Sell Alert October 6, 2016
Smith, A.O. (AOS 51.25) reached its Minimum Sell Price of 51.36 today, October 6. The company reported slow sales growth in the first two quarters, but earnings increased more than 20% in each of the quarters. Profits were aided by lower raw material costs and higher water heater prices received by the company. AOS shares have surged to a new all-time high and are now over-valued at 28.2 times current earnings per share. The dividend yield is small at 0.9%.
A.O. Smith shares split two for one today. I have adjusted my data accordingly.
A.O. Smith was first recommended in September 2015 at 34.48. The company was featured in the Cabot Enterprising Model using the Graham-Buffett analysis. AOS has advanced 49.0% in the past 12 months compared to a gain of 10.1% for the Standard & Poor’s 500 Index during the same time period. Sell.