Overview

* A. O. Smith ( AOS ) Q3 revenue grows 4% but misses analyst expectations

* EPS for Q3 increased 15% to $0.94

* Company updates full-year sales outlook to flat to 1% growth

Outlook

* Company projects full-year sales to be flat to up 1%

* A. O. Smith ( AOS ) narrows full-year EPS forecast to $3.70-$3.85

* Company cautious due to China market challenges and weakening new home construction

Result Drivers

* NORTH AMERICA SALES - Sales in North America grew 6% driven by pricing actions and demand for commercial water heaters and boilers

* CHINA SALES DECLINE - China experienced a 12% local currency sales decline due to economic challenges

* OPERATING MARGIN IMPROVEMENT - Operating margin in North America expanded by 110 basis points due to pricing actions and higher volumes

Key Details

Metric Beat/Mis Actual Consensu

s s

Estimate

Q3 Miss $942.50 $946.54

Revenue mln mln (13

Analysts

)

Q3 EPS $0.94

Q3 Net $132 mln

Income

Analyst Coverage

* The current average analyst rating on the shares is "hold" and the breakdown of recommendations is 5 "strong buy" or "buy", 10 "hold" and 1 "sell" or "strong sell"

* The average consensus recommendation for the electrical components & equipment peer group is "buy."

* Wall Street's median 12-month price target for A O Smith Corp ( AOS ) is $80.00, about 14.2% above its October 27 closing price of $68.61

* The stock recently traded at 17 times the next 12-month earnings vs. a P/E of 17 three months ago

Press Release:

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)