Watts Water Technology, Inc. - Momentum

Watts Water Technology, Inc. (WTS) continues to trade near its multi-year high after reporting better than expected Q2 results on August 3. Not only are estimates on the rise, but the valuation picture is in check too for this Zacks #1 rank stock.

Second-Quarter Results

Revenue for the period was up 5% from last year to $324 million. Earnings came in at 57 cents per share, 21% ahead of the Zacks Consensus Estimate calling for 47 cents. The company now has an average earnings surprise of 21% over the last four quarters.

Although China still represents a small portion of Watts' business, it led all other regions with sales growth of 19% from last year to $5.6 million.

Balance Sheet

The company also continues to strengthen its balance sheet, with cash and equivalents up $76 million from last year to $255 million. Its total debt of $379 million is up a marginal $10 million from last year.

Estimates

The analysts were encouraged by the solid results, pushing the current-year estimate up 15 cents to $2.01 while the next-year estimate added 14 cents to $2.28, a 13% growth projection.

Valuation

Not only does WTS have some nice upward momentum, it also has value, trading with a forward P/E 15.5 against its peers 17X.

2-Year Chart

WTS continues to trade near its multi-year high at $37. Look for support from the trend line on any weakness, take a look below.

Read the June 16 WTS article here

Last Week's Momentum Zacks Rank Buy Stocks

BorgWarner, Inc. (BWA) just hit a new multi-year high at $47.67 after reporting better than expected Q2 results in late July that included a 16% earnings surprise. The longer-term picture looks solid too with the next-year estimate projecting 29% growth. Read Full Article.

Cinemark Holdings, Inc. (CNK) recently broke a short-term down trend after reporting better than expected Q2 results in early August. But in spite of the solid quarter and upward momentum, shares still trade at a discount to their peers. Read Full Article.

Advance Auto Parts, Inc. (AAP) just hit a new multi-year high after reporting strong Q2 results in mid August that included a 14% earnings surprise. Estimates are on the rise and the valuation picture is in check, providing some solid upward momentum for this Zacks #1 rank stock. Read Full Article.

Hill-Rom Holdings, Inc. (HRC) recently surged to a new all-time high at $35.89 after reporting an impressive 45% earnings surprise in late July. The solid quarter pushed estimates higher, with the current year adding 25 cents to $1.64. Read Full Article.

Michael Vodicka is the Momentum Stock Strategist for Zacks.com. He is also the Editor in charge of the new Zacks Momentum Trader Service.
 
WATTS WATER TEC (WTS): Free Stock Analysis Report
 
Zacks Investment Research