Watts Water Technologies, Inc. — Cyborg Score 8/10
Strong
Industrial Products / Water Technologies
Strategic Profile
Watts has demonstrated elite profitability for an industrials business, boasting an average operating margin of 16.6%. The company achieved 2025 sales of $2.44B with 19.6% adjusted operating margin and $10.58 EPS. Watts projects significant sales growth by 2026 of 8-12%, with anticipated operating margins of 18.8% to 19.4%.
Cyborg Score Rationale
Watts demonstrates strong financial health with a robust balance sheet and expanding operating margins. The debt-to-equity ratio is a low 0.1, highlighting conservative leverage practices. Q4 2025 sales grew 15.7% year-over-year beating expectations by 2.3%, while adjusted EPS of $2.62 was 12% above consensus.
Top Insights
Record 2025 earnings of $10.17 EPS with $356M free cash flow generation
Stock up 20.3% year-to-date and trading at new 52-week high of $335.12
Three-year revenue growth rate of 8% with gross margin of 48.83% and operating margin of 18.98%
2026 organic sales growth guidance of 2-6%
Named Competitors
Mueller Water Products — Water infrastructure and mechanical products
Flowserve Corporation — Flow control and sealing solutions
Roper Technologies — Diversified industrial equipment and software
Recent Developments
(December 2025) Watts completed acquisition of Saudi Cast, a drainage solution producer
(December 2025) Named one of America's Most Responsible Companies 2026 by Newsweek for 7th consecutive year
(February 2026) Q4 2025 revenue beat expectations by 2.3%, adjusted EPS beat by 12%
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