DA Davidson Lowers A. O. Smith (AOS) PT amid Housing and China Weakness

A. O. Smith Corporation (NYSE:AOS) is included among the 11 Best Rising Dividend Stocks to Buy Right Now.

DA Davidson Lowers A. O. Smith (AOS) PT amid Housing and China Weakness

On May 4, DA Davidson lowered its price recommendation on A. O. Smith Corporation (NYSE:AOS) to $67 from $75. It reiterated a Neutral rating on the shares following the company’s Q1 earnings miss. The firm said demand in North America’s residential market remained sluggish as the housing environment continued to face pressure. It also pointed to weakness in the WT, or water technology, business. In China, the analyst noted that sell-through trends stayed weak, with sales declining in the high teens year over year due to the lack of stimulus measures and soft consumer confidence. The firm added that the company was working to rebalance inventory during Q2.

During the Q1 2026 earnings call, President, CEO, and Director Stephen Shafer said North America sales increased 1% to $753 million. Sales in the Rest of World segment fell 11% to $201 million. As a result, total company sales declined 2% year over year to $946 million in the first quarter.

Shafer also said earnings per share came in at $0.85, down 11% from the prior year. He attributed the decline mainly to lower sales volumes and transaction-related expenses connected to the Leonard Valve acquisition. Discussing China, Shafer said sales in the region declined 17% in local currency during the quarter. He noted that the performance was in line with the company’s expectations and broader market conditions. He also said the company expects softness in China to continue.

A. O. Smith Corporation (NYSE:AOS) develops technologies and solutions for products sold worldwide. The company operates through its North America and Rest of World segments, manufacturing and marketing residential and commercial gas and electric water heaters, boilers, tanks, and water treatment products.

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