A.O. Smith Corp, known by the ticker symbol AOS, is a large-cap specialized industrial machinery firm, operating in the Industrials business sector. This is my first ever report on AOS for this Viital stock portfolio or any of my previous six portfolios

A.O. Smith Corporation manufactures and markets comprehensive lines of residential and commercial gas, gas tankless, and electric water heaters. Supplementary products include water heating equipment, condensing and noncondensing boilers, and water system tanks. 

Photo by Yoann Boyer on Unsplash

The company's two operating segments are by geographic region: North America (majority of total revenue) and the Rest of the World. A material portion of sales in North America derive from replacing existing products, and the company utilizes a wholesale distribution channel and multiple selling locations. 

The Rest of the World segment sells primarily to Asian countries and operates sales offices to expand distribution and market its product portfolio.

The company offers its products primarily under the A. O. Smith, State, Lochinvar, and water softener brands. 

It distributes its products through independent wholesale plumbing distributors, as well as through retail channels consisting of hardware and home center chains, and manufacturer representative firms; and offers Aquasana branded products directly to consumers through e-commerce, as well as other online retailers. 

The company was founded in 1874 and is headquartered in Milwaukee, Wisconsin.

Three key data points gauge any dividend equity or fund such as A.O. Smith Corporation (AOS):

(1) Price

(2) Dividends

(3) Returns

Those three basic keys best tell whether any company has made, is making, and will make money. 

AOS Price

Smith's price per share was $83.92 as of yesterday's market close. One year ago its price was $58.32. Therefore AOS's share price rose $25.60 or just about 44% in the past year.

If AOS's stock trades in the range of $50.00 to $100.00 this next year, its recent $83.92 share price might rise by $7.08 to reach $91.00  by January 13, 2023. This estimate is based on the average annual AOS price upsides over the past ten years.

AOS Dividends

Smith's most recent quarterly dividend of  $0.28 was paid to shareholders on November 15th to those of record on October 28th. That Q dividend payout, carried forward, amounts to $1.12 annually and yields 1.33% per yesterday's $83.92. closing price. 

A.O. Smith Corporation (AOS) has paid variable quarterly dividend payouts since February 15, 1985. That stretch will come to 37 years next month.

AOS Returns

Adding the $1.12 annual estimated AOS forward-looking dividend to the ten-year average share-price increase of $7.08 shows an $8.20 potential gross gain, per share, to be reduced by any costs to trade AOS shares.  

At yesterday's $83.92 price per share, a little over $1000 would buy 12 shares.

A $10 broker fee (if charged) would be paid half at purchase and half at sale and might cost us about $0.83 per share.

Subtract that maybe $0.83 brokerage cost from my estimated $8.20 gross gain per share results in a net gain of $7.37 X 32 shares = $88.44 for a 8.82% net gain on a $1,007.04 investment.

So it is that A.O. Smith Corporation (AOS) shows a possible 8.84% net gain including a 1.33% forward estimated dividend yield. 

Over the next year at this time a $1000 investment in A.O. Smith Corporation (AOS) could generate $13.30 in cash dividends alone. Note that a single share of AOS stock bought at yesterday's closing price was $83.92. Therefore, AOS's share price is over six times less than the dividend income from $1000.00 invested. So, by my dogcatcher ideal, now is not the point to pickup A.O. Smith Corporation (AOS)  shares. The estimated next-year dividend from $1K invested is over 6.3 times less than AOS's single share price. Consider yourself alerted. Its a sign!  Watch for AOS single share price to fall below $40.00. 

All of the estimates above are speculation based on the past history of A.O. Smith Corporation (AOS). Only time and money invested in this stock will determine its market value.