Watts Water Technologies, Inc. research snapshot
WTS AI stock analysis currently reads Watts Water Technologies as a high-quality manufacturer of plumbing, heating, and water-quality products with record Q1 2026 results, fast data-center cooling growth, and a premium valuation. At the August 3, 2026 data cutoff, the latest verified price reference was a $345.79 close on July 31, 2026 with a market cap near $11.55 billion. Full-year 2025 sales were about $2.44 billion with free cash flow of about $356 million, and Q1 2026 sales rose 21% to $677.3 million with adjusted EPS of $3.04. The WTS AI stock forecast uses scenarios, not a price promise, and this page is for information only, not investment advice.
Current price
$345.79 close on July 31, 2026
Market cap
$11.55 billion using July 31 market-data references
AI score
72 / 100
Rating
High-quality water-control manufacturer with solid execution, data-center momentum, and a full-premium multiple
Trend status
Medium-term uptrend above the 200-day average, short-term pullback below the early-July highs
Data cutoff (updated monthly)
August 4, 2026
Informational use only. This page is not investment advice.
| Dimension | Conclusion | Confidence |
|---|---|---|
| Business quality | Watts designs and sells products that control the efficiency, safety, and quality of water in residential, commercial, and institutional buildings, with about 60% of sales tied to repair and replacement demand and a fast-growing data-center cooling line. | High |
| Moat | Code and specification requirements, brand trust in safety-critical water control, distributor relationships, installed-base familiarity, and manufacturing scale support the moat. Network effects are limited, and peers still compete on price, channel, and product breadth. | Medium-high |
| Management | CEO Robert J. Pagano Jr. has emphasized the One Watts Performance System, productivity, five 2025 acquisitions, dividend growth, and disciplined buybacks while keeping a net-cash balance sheet. Dual-class Class B stock with 10 votes per share concentrates control with the Pagano family. | Medium-high |
| Financial trend | 2025 sales rose about 8% to $2.439 billion, adjusted operating margin reached about 19.6%, adjusted EPS rose about 19% to $10.58, and free cash flow was about $356 million. Q1 2026 sales rose 21% to $677.3 million with organic growth of 12% and adjusted EPS of $3.04. | High |
| Valuation | At the July 31 price reference, exact arithmetic gives about 31.6x TTM EPS of $10.93, about 5.5x book value near $62.77 per share, about 4.5x TTM sales near $2.56 billion, about 36.4x TTM free cash flow near $317 million, and about 0.73% dividend yield on $2.52. | Medium-high |
| Technical trend | The $345.79 July 31 close sat above the 50-day average near $337.94 and above the 200-day average near $303.96, inside a 52-week range of $251.17 to $394.54, after a pullback from the June 30 high near $394.54. | Medium |
| Risk level | Risks include housing and non-residential construction cycles, Middle East conflict impact on about 2% of global sales, tariffs and trade policy, Europe demand softness, acquisition integration, dual-class voting control, product liability, commodity inflation, and multiple compression if growth slows. | Medium-high |
| AI confidence | Reported financial and share-count confidence is high, but near-term price path and the correct long-term earnings multiple remain uncertain. | High data confidence |
| Investment certainty | Medium certainty: Watts is a quality compounder with real operating advantages and data-center momentum, but the stock already embeds a premium multiple, so valuation and cycle timing still decide attractiveness. | Medium |
WTS AI stock forecast
The WTS AI stock forecast uses the $345.79 July 31 reference, $10.93 TTM EPS, and a three-year scenario model calculated with Pineify financial_rigor.py. The model is a sensitivity exercise, not a target or investment recommendation.
$500 to $545 over 3 years
More likely if sales compound near the high end of the reported 8% to 12% growth outlook, data-center and higher-value product mix keep expanding margins, free cash flow stays strong, and investors accept an earnings multiple near 34x.
$360 to $400 over 3 years
More likely if EPS compounds near 7%, organic growth stays in the low-to-mid single digits after acquisition and FX noise, margins hold near the guided band, and the market values WTS near 28x earnings.
$195 to $235 over 3 years
More likely if construction demand weakens, Europe softens further, the Middle East conflict or tariffs pressure costs, organic growth slows toward 2% or lower, or the multiple falls toward 20x earnings.
WTS AI technical analysis
WTS AI technical analysis at the August 3, 2026 cutoff shows a medium-term uptrend that remains intact above the 200-day average after a multi-week pullback from the June 30 high. Market data referenced a $345.79 July 31 close, a 50-day average near $337.94, a 200-day average near $303.96, and an RSI near 50.8 that is neutral after cooling from overbought June levels.
| Level | Value | Why it matters |
|---|---|---|
| Current price | $345.79 close on July 31, 2026 | Latest verified price reference used in the valuation and market-cap checks. |
| Near support | $334 to $338 | The late-July swing lows around the 50-day average formed the first pullback floor after the June peak. |
| Deeper support | $310 to $320 | The June consolidation zone is the next reference if the near support band fails. |
| 200-day support | $300 to $305 | The 200-day average near $303.96 is the medium-term trend line for the advance. |
| Near resistance | $353 to $360 | The mid-July highs near $359 are the first reclaim test for short-term bulls. |
| Upper resistance | $368 to $375 | The early-July breakdown zone marks the next supply area above the current close. |
| Major resistance | $391 to $394.54 | The 52-week high near $394.54 set on June 30, 2026 is the upper range reference. |
| 50-day moving average | About $337.94 | Price was above this average on the July 31 reference, so the short-term trend is stabilizing. |
| 200-day moving average | About $303.96 | Holding above this average keeps the medium-term uptrend framework intact. |
| Momentum | RSI near 50.8 on the reference data set | Momentum cooled from overbought June readings and is neutral rather than extended. |
| Volume and volatility | Average daily volume roughly 200,000 to 210,000 shares | Watch volume around the August 5, 2026 earnings date, tariff headlines, Middle East news, and housing data. |
| Invalidation | Sustained close below $334 to $338 | A break under the 50-day zone would weaken the short-term setup, with the 200-day near $304 as the deeper risk line. |
WTS AI trading strategy
The WTS AI trading strategy is a non-personalized research framework. It pairs chart confirmation with organic sales, price and productivity, data-center exposure, free cash flow, Middle East impact, tariffs, acquisition contribution, and construction demand rather than relying on one price level.
Look for WTS to reclaim and hold the $353 to $360 zone with improving volume while organic growth, adjusted operating margin, and free-cash-flow conversion remain consistent with management guidance.
Invalidate if price loses the $334 to $338 band on sustained weakness or if quarterly data show a sharp organic slowdown, margin miss, or working-capital drag that hurts cash conversion.
If WTS pulls back toward the $334 to $338 area while the full-year outlook and balance-sheet strength remain intact, compare the rebound with housing data, industrial peers, data-center momentum, and tariff and Middle East news, not price alone.
Do not assume a lower price is value if organic growth stalls, Europe weakens further, or the Middle East conflict, tariffs, and acquisition dilution erase margin gains.
Track reported and organic sales by region, data-center related volume, adjusted operating margin, free cash flow conversion, inventory and receivables, dividend and buyback actions, and Class A versus Class B ownership signals.
Reduce conviction if growth falls below the guided organic range while tariffs, Middle East demand, Europe softness, or integration costs compress returns on capital.
Investment research summary
Customers pay Watts for products that keep water systems safer, cleaner, more efficient, and code compliant inside buildings, with about 60% of demand coming from repair and replacement. The core economic engine is a mix of specification-driven products, distributor relationships, pricing power on differentiated SKUs, productivity, selective bolt-on acquisitions, and a new data-center cooling growth line.
The moat rests on brand trust in safety-critical applications, code and specification barriers, channel relationships, manufacturing and distribution scale, and an installed base that favors familiar parts and systems. It is a durable industrial moat, not a winner-take-all network moat.
The thesis can fail if housing and commercial construction weaken, Europe stays soft, the Middle East conflict or tariffs outrun pricing, acquisitions dilute returns, product-liability or quality issues appear, dual-class control leads to poor capital allocation, or a 30x-plus multiple compresses when growth normalizes.
Robert J. Pagano Jr. has run a multi-year productivity and portfolio program with margin expansion, free-cash-flow conversion near or above 90% of net income, a 21% higher dividend, and limited leverage. Dual-class Class B stock with 10 votes per share means control is concentrated, so minority investors need comfort with governance as much as with operations.
Water safety, efficiency, building code upgrades, and specialized demand such as data-center cooling are multi-year demand supports. Management calls data centers a more than $1 billion addressable market and said data-center sales more than doubled in Q1 2026. The industry is still cyclical through construction, renovation, and industrial investment, so the secular story does not remove downturn risk.
The three-scenario model produced roughly $522, $375, and $206 in bullish, base, and bearish cases. That spread shows why business quality alone is not a margin of safety at about 32x TTM earnings: organic growth durability, margin quality, data-center execution, and the exit multiple matter as much as recent beat-and-raise optics.
Source-backed data
Every metric below includes a source and last verification date.
| Metric | Value | Source | Last verified |
|---|---|---|---|
| WTS price and market-cap references | $345.79 close on July 31, 2026; market cap about $11.55 billion; 52-week range $251.17 to $394.54 | StockAnalysis WTS overview and statistics pages | August 3, 2026 |
| Market-cap arithmetic | $11.55 billion calculated from $345.79 x 33,394,931 Class A and Class B shares outstanding; 0.02% variance versus the $11.55 billion reported market-cap reference | Pineify financial_rigor.py using company share counts and market data | August 3, 2026 |
| Share structure | Class A 27,478,641 shares at 1 vote each and Class B 5,916,290 shares at 10 votes each as of March 29, 2026; total shares about 33.39 million | Watts Q1 2026 balance sheet and StockAnalysis share statistics | August 3, 2026 |
| FY2025 sales, earnings, and free cash flow | Sales about $2.439 billion (+8%), net income about $340.8 million (+17%), EPS about $10.17, free cash flow about $356.3 million, and free-cash-flow conversion near or above 90% of net income | Watts 2025 Annual Report and StockAnalysis financials | August 3, 2026 |
| Q1 2026 operating results | Net sales $677.3 million (+21% reported, +12% organic), adjusted operating margin 20.1%, adjusted EBITDA $151 million (22.3% margin), adjusted EPS $3.04 (+28%), GAAP diluted EPS $2.97, free cash flow about $7 million after working-capital investment | Watts Q1 2026 earnings release and earnings call transcript | August 3, 2026 |
| TTM financials through Q1 2026 | TTM revenue about $2.558 billion (+14%), TTM net income about $366.4 million, TTM EPS $10.93, TTM free cash flow about $317.3 million, and TTM gross margin near 49% | StockAnalysis WTS financials and statistics | August 3, 2026 |
| Balance sheet cash and debt | Cash and cash equivalents $374.7 million, long-term debt $197.8 million, net cash about $176.9 million, and book value about $62.77 per share at March 29, 2026 | Watts Q1 2026 balance sheet and StockAnalysis | August 3, 2026 |
| Valuation arithmetic | About 31.6x TTM EPS of $10.93, about 5.5x book value near $62.77, about 4.5x TTM sales near $2.56 billion, about 36.4x TTM free cash flow near $317 million, EV/EBITDA about 20.8x, and about 0.73% dividend yield on $2.52 annualized | Pineify financial_rigor.py using market and company inputs | August 3, 2026 |
| 2026 outlook and capital returns | Full-year 2026 sales growth guidance maintained at 8% to 12% reported and 2% to 6% organic; Q2 2026 reported growth guided at 10% to 14% with organic growth of 4% to 8%; quarterly dividend raised 21% to $0.63 beginning June 2026; 13 years of dividend growth | Watts Q1 2026 earnings call transcript and StockAnalysis dividend data | August 3, 2026 |
| Analyst consensus | Hold rating from 12 analysts with an average price target of $358.33, a low of $320, a median of $350, and a high of $414; recent actions include Stifel at $403 (Buy), Barclays at $414 (Overweight), KeyBanc at $380 (Overweight), RBC at $350, and TD Cowen at $320 | StockAnalysis forecast page and TipRanks | August 3, 2026 |
| Technical reference band | 50-day average near $337.94, 200-day average near $303.96, RSI near 50.8, 20-day average volume near 204,000 shares, and beta about 1.13 | StockAnalysis WTS statistics | August 3, 2026 |
| Data-center and Middle East context | Data-center sales more than doubled in Q1 2026 against a more than $1 billion addressable market, with high double-digit growth targeted for 2026; direct Middle East exposure is about 2% of global sales, with roughly an $8 million Q2 sales headwind and a $5 million to $6 million margin headwind | Watts Q1 2026 earnings call transcript | August 3, 2026 |
This WTS AI stock analysis page is an information tool only and is not investment advice, a recommendation, or a solicitation to buy or sell any security. Forecast ranges are scenario estimates based on publicly available data as of the stated cutoff and can be wrong. Always verify current prices, filings, and risk tolerance before making investment decisions.
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