Is Watts Water's 39% Increase in 2025 Already Reflected in Its Growth Narrative?
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Dec 21 2025
0mins
Should l Buy WTS?
Source: Yahoo Finance
Stock Performance: Watts Water Technologies has seen significant stock gains, with a 39.5% increase year-to-date and a 140.5% rise over the past five years, driven by trends in water infrastructure and sustainability.
Valuation Insights: The company scores 2/6 on valuation checks, indicating that much of the positive news may already be priced in, with a current share price slightly undervalued based on a Discounted Cash Flow model.
PE Ratio Analysis: Watts trades at a PE ratio of 28.7, higher than the industry average, suggesting it may be overvalued compared to its tailored Fair Ratio of 22.7, indicating a premium but not excessively so.
Narrative Approach: Investors can create personalized Narratives to assess the company's future value, allowing for diverse perspectives on its worth, with estimates ranging from $250 to $320 per share.
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Analyst Views on WTS
Wall Street analysts forecast WTS stock price to fall
8 Analyst Rating
1 Buy
7 Hold
0 Sell
Hold
Current: 336.180
Low
275.00
Averages
295.83
High
312.00
Current: 336.180
Low
275.00
Averages
295.83
High
312.00
About WTS
Watts Water Technologies, Inc. is a supplier of differentiated solutions, systems and products that manage and conserve the flow of fluids and energy into, through and out of buildings in the commercial and residential markets. The Company's products and solutions include Residential & commercial flow control and protection products that include backflow preventers, water pressure regulators, temperature and pressure relief valves, thermostatic mixing valves, leak detection and others; Heating, ventilation and air conditioning (HVAC) & gas includes commercial high-efficiency boilers, water heaters and custom heat and hot water solutions, hydronic and electric heating systems, hydronic pump groups, and flexible stainless-steel connectors; Drainage & water re-use includes drainage products and engineered rainwater harvesting solutions; and Water quality products include point-of-use and point-of-entry water filtration, monitoring, conditioning and scale prevention systems.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Watts Water Technologies Reports Record Q4 2025 Earnings and Strategic Growth Plans
- Record Performance: Watts Water achieved $625 million in sales for Q4 2025, reflecting a 16% year-over-year increase and an 8% organic sales growth, showcasing the company's strong market performance and enhanced profitability, which is expected to bolster investor confidence.
- Acquisition Strategy: The company completed acquisitions of Superior Boiler and Saudi Cast, contributing approximately $60 million and $20 million in annual sales respectively, with expectations of positive impacts on adjusted EPS in 2026, thereby strengthening its market position.
- Data Center Growth: Sales from the data center sector represented over 3% of total sales in 2025 and are growing at a double-digit rate, indicating that the company's expansion strategy in high-potential markets is yielding results and will drive overall performance growth.
- Outlook: The company projects reported sales growth of 8% to 12% and organic sales growth of 2% to 6% for 2026, while planning to phase out lower-margin channels, aiming to enhance overall profitability and ensure long-term sustainable development.
See More
Watts Water (WTS) Q4 2025 Earnings Call Transcript
See More
Watts Water Technologies Q4 Earnings Beat Expectations
- Earnings Surprise: Watts Water Technologies reported a Q4 non-GAAP EPS of $2.62, exceeding expectations by $0.28, which reflects the company's strong profitability and boosts investor confidence.
- Significant Revenue Growth: The company achieved Q4 revenue of $625 million, representing a 15.7% year-over-year increase and surpassing analyst expectations by $14.49 million, indicating sustained growth in market demand and product sales that further solidifies its market position.
- Market Rating Adjustment: Despite the strong performance, analysts have rated Watts Water Technologies as a 'Hold' due to uncertainties ahead, advising investors to exercise caution in the near term.
- Acquisition Potential Rising: With KeyBanc's positive outlook on the company, Watts Water's stock reached an all-time high, increasing market interest in its acquisition narrative, which could provide new momentum for future growth.
See More
Watts Water Technologies Reports Record Q4 and Full Year 2025 Results
- Record Performance: Watts Water Technologies achieved a net sales of $625.1 million in Q4 2025, a 16% increase year-over-year, with full-year sales reaching $2.4385 billion, an 8% growth, indicating strong demand for water safety and energy efficiency solutions.
- Successful Acquisition Strategy: The company completed acquisitions of Haws Corporation, Superior Boiler, and Saudi Cast during the quarter, enhancing its product portfolio and market access, which is expected to drive growth in non-residential and industrial markets.
- Strong Cash Flow: The full-year free cash flow for 2025 was $356 million, a 7.2% increase from 2024, reflecting effective management in increasing net income and reducing tax burdens, supporting future capital investments and shareholder returns.
- Optimistic Outlook: The company anticipates sales growth of 8% to 12% for 2026, with operating margins expected to rise to between 18.8% and 19.4%, demonstrating confidence in its strategic growth initiatives while navigating global market uncertainties.
See More
Analysis of Tariffs' Impact on the U.S. Economy
- Total Tariffs Paid: Since the implementation of widespread trade tariffs by the Trump administration in 2018, U.S. states have paid a total of $199 billion in tariffs, with California leading at $38 billion, significantly increasing operational costs for small businesses and hindering economic recovery.
- Voter Opposition: Recent polling indicates that 54% of voters oppose Trump's tariff policies, reflecting strong public dissatisfaction with economic burdens, which could exert pressure on the Republican Party in the upcoming midterm elections.
- Small Business Struggles: Many small business owners are facing operational challenges due to tariffs; for instance, Hiblow USA in Michigan incurred $1.2 million in tariff costs, forcing the company to halt expansion plans that would have created 3-4 new jobs.
- Consumer Impact: A toy store owner closed her 44-year-old business due to tariffs that led to price increases and declining sales, illustrating the dual impact of tariffs on consumers and small businesses alike.
See More
Watts Water Technologies Set to Release Q4 Earnings on February 11
- Earnings Announcement: Watts Water Technologies is set to announce its Q4 earnings on February 11, with consensus EPS estimates at $2.34, reflecting a 14.1% year-over-year increase, and revenue estimates at $610.51 million, up 13.1% year-over-year, indicating strong growth potential.
- Consistent Outperformance: Over the past two years, Watts has consistently beaten EPS and revenue estimates 100% of the time, showcasing its financial stability and market confidence, which may enhance investor expectations for future performance.
- Estimate Revision Trends: In the last three months, EPS estimates have seen seven upward revisions and one downward revision, while revenue estimates have experienced six upward revisions with no downward adjustments, reflecting analysts' optimistic outlook on the company's future performance, potentially attracting more investor interest.
- Market Rating Dynamics: Despite Watts Water's stock hitting an all-time high, KeyBanc has maintained a “Hold” rating due to uncertainties in the market, which may influence short-term investment decisions, prompting investors to carefully assess risks and rewards.
See More
Watts Water Technologies Reports Record Q4 2025 Earnings and Strategic Growth Plans
- Record Performance: Watts Water achieved $625 million in sales for Q4 2025, reflecting a 16% year-over-year increase and an 8% organic sales growth, showcasing the company's strong market performance and enhanced profitability, which is expected to bolster investor confidence.
- Acquisition Strategy: The company completed acquisitions of Superior Boiler and Saudi Cast, contributing approximately $60 million and $20 million in annual sales respectively, with expectations of positive impacts on adjusted EPS in 2026, thereby strengthening its market position.
- Data Center Growth: Sales from the data center sector represented over 3% of total sales in 2025 and are growing at a double-digit rate, indicating that the company's expansion strategy in high-potential markets is yielding results and will drive overall performance growth.
- Outlook: The company projects reported sales growth of 8% to 12% and organic sales growth of 2% to 6% for 2026, while planning to phase out lower-margin channels, aiming to enhance overall profitability and ensure long-term sustainable development.
See More
Watts Water (WTS) Q4 2025 Earnings Call Transcript
See More
Watts Water Technologies Q4 Earnings Beat Expectations
- Earnings Surprise: Watts Water Technologies reported a Q4 non-GAAP EPS of $2.62, exceeding expectations by $0.28, which reflects the company's strong profitability and boosts investor confidence.
- Significant Revenue Growth: The company achieved Q4 revenue of $625 million, representing a 15.7% year-over-year increase and surpassing analyst expectations by $14.49 million, indicating sustained growth in market demand and product sales that further solidifies its market position.
- Market Rating Adjustment: Despite the strong performance, analysts have rated Watts Water Technologies as a 'Hold' due to uncertainties ahead, advising investors to exercise caution in the near term.
- Acquisition Potential Rising: With KeyBanc's positive outlook on the company, Watts Water's stock reached an all-time high, increasing market interest in its acquisition narrative, which could provide new momentum for future growth.
See More
Watts Water Technologies Reports Record Q4 and Full Year 2025 Results
- Record Performance: Watts Water Technologies achieved a net sales of $625.1 million in Q4 2025, a 16% increase year-over-year, with full-year sales reaching $2.4385 billion, an 8% growth, indicating strong demand for water safety and energy efficiency solutions.
- Successful Acquisition Strategy: The company completed acquisitions of Haws Corporation, Superior Boiler, and Saudi Cast during the quarter, enhancing its product portfolio and market access, which is expected to drive growth in non-residential and industrial markets.
- Strong Cash Flow: The full-year free cash flow for 2025 was $356 million, a 7.2% increase from 2024, reflecting effective management in increasing net income and reducing tax burdens, supporting future capital investments and shareholder returns.
- Optimistic Outlook: The company anticipates sales growth of 8% to 12% for 2026, with operating margins expected to rise to between 18.8% and 19.4%, demonstrating confidence in its strategic growth initiatives while navigating global market uncertainties.
See More
Analysis of Tariffs' Impact on the U.S. Economy
- Total Tariffs Paid: Since the implementation of widespread trade tariffs by the Trump administration in 2018, U.S. states have paid a total of $199 billion in tariffs, with California leading at $38 billion, significantly increasing operational costs for small businesses and hindering economic recovery.
- Voter Opposition: Recent polling indicates that 54% of voters oppose Trump's tariff policies, reflecting strong public dissatisfaction with economic burdens, which could exert pressure on the Republican Party in the upcoming midterm elections.
- Small Business Struggles: Many small business owners are facing operational challenges due to tariffs; for instance, Hiblow USA in Michigan incurred $1.2 million in tariff costs, forcing the company to halt expansion plans that would have created 3-4 new jobs.
- Consumer Impact: A toy store owner closed her 44-year-old business due to tariffs that led to price increases and declining sales, illustrating the dual impact of tariffs on consumers and small businesses alike.
See More
Watts Water Technologies Set to Release Q4 Earnings on February 11
- Earnings Announcement: Watts Water Technologies is set to announce its Q4 earnings on February 11, with consensus EPS estimates at $2.34, reflecting a 14.1% year-over-year increase, and revenue estimates at $610.51 million, up 13.1% year-over-year, indicating strong growth potential.
- Consistent Outperformance: Over the past two years, Watts has consistently beaten EPS and revenue estimates 100% of the time, showcasing its financial stability and market confidence, which may enhance investor expectations for future performance.
- Estimate Revision Trends: In the last three months, EPS estimates have seen seven upward revisions and one downward revision, while revenue estimates have experienced six upward revisions with no downward adjustments, reflecting analysts' optimistic outlook on the company's future performance, potentially attracting more investor interest.
- Market Rating Dynamics: Despite Watts Water's stock hitting an all-time high, KeyBanc has maintained a “Hold” rating due to uncertainties in the market, which may influence short-term investment decisions, prompting investors to carefully assess risks and rewards.
See More
