AOS
A. O. Smith
Hybrid Industrial
★ Quality 64/100Price today
$61.65
Current discount
+13.5%
charlieapp.co
We are reviewing the data for this asset. For now we are not showing the calculated value or the signal — both come back as soon as the review is done.
What this business is made of
Price vs Intrinsic Value
The line is the price month by month; the green band marks when it's undervalued (−20% off value). When the price drops in there, the discount is real, not opinion.
How many times the cash flow
Hybrid Industrial · vs 55 peers
You pay 15.5x times this business's cash flow; its sector median is 33.4x.
14% below what Charlie thinks it's worth (17.7x) — that gap is your safety margin.
Why does Charlie give it 17.7x?
The multiple is how many times its cash flow the business is worth.
An average business of its kind is worth 33.4x. This one drops from there:
External cyclicality. it depends on a cycle (rates, recession) it doesn't control.
Reinvests at high returns. every dollar it reinvests earns far above its cost.
Compounds dividends. it pays and sustains a dividend that grows over the years.
That's why it's worth 17.7x, less than the 33.4x average.
The business
Vende el calentador de agua que nadie piensa hasta que se congela en la ducha.
A. O. Smith fabrica calentadores de agua (de tanque y sin tanque), calderas y sistemas de tratamiento de agua para hogares y comercios. Cobra por cada equipo vendido vía distribuidores y grandes minoristas; cerca del 80% de sus ventas en Norteamérica son reemplazos, no obra nueva. Factura unos $3.8B al año con margen bruto del 39%.
Su fuerza está en la distribución y la marca: cuando se te revienta el calentador, lo reemplazas ya, por el que tenga el plomero a mano. Eso le da demanda recurrente y poder de precio modesto. No es un foso infranqueable: Rheem y Bradford White pelean el mismo pasillo.
Revenue history
From $3.8B to $3.9B in 4 years. Sales aren't taking off — the engine is stuck.
Where each $100 of sales goes
Revenue $3.8B · FY2025
Of every $100 in sales, $86 goes to costs and operations; $14 is left as net profit (14% margin).
Catalysts and risks
India creciendo a doble dígito, base pequeña con espacio largo.
Recuperación del consumo en China, su segundo mercado.
Ciclo de reemplazo en Norteamérica sostiene el 80% de ventas sin depender de obra nueva.
Exposición a China: una desaceleración allí golpea directo los ingresos.
El acero y el cobre suben y comprimen el margen del 39%.
Crecimiento de apenas 2%: el negocio madura y hay poco viento a favor.
Charlie's note
“Pagar más de 17x por un negocio que crece al 2% es pagar precio de crecimiento por un caballo de tiro. Buena empresa, aburrida y predecible; solo que no la quieres cara.”
Analysis · October 2026
Charlie informs, it doesn't advise. No information should be taken as a recommendation to buy or sell.