Latest Ratios: P/E Ratio 35.1x · EV/EBITDA 22.2x · ROE 18.2%. (1996–2025 historical series)
Price-based multiples — how expensive the stock is relative to earnings, sales, book value, and cash flow
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Market Cap | $11.9B | $9.2B | $6.8B | $7.0B | $4.9B | $6.6B | $4.1B | $3.4B | $2.2B | $2.6B | $2.2B |
| Enterprise Value | $11.7B | $9.0B | $6.6B | $6.9B | $4.8B | $6.5B | $4.1B | $3.5B | $2.4B | $2.8B | $2.6B |
| P/E Ratio → | 35.13 | 27.14 | 23.39 | 26.64 | 19.52 | 39.71 | 36.22 | 25.91 | 17.73 | 35.83 | 26.72 |
| P/S Ratio | 4.89 | 3.79 | 3.02 | 3.39 | 2.48 | 3.64 | 2.74 | 2.13 | 1.41 | 1.79 | 1.61 |
| P/B Ratio | 5.90 | 4.56 | 3.99 | 4.61 | 3.78 | 5.61 | 3.87 | 3.49 | 2.49 | 3.15 | 3.06 |
| P/FCF | 33.48 | 25.95 | 20.90 | 24.83 | 25.08 | 42.71 | 22.37 | 20.70 | 16.67 | 20.90 | 22.03 |
| P/OCF | 29.68 | 23.00 | 18.86 | 22.46 | 21.93 | 36.41 | 18.08 | 17.59 | 13.07 | 16.76 | 16.29 |
P/E links to full P/E history page with 30-year chart
Enterprise-value multiples — capital-structure-neutral measures of total business value
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| EV / Revenue | — | 3.71 | 2.94 | 3.37 | 2.40 | 3.58 | 2.73 | 2.19 | 1.51 | 1.94 | 1.83 |
| EV / EBITDA | 22.18 | 17.10 | 14.88 | 17.57 | 13.39 | 22.77 | 18.09 | 14.37 | 9.97 | 13.19 | 13.06 |
| EV / EBIT | 24.85 | 19.80 | 16.52 | 19.37 | 15.10 | 26.96 | 22.83 | 17.68 | 12.38 | 17.45 | 17.03 |
| EV / FCF | — | 25.37 | 20.32 | 24.64 | 24.25 | 42.07 | 22.25 | 21.25 | 17.79 | 22.64 | 25.09 |
Margins and return-on-capital ratios measuring operating efficiency
Full margin charts and quarterly trend are on the Earnings History page
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Gross Margin | 49.5% | 49.5% | 47.2% | 46.7% | 44.2% | 42.4% | 41.5% | 42.3% | 42.0% | 41.4% | 40.4% |
| Operating Margin | 19.3% | 19.3% | 17.3% | 17.1% | 15.9% | 13.2% | 12.0% | 12.3% | 12.0% | 11.1% | 10.4% |
| Net Profit Margin | 14.0% | 14.0% | 12.9% | 12.7% | 12.7% | 9.2% | 7.6% | 8.2% | 8.0% | 5.0% | 6.0% |
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| ROE | 18.2% | 18.2% | 18.1% | 18.6% | 20.3% | 14.8% | 11.2% | 14.1% | 14.5% | 9.4% | 11.7% |
| ROA | 12.9% | 12.9% | 12.4% | 12.4% | 13.3% | 9.2% | 6.6% | 7.8% | 7.4% | 4.1% | 4.8% |
| ROIC | 21.2% | 21.2% | 19.7% | 20.3% | 21.4% | 16.9% | 12.8% | 14.0% | 13.6% | 11.6% | 10.7% |
| ROCE | 21.7% | 21.7% | 20.1% | 20.3% | 21.0% | 16.7% | 13.3% | 15.1% | 13.9% | 11.7% | 10.5% |
Solvency and debt-coverage ratios — lower is generally safer
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Debt / Equity | 0.10 | 0.10 | 0.12 | 0.20 | 0.11 | 0.12 | 0.19 | 0.32 | 0.40 | 0.60 | 0.89 |
| Debt / EBITDA | 0.37 | 0.37 | 0.44 | 0.76 | 0.42 | 0.50 | 0.87 | 1.27 | 1.49 | 2.32 | 3.31 |
| Net Debt / Equity | — | -0.10 | -0.11 | -0.03 | -0.13 | -0.09 | -0.02 | 0.09 | 0.17 | 0.26 | 0.43 |
| Net Debt / EBITDA | -0.39 | -0.39 | -0.43 | -0.13 | -0.46 | -0.35 | -0.09 | 0.37 | 0.63 | 1.01 | 1.59 |
| Debt / FCF | — | -0.58 | -0.58 | -0.18 | -0.83 | -0.65 | -0.11 | 0.54 | 1.12 | 1.74 | 3.06 |
| Interest Coverage | 42.28 | 42.28 | 27.26 | 43.62 | 44.94 | 38.16 | 13.56 | 14.04 | 11.71 | 8.49 | 6.65 |
Net cash position: cash ($406M) exceeds total debt ($198M)
Short-term solvency ratios and asset-utilisation metrics
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Current Ratio | 2.51 | 2.51 | 2.59 | 2.61 | 2.51 | 2.11 | 2.27 | 1.75 | 2.07 | 2.39 | 2.02 |
| Quick Ratio | 1.49 | 1.49 | 1.65 | 1.63 | 1.52 | 1.20 | 1.43 | 1.11 | 1.25 | 1.60 | 1.45 |
| Cash Ratio | 0.79 | 0.79 | 0.93 | 0.86 | 0.82 | 0.59 | 0.70 | 0.52 | 0.59 | 0.86 | 0.80 |
| Asset Turnover | — | 0.85 | 0.94 | 0.89 | 1.03 | 0.97 | 0.87 | 0.93 | 0.95 | 0.84 | 0.78 |
| Inventory Turnover | 2.35 | 2.35 | 3.04 | 2.74 | 2.94 | 2.81 | 3.35 | 3.42 | 3.17 | 3.30 | 3.48 |
| Days Sales Outstanding | — | 44.01 | 41.03 | 46.12 | 43.11 | 44.57 | 47.81 | 50.13 | 47.93 | 54.15 | 51.68 |
Earnings, FCF, buyback, and dividend yields — total returns to shareholders
Full dividend history and growth charts are on the Dividend History page
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Dividend Yield | 0.6% | 0.7% | 0.8% | 0.7% | 0.8% | 0.5% | 0.8% | 0.9% | 1.3% | 1.0% | 1.1% |
| Payout Ratio | 19.6% | 19.6% | 19.1% | 17.7% | 15.7% | 20.7% | 27.5% | 23.9% | 22.7% | 35.4% | 29.1% |
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings Yield | 2.8% | 3.7% | 4.3% | 3.8% | 5.1% | 2.5% | 2.8% | 3.9% | 5.6% | 2.8% | 3.7% |
| FCF Yield | 3.0% | 3.9% | 4.8% | 4.0% | 4.0% | 2.3% | 4.5% | 4.8% | 6.0% | 4.8% | 4.5% |
| Buyback Yield | 0.1% | 0.2% | 0.2% | 0.2% | 1.4% | 0.2% | 0.7% | 0.6% | 1.2% | 0.7% | 1.2% |
| Total Shareholder Yield | 0.7% | 0.9% | 1.1% | 0.9% | 2.2% | 0.8% | 1.5% | 1.5% | 2.5% | 1.7% | 2.3% |
| Shares Outstanding | — | $34M | $34M | $34M | $34M | $34M | $34M | $34M | $34M | $34M | $35M |
Includes 30+ ratios · 30 years · Updated daily
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Quick answers to the most common questions about buying WTS stock.
Watts Water Technologies, Inc.'s current P/E ratio is 35.1x. The historical average is 24.2x. This places it at the 79th percentile of its historical range.
Watts Water Technologies, Inc.'s current EV/EBITDA is 22.2x. This enterprise value multiple compares the company's total value (equity + debt - cash) to its EBITDA. The historical average is 10.9x.
Watts Water Technologies, Inc.'s return on equity (ROE) is 18.2%. The historical average is 9.6%.
Based on historical data, Watts Water Technologies, Inc. is trading at a P/E of 35.1x. This is at the 79th percentile of its historical P/E range. Compare with industry peers and growth rates for a complete picture.
Watts Water Technologies, Inc.'s current dividend yield is 0.56% with a payout ratio of 19.6%.
Watts Water Technologies, Inc. has 49.5% gross margin and 19.3% operating margin. Operating margin between 10-20% is typical for established companies.
Watts Water Technologies, Inc.'s Debt/EBITDA ratio is 0.4x, indicating low leverage. A ratio below 2x is generally considered financially healthy.
Key Metrics
Top Statement Risk
Goodwill impairment risk
Metrics are mathematically derived from official filings.
Margin Expansion Drives Profitability
Gross margin improved to 49.0% in 2026Q2 from 47.7% in 2024Q2, while operating margin expanded to 20.2%, as reported in financial statements, indicating strong pricing power and cost discipline.
The sequential and year-over-year margin expansion, with operating margin rising from 16.5% in 2024Q4 to 20.2% in 2026Q2, suggests that WTS is benefiting from operational leverage and favorable product mix. Net margin also improved to 15.5% in 2026Q2, up from 12.5% in 2024Q4, reflecting efficient cost control and higher revenue conversion. This profitability trend outpaces the peer group, where net margins average around 12%, indicating a competitive advantage that may be sustainable if demand remains robust.
ROIC Recovery Signals Efficiency Gains
ROIC improved to 6.0% in 2026Q2 from 4.3% in 2024Q4, as per reported figures, indicating that the company is generating higher returns on invested capital, driven by margin expansion and asset efficiency.
The upward trend in ROIC, from 4.3% in 2024Q4 to 6.0% in 2026Q2, suggests that WTS is becoming more effective at deploying capital, likely due to improved margins and disciplined capital allocation. However, ROIC remains below the peer average of approximately 15%, which may indicate that the company's acquisition-led growth has yet to fully yield returns. Investors should monitor whether ROIC can continue to converge toward peer levels as integration benefits materialize.
Working Capital Swings Mask Efficiency
Cash conversion cycle lengthened to 130 days in 2026Q2 from 124 days in 2024Q1, as reported in financial statements, driven by higher inventory days, indicating potential inefficiencies in inventory management.
The CCC has remained elevated, with DIO increasing from 123 days in 2024Q1 to 127 days in 2026Q2, while DSO and DPO have been relatively stable. This suggests that WTS is holding more inventory, which may be a strategic response to supply chain uncertainties or a sign of slowing demand. The working capital swings, as highlighted in the cash flow analysis, indicate that cash conversion is volatile, and investors should watch for any sustained deterioration in inventory turnover.
Deleveraging Strengthens Balance Sheet
Debt-to-equity fell to 0.05 in 2026Q2 from 0.18 in 2024Q1, while interest coverage improved to 69.9x, as per SEC filings, indicating a significantly de-risked balance sheet.
The dramatic reduction in leverage, with total debt declining from $283.5M to $108.0M over the past ten quarters, has substantially improved interest coverage from 23.7x to 69.9x. This provides WTS with ample financial flexibility for future acquisitions or capital returns. The low D/EBITDA of 0.58x suggests that the company could comfortably take on additional debt if needed, but the current conservative stance may reflect a preference for organic growth and shareholder returns.
Ample Liquidity Supports Flexibility
Current ratio improved to 2.66 in 2026Q2 from 2.48 in 2024Q1, with cash of $347.9M, as reported in financial statements, indicating a strong liquidity position to weather operational volatility.
The current ratio has consistently remained above 2.5, and the quick ratio of 1.60 in 2026Q2 suggests that WTS can cover short-term obligations even without selling inventory. The substantial cash balance, combined with minimal debt, provides a cushion against potential working capital swings or economic downturns. This liquidity strength supports the company's ability to fund acquisitions and maintain dividend payments, though the low dividend yield of 0.5% may limit income-focused investor appeal.
Misapplied P/E Overstates Value
The trailing P/E of 37.77 is misleading for WTS due to its low capital intensity and high cash conversion, as per reported figures, suggesting that EV/EBITDA or P/FCF may be more appropriate.
WTS's P/E appears elevated relative to peers, but this is partly because the company has minimal debt and substantial cash, which reduces the equity value relative to enterprise value. The EV/EBITDA of 23.87 is more comparable to peers, though still at a premium, reflecting the company's strong margins and growth prospects. Additionally, the P/FCF of 36.00 indicates that the market is pricing in significant future cash flow growth, which may be justified given the robust FCF margins. Investors should focus on EV-based multiples and cash flow metrics rather than P/E alone to avoid overstating the valuation.