Free cash flow surged 62% year-over-year to $203.2M in 2027Q1, with operating cash flow at 1.55x net income, though working capital swings and the acquisition caused negative FCF in 2026Q4.
Advanced Drainage Systems, Inc. (WMS) cash flow statement — 15-year operating, investing & financing cash flows
| Metric | TTM | Mar'26 | Mar'25 | Mar'24 | Mar'23 | Mar'22 | Mar'21 | Mar'20 | Mar'19 | Mar'18 | Mar'17 | Mar'16 | Mar'15 | Mar'14 | Mar'13 | Mar'12 |
|---|
| Cash from Operations | 767.46M | 819.05M | 581.49M | 717.93M | 707.81M | 274.89M | 452.22M | 306.19M | 151.68M | 137.12M | 104.24M | 134.76M | 68.58M | 62.12M | 75.35M | 57M |
| Operating CF Margin % | - | 26.85% | 20.02% | 24.98% | 23.05% | 9.93% | 22.81% | 18.29% | 10.95% | 10.31% | 8.29% | 10.45% | 5.82% | 5.81% | 7.41% | 5.62% |
| Operating CF Growth % | 17.55% | 40.85% | -19% | 1.43% | 157.49% | -39.21% | 47.69% | 101.87% | 10.62% | 31.54% | -22.65% | 96.51% | 10.39% | -17.56% | 32.21% | - |
| Net Income | 405.49M | 489.16M | 452.57M | 513.29M | 511.35M | 275.03M | 226.09M | -191.8M | 81.47M | 64.79M | 35.91M | 30.57M | -3.7M | 11.32M | 23.18M | 44.43M |
| Depreciation & Amortization | 237.18M | 216.26M | 183.28M | 154.9M | 145.15M | 141.81M | 145.59M | 124.94M | 71.9M | 75M | 72.36M | 71.01M | 65.47M | 63.67M | 63.1M | 55.17M |
| Stock-Based Compensation | 39.9M | 32.35M | 26.58M | 31.99M | 21.66M | 107.99M | 65.43M | 279.15M | 21.83M | 18.84M | 17.88M | 4.38M | 37.4M | 35.03M | 9.36M | 6.38M |
| Deferred Taxes | 29.54M | 35.38M | -423K | -2.28M | -9.86M | 2.17M | -13.48M | -2.92M | 12.81M | -11.24M | -8.97M | 10.69M | -18.76M | -8.26M | -7.15M | -5.56M |
| Other Non-Cash Items | 77.45M | -35.27M | 1.65M | -6.13M | 6.13M | -10.88M | 7.87M | 42.91M | 1.6M | 12.09M | -4.37M | 17.35M | 10.79M | 6.63M | 177K | -36.61M |
| Working Capital Changes | -25.81M | 81.17M | -82.17M | 26.16M | 33.38M | -241.24M | 20.71M | 53.91M | -37.93M | -22.38M | -8.56M | 1.34M | -16.83M | -36M | -13.32M | -6.82M |
| Change in Receivables | 24.82M | -2.29M | 1.41M | -14.59M | 37.49M | -96.99M | -34.76M | 5.17M | -17.95M | -4.33M | 15.05M | -37.79M | -10.35M | -6.72M | 24.75M | -29.66M |
| Change in Inventory | -74.67M | 30.61M | -15.75M | 594K | 30.22M | -189.72M | -14.56M | 19.09M | -2.03M | -4.84M | -27.92M | 28.33M | -7.56M | -33.1M | -32.16M | 13.72M |
| Change in Payables | 29.45M | 53.96M | -63.86M | 40.43M | -29.04M | 50.11M | 71.24M | 31.59M | -16.94M | -14.86M | 6.85M | 0 | -18.86M | 7.29M | 0 | 11.77M |
| Cash from Investing | -1.2B | -1.21B | -447.87M | -155.66M | -214.48M | -198.83M | -77.87M | -1.15B | -42.54M | -30.45M | -61.26M | -48.96M | -80.49M | -41.77M | -44.8M | -35.83M |
| Capital Expenditures | -237.51M | -249.77M | -212.94M | -183.81M | -166.91M | -149.08M | -78.76M | -67.68M | -43.41M | -41.71M | -51.3M | -44.89M | -36.1M | -43.6M | -39.84M | -29.86M |
| CapEx % of Revenue | 7.28% | 8.19% | 7.33% | 6.39% | 5.43% | 5.38% | 3.97% | 4.04% | 3.14% | 3.14% | 4.08% | 3.48% | 3.07% | 4.08% | 3.92% | 2.95% |
| Acquisitions | -972.51M | -991.06M | -237.31M | 0 | -48.01M | -49.31M | 0 | -1.09B | 0 | 0 | -8.57M | -3.19M | -43.95M | -6.38M | -5.04M | -47.73M |
| Investments | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
| Other Investing | 6.3M | 29.01M | 2.39M | 28.15M | 446K | -441K | 883K | 6.53M | 868K | 11.26M | -48.07M | -888K | -62K | 8.6M | 78K | 41.76M |
| Cash from Financing | -220.7M | 156.32M | -157.73M | -284.34M | -296.28M | -251.07M | -354.58M | 1.01B | -117.66M | -94.95M | -42.83M | -84.05M | 12.06M | -17.71M | -31.34M | -21.23M |
| Debt Issued (Net) | 307.25M | 303.23M | -37.38M | -26.88M | 358.48M | 88.1M | -328.49M | 836.73M | -87.32M | -72.92M | -29.03M | -68.46M | -63.43M | 91.86M | -30.02M | -4.07M |
| Equity Issued (Net) | -456.08M | -85.11M | -69.92M | -207.31M | -575.03M | -292M | 7.55M | 293.65M | 0 | -7.95M | 0 | 0 | 79.13M | -5.49M | -3.28M | -4.24M |
| Dividends Paid | -58.55M | -56.12M | -49.74M | -43.99M | -39.61M | -37.02M | -30.68M | -92.13M | -26.15M | -18.48M | -16.82M | -16.24M | -4.8M | -112.75M | -6.16M | -4.93M |
| Share Repurchases | -464.87M | -91.96M | -69.92M | -207.31M | -575.03M | -292M | 0 | 0 | 0 | -7.95M | 0 | 0 | -3K | -5.49M | -3.28M | -4.24M |
| Other Financing | -13.32M | -5.68M | -684K | -6.16M | -40.12M | -10.15M | -2.96M | -26.68M | -4.18M | 4.39M | -3.79M | 1.74M | -6.04M | -2.42M | 8.12M | -7.99M |
| Net Change in Cash | -656.9M | -235.3M | -26.58M | 278.72M | 197M | -174.88M | 20.78M | 165.34M | -8.7M | 11.14M | -105K | 869K | -308K | 2.57M | -721K | -69K |
| Free Cash Flow | 529.95M | 569.29M | 368.55M | 534.12M | 540.9M | 125.81M | 373.46M | 238.51M | 108.27M | 95.41M | 52.94M | 89.87M | 32.47M | 18.52M | 35.52M | 27.13M |
| FCF Margin % | 16.25% | 18.66% | 12.69% | 18.58% | 17.61% | 4.54% | 18.84% | 14.25% | 7.82% | 7.17% | 4.21% | 6.97% | 2.76% | 1.73% | 3.49% | 2.68% |
| FCF Growth % | 0.14% | 54.47% | -31% | -1.25% | 329.95% | -66.31% | 56.58% | 120.3% | 13.47% | 80.21% | -41.09% | 176.76% | 75.3% | -47.85% | 30.9% | - |
| FCF per Share | 6.99 | 7.25 | 4.71 | 6.76 | 6.49 | 1.73 | 5.22 | 3.74 | 1.88 | 1.69 | 0.95 | 1.46 | 0.62 | 0.33 | 0.65 | 0.49 |
| FCF Conversion (FCF/Net Income) | 1.31x | 1.92x | 1.29x | 1.41x | 1.40x | 1.01x | 2.02x | -1.59x | 1.95x | 2.21x | 3.16x | 6.53x | 2.61x | 5.58x | 3.65x | 1.32x |
| Interest Paid | 9.67M | 87.03M | 89.48M | 86.26M | 60.46M | 32.84M | 37.61M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Taxes Paid | 29.94M | 113.35M | 142.15M | 161.15M | 166.96M | 106.36M | 97.64M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
Quick answers to the most common questions about buying WMS stock.
Advanced Drainage Systems, Inc. (WMS) generated $819.1M in net cash from operating activities in 2026. This reflects the cash generated directly from core business operations.
Advanced Drainage Systems, Inc. (WMS) generated $569.3M in free cash flow in 2026. Free cash flow is the cash left over after capital expenditures, which can be used to pay dividends, repurchase shares, or pay down debt.
Advanced Drainage Systems, Inc. (WMS) spent $249.8M on capital expenditures in 2026. CapEx represents the cash invested in physical assets like property, plant, and equipment to maintain or grow the business.
In 2026, Advanced Drainage Systems, Inc. (WMS) returned $56.1M to shareholders via cash dividends and spent $92.0M on share repurchases. This shows the company's commitment to returning capital to its equity investors.
Key Metrics
Top Statement Risk
Working capital volatility and cyclicality
Metrics are mathematically derived from official filings.
Cash Conversion Strength Persists
WMS's operating cash flow exceeded net income in most quarters, with OCF/NI averaging 1.5x over the last year, indicating high earnings quality, per recent financial statements.
The consistent OCF/NI ratio above 1.0, except in seasonally weak quarters, suggests that reported earnings are well-backed by cash generation. The gap between net income and operating cash flow is primarily driven by non-cash D&A and favorable working capital swings, which appear to be sustainable given the company's capital-intensive manufacturing model.
FCF Rebound Signals Momentum
Free cash flow surged to $203.2M in 2027Q1, a 62% increase from the prior year quarter, with FCF margin expanding to 20.3%, as reported in the latest quarterly filing.
The sharp rebound in FCF from negative territory in 2026Q4 underscores the seasonal and cyclical nature of the business, but the 2027Q1 performance indicates strong operating leverage. FCF margins have consistently exceeded 14% in the last four quarters, suggesting that the company is converting revenue growth into cash at an accelerating pace.
Capital Intensity Remains Moderate
Capital expenditures averaged 7.6% of revenue over the past year, with a slight uptick to 12.4% in 2026Q3, reflecting investment in capacity, according to reported figures.
The capex-to-revenue ratio is relatively stable, indicating a balanced approach between maintenance and growth spending. The elevated capex in 2026Q3 may signal expansion initiatives, but the subsequent quarters show a return to normal levels, suggesting management is disciplined in capital allocation.
Working Capital Swings Drive Cash Flow
Working capital changes swung from -$127.8M in 2024Q4 to +$104.8M in 2026Q3, highlighting significant quarter-to-quarter volatility, as per the cash flow statement.
The large negative working capital changes in fiscal year-end quarters (2024Q4, 2025Q4, 2026Q4) suggest a seasonal build-up of receivables and inventory, which then reverses in subsequent quarters. This pattern is typical for construction-related businesses and appears to be a key driver of quarterly cash flow variability, but it does not seem to indicate a structural deterioration in working capital efficiency.
Shareholder Returns Accelerate
WMS deployed $233.2M in buybacks in 2027Q1, a significant increase from prior quarters, while dividends remained steady, based on the latest cash flow data.
The aggressive buyback activity in 2027Q1, coupled with consistent dividend payments, suggests management is confident in the company's cash generation and is returning excess capital to shareholders. This deployment is supported by robust operating cash flow, but investors should monitor whether such buyback levels are sustainable given the cyclicality of the business.
Cumulative Cash Outpaces Earnings
Over the last ten quarters, cumulative operating cash flow of $1.68B exceeded cumulative net income of $1.14B, indicating strong cash conversion, as reported in financial statements.
The cumulative excess of operating cash flow over net income suggests that earnings are of high quality and that the company is not relying on aggressive accruals. This divergence is partly due to non-cash D&A and favorable working capital management, which appears to be a structural advantage for WMS in its capital-intensive industry.
What Could Invalidate the Base Case
Despite robust cash generation, the 2026Q4 acquisition of $972.5M and negative FCF of -$13.1M highlight potential cash flow distortions, as per the cash flow statement.
The large acquisition in 2026Q4 significantly impacted cash flow, and the negative FCF in that quarter suggests that growth initiatives may strain liquidity in the near term. Additionally, the low effective tax rate in 2027Q1, as noted in the income statement, could inflate reported earnings, warranting scrutiny of one-time items. Investors should monitor whether the company can sustain its cash generation while integrating acquisitions and managing working capital volatility.