Zurn Elkay Beats on Q3 Growth, Raises Dividend 18%, but Guides Q4 Conservatively
ZWS is trading near its 52-week low of $43.06 (14% above the low).
Summary
Zurn Elkay posted Q3 net sales of $495.1 million, up 9% from $455.4 million a year ago, with 7% core growth plus 2% from the Intellihot acquisition. Adjusted EPS rose to $0.52 from $0.43 and adjusted EBITDA margin expanded to 28.3% from 26.8%, while free cash flow came in at $109.6 million. The company raised its annual dividend 18% to $0.52 per share and bought back $35 million of stock (0.7 million shares) in the quarter, with net debt leverage at just 0.4x. The offset is the outlook: management guided Q4 net sales to $430-437 million and adjusted EBITDA to $120-123 million, framing it as a time to be conservative given uncertainty in served markets. Q4 revenue guidance sits below the Q3 run rate, so the market will weigh margin strength and capital returns against a softer sequential top-line setup. The Q3 call is October 28 at 8:30 a.m. ET.
At the time of this announcement, ZWS was trading at $49.15 on NYSE in the Industrial Applications And Services sector, with a market capitalization of approximately $8.2B. The 52-week trading range was $43.06 to $55.00. This news item was assessed with positive market sentiment and an importance score of 7 out of 10. Source: BusinessWire.