AOSNEUTRAL

AOS Return on Equity (ROE) Analysis

29.4%

Higher than 63% of Industrials sector peers

Updated 4155h ago·SEC filings & market data

Key Takeaway

Sector Performance

63th percentile

AOS

29.4%

Sector Median

15.3%

Sector Avg

-40.0%

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Deep Analysis

O. Smith’s Return on Equity (ROE) of 29.4% means that for every dollar of shareholders’ equity, the company generated $0.294 in net profit over the past year — a measure of how efficiently it uses investor capital. This is well above the Industrials sector median of 10.8%, placing AOS in the 73rd percentile among its peers, indicating stronger profitability than most. Trend data is not available: the year-over-year change, quarter-over-quarter change, and the last eight quarters are all listed as N/A, so no directional pattern can be assessed. The high absolute ROE level signals a low-risk profitability profile, but the absence of trend information leaves uncertainty around whether this performance is sustainable or deteriorating. This combination supports the overall NEUTRAL verdict — the strong ROE is a positive attribute, yet without trend context, a cautious stance is warranted.

Frequently Asked Questions

What does the Return on Equity (ROE) tell investors about AOS?

ROE measures how effectively management turns equity into profit. Consistently above 15% is typically considered strong. Negative equity distorts this metric.

How is the Return on Equity (ROE) calculated?

Return on Equity (ROE) is calculated as: Net Income / Shareholders' Equity.

How does AOS's Return on Equity (ROE) compare to its sector?

AOS's Return on Equity (ROE) of 29.4% compares to a Industrials sector median of 15.3%, placing it in the 63th percentile.

Who are AOS's closest peers by Return on Equity (ROE)?

The closest Industrials peers by Return on Equity (ROE) include: PWR (15.3%), AME (13.9%), ROP (13.1%), XPO (19.9%), BLDR (2.5%).

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Learn More About Return on Equity (ROE)

What Is Return on Equity (ROE) and Is Higher Always Better?

Return on equity ROE measures how efficiently a company generates profit from shareholder capital. Learn how to decompose ROE using DuPont analysis and why high leverage can make it dangerous—with Apple and JPMorgan examples.

The Formula

Net Income / Shareholders' Equity

Why It Matters

ROE measures how effectively management turns equity into profit. Consistently above 15% is typically considered strong. Negative equity distorts this metric.