Advanced Drainage Systems (WMS)
NYSEIndustrialsConstruction MaterialsSnapshot 2026-09-04
$135.76+0.69%
Close 2026-09-04 · 1-day change
NYSEIndustrialsConstruction MaterialsSnapshot 2026-09-04
Intact: The reason to own it still holds.
Advanced Drainage grew sales 5% in fiscal 2026. Q4 sales rose 9.9%. The company raised its dividend to $0.20 per share. Capital spending is steady near $200 million.
Sales growth could slow below 5%. Dividend or buybacks may stall. Capital spending cuts could hurt future growth.
The price is about 9% above our fair value near $136. Analysts expect 11% revenue growth. Our fair value is 24% below the Street median, so the market is somewhat optimistic.
Breaks if: Capital expenditures fall below $150 million or rise above $250 million in 2027
Maintain capital expenditures around $200 million annually to invest in safety, capacity, and productivity improvements.
Stated in 3 of last 3 quarters. Capital expenditures were $249.8M in fiscal 2026 and guidance for fiscal 2027 is approximately $200M. Management has consistently communicated this capex discipline, and the trajectory shows a planned moderate reduction aligned with stated guidance.
“Capital expenditures are expected to be approximately $200 million for fiscal 2027.”
“Capital expenditures increased $36.8 million over prior year as we invest in safety, capacity and productivity.”
“Capital expenditures are expected to be in the range of $200 million to $225 million.”
Breaks if: Dividend falls below $0.20 or capital return drops below $155M in 2026
Breaks if: YoY revenue growth falls below 5% in fiscal 2026
Realign reportable segments to reflect acquisition of NDS and how management assesses performance and allocates resources.
This is not a price target or investment advice.
A long-form read on the 1–3 year hold thesis. It updates when the weekly evidence changes.
This is a long-term thesis focused on a durable compounder. WMS is working to drive growth through acquisitions and product innovation, while also maintaining disciplined capital allocation.
The current valuation suggests that the market sees WMS as cheap compared to its peers, with a slight expectations gap. The stock is priced with a low fragility tier, indicating that the market does not expect significant volatility in the near term.
Fundamentals are likely to remain stable, supported by recent revenue growth and a commitment to shareholder returns through dividends and share repurchases. However, there is a moderate risk due to potential misses from industry peers.
The thesis hinges on the performance of sector bellwethers like JCI, MAS, and CSL. Positive earnings and guidance from these companies could provide a favorable tailwind, while negative trends could pose risks.
In the next 1 to 3 years, WMS's performance will depend on its ability to execute on growth strategies and navigate sector challenges. Not investment advice.
The most important moves since the prior daily snapshot.
Yes, our read has strengthened. The latest earnings beat supports this improved outlook. There are no new threats impacting the thesis at this time.
as of 2026-09-04
Review the evidence to watch, what would become a concern, and what would make it less concerning.
Not investment advice. Scores describe historical and current data; they are not forecasts of future returns. Consult a licensed advisor before making investment decisions.