Why NYSE:AOS qualifies as a good dividend investing stock.

Our stock screening tool has identified SMITH (A.O.) CORP (NYSE:AOS) as a strong dividend contender with robust fundamentals. NYSE:AOS exhibits commendable financial health and profitability, all while offering a sustainable dividend. Let's delve into each aspect below.

A Closer Look at Dividend for NYSE:AOS

ChartMill employs its own Dividend Rating system for all stocks. This score, on a scale of 0 to 10, is determined by evaluating different dividend factors, such as yield, historical performance, dividend growth, and sustainability. NYSE:AOS has been assigned a 7 for dividend:

• AOS's Dividend Yield is rather good when compared to the industry average which is at 1.10. AOS pays more dividend than 97.50% of the companies in the same industry.
• The dividend of AOS is nicely growing with an annual growth rate of 7.41%!
• AOS has been paying a dividend for at least 10 years, so it has a reliable track record.
• AOS has not decreased their dividend for at least 10 years, which is a reliable track record.
• 35.68% of the earnings are spent on dividend by AOS. This is a low number and sustainable payout ratio.

A Closer Look at Health for NYSE:AOS

ChartMill assigns a proprietary Health Rating to each stock. The score is computed by evaluating various liquidity and solvency ratios and ranges from 0 to 10. NYSE:AOS was assigned a score of 5 for health:

• The Debt to FCF ratio of AOS is 0.41, which is an excellent value as it means it would take AOS, only 0.41 years of fcf income to pay off all of its debts.
• AOS has a Debt to FCF ratio of 0.41. This is amongst the best in the industry. AOS outperforms 87.50% of its industry peers.
• A Debt/Equity ratio of 0.10 indicates that AOS is not too dependend on debt financing.
• With a decent Debt to Equity ratio value of 0.10, AOS is doing good in the industry, outperforming 70.00% of the companies in the same industry.

Evaluating Profitability: NYSE:AOS

ChartMill utilizes a Profitability Rating to assess stocks, scoring them on a scale of 0 to 10. This rating takes into account a variety of profitability ratios and margins, both in absolute terms and in comparison to industry peers. NYSE:AOS has earned a 8 out of 10:

• AOS has a better Return On Assets (16.47%) than 90.00% of its industry peers.
• Looking at the Return On Equity, with a value of 28.33%, AOS is in the better half of the industry, outperforming 80.00% of the companies in the same industry.
• AOS has a better Return On Invested Capital (23.53%) than 95.00% of its industry peers.
• The Average Return On Invested Capital over the past 3 years for AOS is significantly above the industry average of 13.22%.
• The last Return On Invested Capital (23.53%) for AOS is above the 3 year average (18.84%), which is a sign of increasing profitability.
• AOS's Profit Margin of 13.98% is fine compared to the rest of the industry. AOS outperforms 72.50% of its industry peers.
• AOS's Profit Margin has improved in the last couple of years.
• AOS has a better Operating Margin (19.00%) than 72.50% of its industry peers.
• AOS's Operating Margin has improved in the last couple of years.
• With a decent Gross Margin value of 38.14%, AOS is doing good in the industry, outperforming 70.00% of the companies in the same industry.

Our Best Dividend screener lists more Best Dividend stocks and is updated daily.

Our latest full fundamental report of AOS contains the most current fundamental analsysis.

Disclaimer

Important Note: The content of this article is not intended as trading advice. It is essential to perform your own analysis and exercise caution when making trading decisions. The article presents observations created by automated analysis but does not guarantee any trading or investment outcomes. Always trade responsibly and make independent judgments.