Determining whether a firm is one of the best stocks to buy now requires a detailed examination of that firm. In this report, we will be focusing on A.O. Smith Corporation.
Background
A.O. Smith (AOS) is a manufacturer of water heating equipment. The company serves both commercial and residential markets, primarily in the U.S. And it is headquartered in Milwaukee, Wisconsin.
The company operates in one segment, Water Products. Water Products business includes water heaters, water heating equipment, copper-tube boilers, water treatment products, and water tanks.
Stock Fundamentals
AOS maintains a fairly conservative balance sheet. This is good, because its core business can be quite erratic. It has some of the lowest scores for the consistency of its growth of any firm we cover, and its beta is definitely on the high side.
The news isn’t all bad. Over the last seven to eight years, AOS has been able to grow its dividend along with its profits. AOS deserves high marks for the reliability with which it has grown its dividends since (at least) the crisis year of 2008.
Unfortunately the market has recognized this ability as well. The price of A.O. Smith’s stock is now almost 700 percent higher than it was at the end of 2008.
AOS is a good company; but it is not a good stock. It is justifiably richly priced. And it presents no bargain. We do not consider AOS one of the best stocks to buy now.
Stat Sheet – A.O. Smith Corporation 4/29/16
| Ticker | AOS |
| Industry | Electronic Instruments & Controls |
| Price | $ 77.33 |
| Market Cap | $ 6859 |
| Dividend Yield | 1.24 |
| Dividend/CFOp | 0.203 |
| Equity/Assets | 0.547 |
| Average Equity/Assets | 0.411 |
| Financial Strength | Above Average |
| Growth Prospects | Average |
| Beta | 1.48 |
| Price Volatility | Above Average |
| Stock Fundamentals | C |
(Our assessment of this firm’s fundamentals will be in effect for the rest of calendar year 2016.)
We cover many more companies in addition to AOS. If you would like to see just some of the research we make available on these other companies, click the link below.
If you would like to learn why we have a bias in favor of the best dividend stocks, click the link below.
Disclaimer – Information contained herein has been obtained from sources believed to be reliable. Neither the author nor the publisher guarantees the accuracy or completeness of the information and methods described. This information is offered as general commentary only. It is not intended as investment advice. Investment and trading of securities involves risk, including of loss of capital. Market conditions change over time, and no assurance can be given that a reader may apply the principles described to make a profit. The author and publisher expressly disclaim all and any liability to any person for any investment or trading decisions that the reader may make in reliance on this information.
vershire 