MODEL VERDICT
A. O. Smith Corporation (AOS)
Relative Valuation•Peer multiples, Monte Carlo simulation & quality-adjusted fair value
Popular:
Composite score derived from valuation, quality, and risk factors
Quantitative model thresholds · For educational and research purposes only
Each row records the model's monthly assessment. High Conviction = the model detected notable undervaluation vs peers. Neutral = no notable divergence was found. The return column shows the actual price change over 90 days for reference. This is a quantitative observation log — not investment advice.
| Date | Assessment | Score | Price | Status | 90d Fwd Return |
|---|---|---|---|---|---|
| May 1, 2026 | MODERATE | 0.70 | $60.35 | CURRENT | — |
| Apr 24, 2026 | MODERATE | 0.71 | $64.38 | CURRENT | — |
| Apr 17, 2026 | MODERATE | 0.71 | $64.82 | CURRENT | — |
| Apr 16, 2026 | MODERATE | 0.71 | $63.37 | CURRENT | — |
| Apr 10, 2026 | MODERATE | 0.71 | $65.92 | CURRENT | — |
Historical model observations for research purposes only. Past quantitative patterns do not predict future results. Not a recommendation to buy, sell, or hold any security.
| Methodology | Fair Value | vs Current | Weight | Quality | Status |
|---|---|---|---|---|---|
| Forward P/E 11 analyst estimates | $97.56 | +61.7% | 20% | A- | Analyst Est. |
| EV/EBITDA 11 industry peers | $123.06 | +103.9% | 20% | A- | Peer Data |
| Industry Median P/E 11 industry peers | $135.04 | +123.8% | 15% | A | Peer Data |
| Price / Free Cash Flow 10 industry peers | $128.02 | +112.1% | 15% | B+ | Peer Data |
| EV/EBIT 11 industry peers | $130.08 | +115.5% | 8% | B+ | Peer Data |
| EV/FCF 10 industry peers | $133.46 | +121.1% | 7% | B | Model Driven |
| Peg Ratio 8 industry peers | $71.74 | +18.9% | 5% | B | Data |
| EV To Revenue 11 industry peers | $94.18 | +56.1% | 4% | B | Data |
| Price / Sales 11 industry peers | $95.31 | +57.9% | 3% | B | Model Driven |
| Earnings Yield 11 industry peers | $135.05 | +123.8% | 2% | B | Data |
| FCF Yield 10 industry peers | $128.01 | +112.1% | 1% | B | Data |
| Weighted Output Blended model output | $113.69 | +88.4% | 100% | 87 | SIGNIFICANTLY UNDERVALUED |
| EPS Growth ↓ | P/E Multiple → | 12× | 14× | 16× (Current) | 18× | 20× |
|---|---|---|---|---|---|
| Bear Case (5%) | $49 | $57 | $65 | $73 | $81 |
| Conservative (8%) | $50 | $59 | $67 | $75 | $84 |
| Base Case (12.7%) | $52 | $61 | $70 | $78 | $87 |
| Bull Case (17%) | $54 | $63 | $72 | $81 | $90 |
Cross-sectional regression predicting expected multiples based on growth, margins, ROIC, and beta.
| Multiple | Avg | Median | Min | Max | Std |
|---|---|---|---|---|---|
| P/E Ratio | 24.59 | 22.34 | 17.33 | 37.91 | 7.01 |
| EV/EBIT | 19.77 | 16.45 | 12.85 | 38.15 | 8.61 |
| EV/EBITDA | 14.52 | 14.48 | 11.86 | 19.82 | 2.81 |
| P/FCF | 21.33 | 20.83 | 17.14 | 27.77 | 3.74 |
| P/FFO | 20.44 | 19.61 | 15.37 | 28.52 | 4.70 |
| P/TBV | 12.27 | 11.92 | 9.12 | 16.50 | 2.48 |
| P/AFFO | 24.20 | 22.14 | 17.39 | 36.80 | 6.54 |
| P/B Ratio | 5.62 | 5.10 | 4.76 | 7.56 | 1.09 |
| Div Yield | 0.02 | 0.02 | 0.01 | 0.02 | 0.00 |
| P/S Ratio | 2.90 | 2.65 | 2.38 | 3.91 | 0.55 |
Based on our peer multiples analysis with 28 valuation metrics, the model estimates AOS's fair value at $113.69 vs the current price of $60.35, implying +88.4% upside potential. Model verdict: Significantly Undervalued. Confidence: 87/100. This is a quantitative estimate, not a recommendation.
The blended fair value of $113.69 is calculated using four lenses: industry median multiples (40%), historical multiples (30%), forward estimates (20%), and quality-adjusted multiples (10%). Monte Carlo simulation (10,000 iterations) gives a range of $101.07 (P10) to $116.71 (P90), with a median of $108.77.
AOS's current P/E of 15.6x compares to the industry median of 35.0x (11 peers in the group). This represents a -55.3% discount to the industry. The historical average P/E is 24.6x over 7 years. Signal: Deep Discount.
29 analysts cover AOS with a consensus rating of Hold. The consensus price target is $74.00 (range: $69.00 — $80.00), implying +22.6% upside from the current price. Grade breakdown: Strong Buy (0), Buy (10), Hold (18), Sell (1), Strong Sell (0).
The model confidence score is 87/100, based on: data completeness (30), peer quality (25), historical depth (20), earnings stability (8), and model agreement (4). Cyclicality penalty: -0 points. The model shows strong agreement across inputs.
The model flags several key risks: (1) Macro/regulatory risks are not captured in this model but remain material.
Peak earnings risk refers to the possibility that AOS's current profitability is above its sustainable long-term trend. The model detects a margin Z-score of +0.5σ, meaning margins are 0.5 standard deviations above their historical average. If margins revert to the 7-year mean (16.1%), the model estimates fair value drops by 8280.0% to approximately $110. This isn't a prediction — it's a scenario analysis.
No. This dashboard is a quantitative research tool for educational and informational purposes only. It is not investment advice, a solicitation, or a recommendation to buy, sell, or hold any security. The operator of this platform is not a registered investment advisor (RIA), broker-dealer, or financial planner. All model outputs, fair value estimates, signals, and scenarios are the result of automated quantitative computations and should not be construed as professional financial guidance. You should consult a qualified, licensed financial advisor before making any investment decisions. Past model performance is not indicative of future results.