A.O. Smith Raises Price Target to $81 Amid Robust Demand

Stifel has raised its price target for A.O. Smith (AOS) to $81 from $78, citing robust demand for the company's products. Analysts expect stable demand to prompt companies to revise their guidance upwards during Q2 earnings announcements. The average target price is $76.01, with an upside of 8.12% from the current price of $70.30. The estimated GF Value is $76.84, indicating a 9.3% upside from the current price.

Stifel has raised its price target for A.O. Smith (AOS) to $81, up from $78, citing robust demand for the company's products. The analyst firm, maintaining a Buy rating, expects stable demand to prompt companies to revise their guidance upwards during Q2 earnings announcements [1]. The average target price is $76.01, with an upside of 8.12% from the current price of $70.30. The estimated GF Value is $76.84, indicating a 9.3% upside from the current price [2].

A.O. Smith, a leading manufacturer of water heaters, has shown strong financial health with a GOOD overall rating and a history of consistent dividend increases. The company's recent price increases of 6%-9% across its water heater products have historically been accretive to earnings per share [1]. Despite recent declines in residential water heater shipments, A.O. Smith's overall shipments remained positive, with a 2.2% year-over-year increase in combined residential and commercial water heater shipments [2].

Stifel's positive outlook is bolstered by improving consumer sentiment in China, a significant market for A.O. Smith. The company also faces challenges from volatile tariffs, particularly steel tariffs, which could impact its profitability in the second quarter of 2025 [1]. However, A.O. Smith's strategic moves, such as the appointment of Ming Cheng as Chief Technology Officer, reflect its efforts to navigate global market conditions and enhance its leadership team [2].

Investors should closely monitor A.O. Smith's upcoming second-quarter earnings, scheduled for July 24, 2025. The company is expected to report revenues of $987.3 million and adjusted earnings of 97 cents per share, indicating a decline from the prior-year quarter [3]. The Zacks Consensus Estimate suggests an earnings beat for A.O. Smith, with an Earnings ESP of +4.48% and a Zacks Rank of 3.

References:
[1] https://www.investing.com/news/analyst-ratings/ao-smith-stock-price-target-raised-to-81-by-stifel-on-water-heater-pricing-93CH-4143726
[2] https://www.gurufocus.com/news/2989669/ao-smith-aos-sees-price-target-increase-following-positive-outlook-aos-stock-news
[3] https://www.nasdaq.com/articles/o-smith-set-report-q2-earnings-beat-store