Watts Water (WTS) Stock Analysis
This is a peer-relative look at Watts Water (WTS): its performance, risk, profitability, growth, financial strength, dividend, and valuation are each measured against its Capital Goods peers, so every number reads in context rather than in isolation.
Company Profile
| Profile Item | WTS |
|---|---|
| Name | Watts Water Technologies, Inc. Class A Common Stock |
| Country/Region | United States |
| GICS Sector | Industrials |
| GICS Industry Group | Capital Goods |
| GICS Industry | Machinery |
| GICS Sub-Industry | Industrial Machinery & Supplies & Components |
| Market Capitalization | 11.55 billion USD |
| Currency | USD |
| Exchange | NYSE |
| Listing Date | August 21, 1986 |
| Security Type | Common Stock |
Price Performance
Cumulative Growth
Trailing Returns
Calendar-Year Returns
Performance Metrics
| Metric | Current stock: WTS | Industry group median |
|---|---|---|
| Total Return (1Y) | 33.85% | 6.84% |
| Total Return (3Y, Annualized) | 25.59% | 17.66% |
| Total Return (5Y, Annualized) | 12.56% | 9.09% |
Risk Profile
Drawdown History
Return Distribution
Risk Metrics
| Metric | Current stock: WTS | Industry group median |
|---|---|---|
| Volatility (1Y, Annualized) | 27.38% | 44.38% |
| Beta (5Y) | 1.11 | 1.19 |
| Max Drawdown (5Y) | -44.08% | -49.95% |
Risk-Adjusted Performance
Risk-Return Positioning
Risk-Adjusted Metrics
| Metric | Current stock: WTS | Industry group median |
|---|---|---|
| Sharpe Ratio (1Y) | 1.08 | 0.06 |
| Sortino Ratio (1Y) | 1.78 | 0.09 |
Profitability
ROE (TTM)
Watts Water (WTS) posts ROE of 20.91%, in the upper peer quartile. That suggests the company earns more from each dollar of shareholders’ equity than most industry peers, a useful capital-efficiency signal.
WTS
Capital Goods industry group
20.91%
Group distribution
- Max
- 40.55%
- WTS
- 20.91%
- Q3
- 19.29%
- Median
- 12.12%
- Q1
- 4.08%
- Min
- -17.12%
Largest peers
- GEV
- 93.04%
- CAT
- 56.14%
- GE
- 50.17%
- WTS
- 20.91%
- DE
- 18.24%
- RTX
- 12.85%
- BA
- --
Net Margin (TTM)
Watts Water (WTS) keeps 16.00% of revenue as net profit, putting net margin in the upper peer quartile. After operating costs, interest, and taxes, more of each sales dollar reaches shareholders than it does at most industry peers.
WTS
Capital Goods industry group
16.00%
Group distribution
- Max
- 27.47%
- WTS
- 16.00%
- Q3
- 12.10%
- Median
- 6.30%
- Q1
- 1.40%
- Min
- -12.89%
Largest peers
- GEV
- 23.54%
- GE
- 17.31%
- WTS
- 16.00%
- CAT
- 15.21%
- DE
- 10.17%
- RTX
- 8.75%
- BA
- 8.07%
Operating Margin (TTM)
Watts Water (WTS) turns 20.85% of revenue into operating profit, putting operating margin in the upper peer quartile. Before financing and taxes enter the picture, the day-to-day business keeps more of each sales dollar than most industry peers.
WTS
Capital Goods industry group
20.85%
Group distribution
- Max
- 36.60%
- WTS
- 20.85%
- Q3
- 18.33%
- Median
- 11.12%
- Q1
- 5.14%
- Min
- -12.63%
Largest peers
- WTS
- 20.85%
- CAT
- 20.19%
- GE
- 18.49%
- RTX
- 15.54%
- DE
- 13.37%
- GEV
- 12.77%
- BA
- 0.30%
Profitability Metrics
| Metric | Current stock: WTS | Industry group median |
|---|---|---|
| ROE (TTM) | 20.91% | 12.12% |
| ROA (TTM) | 12.05% | 5.29% |
| Net Margin (TTM) | 16.00% | 6.30% |
| Operating Margin (TTM) | 20.85% | 11.12% |
| Gross Margin (TTM) | 49.09% | 29.63% |
Growth
Revenue Growth
Watts Water (WTS) grew revenue 8.27%, roughly around the peer group's normal range. Top-line momentum looks broadly typical for the industry.
EPS Growth
Watts Water (WTS) grew earnings per share 17.03%, roughly around the peer group's normal range. Bottom-line momentum looks broadly typical for the industry.
Growth Metrics
| Metric | Current stock: WTS | Industry group median |
|---|---|---|
| Revenue Growth (YoY) | 8.27% | 8.11% |
| Revenue Growth (3Y CAGR) | 7.20% | 6.45% |
| EPS Growth (YoY) | 17.03% | 5.45% |
| EPS Growth (3Y CAGR) | 10.78% | 7.15% |
Financial Strength
Current Ratio (MRQ)
Watts Water (WTS) has current ratio of 2.80, in the healthier middle range for its industry. The short-term asset cushion looks balanced relative to peers rather than stretched thin.
WTS
Capital Goods industry group
2.80
Group distribution
- Max
- 5.22
- Q3
- 2.95
- WTS
- 2.80
- Median
- 2.08
- Q1
- 1.43
- Min
- 0.36
Largest peers
- WTS
- 2.80
- DE
- 2.13
- CAT
- 1.42
- BA
- 1.13
- RTX
- 1.05
- GE
- 0.98
- GEV
- 0.83
Debt / Equity (MRQ)
Watts Water (WTS) has debt-to-equity ratio of 0.08, in the lower-leverage quartile for its industry. Borrowing is modest relative to equity compared with most peers, which can leave more flexibility through a cycle.
WTS
Capital Goods industry group
0.08
Group distribution
- Max
- 2.33
- Q3
- 1.12
- Median
- 0.60
- Q1
- 0.29
- WTS
- 0.08
- Min
- 0.00
Largest peers
- BA
- 7.39
- DE
- 2.30
- CAT
- 2.10
- GE
- 1.16
- RTX
- 0.55
- GEV
- 0.30
- WTS
- 0.08
Financial Strength Metrics
| Metric | Current stock: WTS | Industry group median |
|---|---|---|
| Current Ratio (MRQ) | 2.80 | 2.08 |
| Debt / Equity (MRQ) | 0.08 | 0.60 |
| Net Debt / EBITDA | -0.40 | 1.78 |
Dividends
Dividend Yield (TTM)
Watts Water (WTS) has dividend yield of 0.66%, in the industry’s normal income range. It provides a meaningful dividend without the red flag of an unusually high headline yield.
WTS
Capital Goods industry group
0.66%
Group distribution
- Max
- 2.66%
- Q3
- 1.14%
- WTS
- 0.66%
- Median
- 0.24%
- Q1
- 0.00%
- Min
- 0.00%
Largest peers
- RTX
- 1.47%
- CAT
- 1.13%
- DE
- 0.98%
- WTS
- 0.66%
- GE
- 0.56%
- GEV
- 0.26%
- BA
- 0.00%
Dividend Payout Ratio (TTM)
Watts Water (WTS) has payout ratio of 17.24%, within the industry’s typical payout band. The dividend shares profits with investors while leaving earnings coverage that looks normal for the peer group.
WTS
Capital Goods industry group
17.24%
Group distribution
- Max
- 67.39%
- Q3
- 28.02%
- WTS
- 17.24%
- Median
- 6.86%
- Q1
- 0.00%
- Min
- 0.00%
Largest peers
- RTX
- 45.85%
- DE
- 36.02%
- CAT
- 24.18%
- GE
- 20.23%
- WTS
- 17.24%
- GEV
- 4.59%
- BA
- 0.00%
Dividend Metrics
| Metric | Current stock: WTS | Industry group median |
|---|---|---|
| Dividend Yield (TTM) | 0.66% | 0.24% |
| Dividend Payout Ratio (TTM) | 17.24% | 6.86% |
Valuation
P/E Ratio (TTM)
Watts Water (WTS) trades at P/E ratio of 25.95, near the industry’s usual earnings multiple. The stock is not showing a clear peer discount or premium on trailing earnings.
WTS
Capital Goods industry group
25.95
Group distribution
- Max
- 59.38
- Q3
- 35.92
- WTS
- 25.95
- Median
- 25.41
- Q1
- 19.47
- Min
- 3.03
Largest peers
- DE
- 37.33
- GE
- 36.94
- RTX
- 30.82
- WTS
- 25.95
- CAT
- 21.92
- GEV
- 20.32
- BA
- 17.89
P/S Ratio (TTM)
Watts Water (WTS) trades at 4.14 on P/S ratio, in the higher sales-valuation quartile. Investors are paying up for each dollar of revenue, so stronger margins, growth, or revenue quality need to carry that price.
WTS
Capital Goods industry group
4.14
Group distribution
- Max
- 7.54
- WTS
- 4.14
- Q3
- 3.76
- Median
- 2.15
- Q1
- 1.03
- Min
- 0.03
Largest peers
- GE
- 6.38
- GEV
- 4.65
- WTS
- 4.14
- DE
- 3.78
- CAT
- 3.29
- RTX
- 2.66
- BA
- 1.45
P/B Ratio (MRQ)
Watts Water (WTS) trades at 4.98 on P/B ratio, roughly in line with the industry’s normal price-to-book range. Its balance sheet is not being priced at a clear discount or premium versus peers.
WTS
Capital Goods industry group
4.98
Group distribution
- Max
- 9.66
- Q3
- 5.00
- WTS
- 4.98
- Median
- 3.12
- Q1
- 1.81
- Min
- -1.08
Largest peers
- BA
- 20.99
- GE
- 19.06
- GEV
- 18.00
- CAT
- 11.90
- DE
- 6.47
- WTS
- 4.98
- RTX
- 3.69
Valuation Metrics
| Metric | Current stock: WTS | Industry group median |
|---|---|---|
| P/E Ratio (TTM) | 25.95 | 25.41 |
| P/S Ratio (TTM) | 4.14 | 2.15 |
| P/B Ratio (MRQ) | 4.98 | 3.12 |
| Free Cash Flow Yield (TTM) | 2.21% | 3.03% |