Watts Water Q2 Sales Surge 19% to $763M, Crushing Estimates
WTS sits 49% above its 52-week low of $251.17.
Summary
Watts Water Technologies reported Q2 2026 sales of $763.2M, up 19% YoY and well above the $725.75M consensus, with adjusted EPS of $3.53. Organic growth was 12%, led by data center demand and pricing.
Key Events · Earnings and Guidance · WTS
-
Q2 Sales Beat
Net sales of $763.2M, up 18.6% YoY, exceeding the $725.75M consensus. Organic growth was 12.2%, driven by price and data center volume.
-
Earnings Growth
Adjusted EPS of $3.53 vs. $3.01 YoY. Net income rose 17% to $118.3M. Operating income increased 14% to $154.0M.
-
Margin Compression
Gross margin declined to 49.0% from 50.6%, reflecting dilution from acquisitions and the absence of a prior-year tariff benefit.
-
Debt Reduction
Long-term debt reduced by $90M to $108.0M. Cash and equivalents stand at $347.9M.
Analysis · WTS · Manufacturing
A standout quarter for Watts Water underscores the strength of industrial demand. Sales jumped 19% to $763.2 million, handily beating the $725.75 million consensus, with organic growth of 12% fueled by robust price realization and data center volume. Operating income climbed 14% to $154 million, and adjusted EPS reached $3.53, up from $3.01 a year ago. Gross margin, however, slipped to 49% from 50.6%, pressured by acquisition dilution and the absence of a prior-year tariff benefit. The balance sheet also improved as the company paid down $90 million in debt. This beat reinforces the industrial growth narrative and demonstrates effective navigation of inflation and tariffs.
At the time of this filing, WTS was trading at $373.50 on NYSE in the Manufacturing sector, with a market capitalization of approximately $12.1B. The 52-week trading range was $251.17 to $394.54. This filing was assessed with positive market sentiment and an importance score of 8 out of 10.