisions of global GDP forecasts, and is maintaining its full-year 2026 outlook pending further visibility on these external factors.
Based on recent SEC filings and earnings calls, WATTS WATER TECHNOLOGIES INC (WTS) has provided the following forward guidance: Consolidated organic sales growth: +2% to +6% (FY2026); Consolidated reported sales growth: +8% to +12% (FY2026); Adjusted EBITDA margin: 21.5%-22.1% (FY2026); Adjusted operating margin: 19.1%-19.7% (FY2026); Free cash flow conversion: ≥90% of net income (FY2026).