Zurn Elkay Water Solutions Corporation (ZWS) Stock Analysis

Why this analysis is different

• A sector-relative MoonshotScore — five pillars (business quality, financial safety, valuation, growth durability, momentum) re-ranked nightly against the full universe of US-listed common stocks.
• An AI Council read across up to eight perspectives — value, macro, quantitative, and momentum lenses — that shows where they disagree instead of averaging the tension away.
• Figures come straight from FMP and Yahoo Finance filings data. The AI writes the narrative around the numbers — it never edits the numbers.

Zurn Elkay Water Solutions Corporation (ZWS) Industrial Operations Profile

Zurn Elkay Water Solutions Corporation delivers comprehensive water system solutions for non-residential buildings, focusing on enhancing water quality, safety, and conservation. With a diverse product portfolio and a presence in key sectors like healthcare and education, the company addresses critical water management needs, positioning it as a key player in the industrial sector.

What Is the Investment Thesis for ZWS?

With a market capitalization of $7.55B and a profit margin of 12.3%, the company demonstrates financial stability. Key growth catalysts include increasing demand for water conservation and safety solutions in non-residential buildings. The company's gross margin of 43.7% indicates strong pricing power and efficient operations. However, investors may want to evaluate the P/E ratio of 27.59, which suggests a premium valuation. The dividend yield of 0.78% offers a modest income stream. The company's beta of 0.81 indicates lower volatility compared to the market, making it a relatively stable investment. Overall, Zurn Elkay's strategic positioning in the water solutions market, coupled with its financial performance, supports a positive investment outlook.

Based on FMP financials and quantitative analysis

ZWS Key Highlights

Market Cap of $7.55B reflects substantial investor confidence in Zurn Elkay's market position.

• P/E ratio of 27.59 indicates a premium valuation, suggesting high growth expectations.
• Profit Margin of 12.3% demonstrates efficient operations and profitability.
• Gross Margin of 43.7% highlights strong pricing power and cost management.
• Dividend Yield of 0.78% provides a modest income stream for investors.

Who Are ZWS's Competitors?

ZWS is benchmarked below against 8 industry peers on price, market cap, and our AI MoonshotScore.

AI Score by Stock Expert AI · Price data: FMP / Yahoo Finance

What Are ZWS's Key Strengths?

Comprehensive product portfolio in water solutions.

• Strong brand recognition and reputation.
• Established distribution network.
• Focus on non-residential building sector.

What Are ZWS's Weaknesses?

High P/E ratio may indicate overvaluation.

• Dependence on economic conditions in the construction industry.
• Limited presence in the residential market.
• Exposure to raw material price fluctuations.

What Could Drive ZWS Stock Higher?

Increasing demand for water conservation solutions in non-residential buildings.

• Expansion in the healthcare sector due to stringent hygiene standards.
• Strategic acquisitions to broaden product offerings and market reach.
• Potential infrastructure investments by governments to upgrade water systems.
• Innovation in smart water management technologies.

What Are the Key Risks for ZWS?

Economic downturns affecting construction spending and demand for water solutions.

• Intense competition from established players in the industry.
• Changes in regulatory standards and compliance requirements.
• Fluctuations in raw material prices impacting production costs.
• Disruptions in the supply chain affecting product availability.

What Are the Growth Opportunities for ZWS?

• Expansion in Healthcare Sector: Zurn Elkay can capitalize on the growing demand for hygienic and safe water solutions in the healthcare sector. With increasing focus on infection control and patient safety, hospitals and clinics are investing in advanced water systems. The global healthcare market is projected to reach $12 trillion by 2028, presenting a significant opportunity for Zurn Elkay to expand its market share by offering specialized plumbing and water control solutions tailored to healthcare facilities. Timeline: Ongoing.
• Penetration of Educational Institutions: Educational institutions, including schools and universities, represent a substantial market for Zurn Elkay's stainless steel sinks and plumbing fixtures. As institutions upgrade their facilities to meet ADA standards and enhance hygiene, there is a growing need for durable and compliant water solutions. The education market is expected to see continued investment in infrastructure, providing Zurn Elkay with opportunities to secure long-term contracts and increase product sales. Timeline: Ongoing.
• Growth in Fire Protection Market: The fire protection market offers significant growth potential for Zurn Elkay, particularly through its fire protection products. With increasing regulations and safety standards in commercial buildings, the demand for reliable fire protection systems is rising. Zurn Elkay can leverage its expertise in water control and backflow prevention to provide comprehensive fire protection solutions, capturing a larger share of this expanding market. The global fire protection systems market is projected to reach $115 billion by 2027. Timeline: Ongoing.
• Strategic Acquisitions and Partnerships: Zurn Elkay can pursue strategic acquisitions and partnerships to expand its product portfolio and geographic reach. By acquiring companies with complementary technologies or market access, Zurn Elkay can enhance its competitive position and accelerate growth. Partnerships with construction firms and engineering companies can also provide access to new projects and customers. This strategy allows Zurn Elkay to diversify its offerings and strengthen its market presence. Timeline: Ongoing.
• Innovation in Water Conservation Technologies: Investing in research and development to create innovative water conservation technologies can drive future growth for Zurn Elkay. Developing advanced water-saving fixtures, smart water management systems, and sustainable plumbing solutions can attract environmentally conscious customers and differentiate the company from competitors. The increasing focus on sustainability and water scarcity will drive demand for these innovative products, positioning Zurn Elkay as a leader in water conservation. Timeline: Ongoing.

What Are ZWS's Competitive Advantages?

• Established Brand Reputation: Zurn has a strong brand reputation for quality and reliability in the water solutions market.
• Diverse Product Portfolio: The company offers a wide range of products, reducing dependence on any single product line.
• Strong Distribution Network: Zurn Elkay has a well-established distribution network, providing access to a broad customer base.
• Focus on Non-Residential Buildings: Specialization in non-residential buildings provides a competitive advantage in a niche market.

What Does ZWS Do?

Zurn Elkay Water Solutions Corporation, incorporated in 2006 and headquartered in Milwaukee, Wisconsin, specializes in designing, procuring, manufacturing, and marketing water system solutions. The company's offerings enhance water quality, safety, flow control, and conservation in and around non-residential buildings. Zurn Elkay provides a wide array of products, including finish plumbing, drainage and interceptors, water control and backflow, fire protection, PEX pipe fittings, and repair parts under the Zurn brand. Additionally, it offers hand and hair dryers, and baby changing stations under the World Dryer brand. The company also features stainless steel products under the Just Manufacturing brand, including stainless steel sinks for classrooms and academic institutions, ADA commercial stainless-steel sinks and plumbing fixtures for assisted living, faucets, bubblers, drains, and accessories. These products cater to diverse markets such as higher education, healthcare, retail, restaurant, hospitality, education, government, and fire protection. Formerly known as Zurn Water Solutions Corporation, the company has evolved to provide comprehensive water management solutions, addressing the increasing demand for efficient and safe water systems in various sectors.

What Products and Services Does ZWS Offer?

• Designs and manufactures water system solutions for non-residential buildings.
• Offers finish plumbing, drainage, and interceptor products under the Zurn brand.
• Provides water control and backflow prevention solutions.
• Manufactures fire protection systems and components.
• Offers stainless steel sinks and plumbing fixtures under the Just Manufacturing brand.
• Markets hand and hair dryers, and baby changing stations under the World Dryer brand.

How Does ZWS Make Money?

• Designs, manufactures, and sells water system solutions.
• Generates revenue through product sales to distributors, contractors, and end-users.
• Provides aftermarket services and repair parts to maintain customer relationships.
• Focuses on non-residential buildings, including healthcare, education, and commercial sectors.

What Industry Does ZWS Operate In?

Zurn Elkay Water Solutions Corporation operates within the industrial sector, specifically in pollution and treatment controls. The industry is driven by increasing regulations and demand for water conservation and safety. The competitive landscape includes companies like DY: Dycom Industries, Inc., IESC: IES Holdings, Inc., AAON: AAON, Inc., OSK: Oshkosh Corporation, and VMI: Valmont Industries, Inc. These companies compete on product innovation, service quality, and geographic reach. The market is expected to grow as water scarcity and environmental concerns intensify, positioning Zurn Elkay favorably due to its focus on water system solutions for non-residential buildings.

Who Are ZWS's Key Customers?

• Healthcare facilities (hospitals, clinics, assisted living).
• Educational institutions (schools, universities).
• Retail and restaurant chains.
• Government buildings and infrastructure.

Company Profile

Zurn Elkay Water Solutions Corporation operates in the Industrial - Machinery industry within the Industrials sector. It is headquartered in Milwaukee, US. The company is led by CEO Todd A. Adams. ZWS has traded publicly since 2012.

Return on equity for Zurn Elkay Water Solutions Corporation stands at 17.1%, a gauge of how efficiently it converts shareholder capital into profit. Return on assets is 9.9%, showing how much profit it generates from its asset base. ZWS trades at a trailing price-to-earnings ratio of 27.59, roughly in line with the Industrials sector average of ~28.00x. Its free cash flow yield is 5.0%, a gauge of the cash the business throws off relative to its market value. A current ratio of 3.05 indicates the company holds enough short-term assets to cover its near-term obligations. Its earnings yield is 3.6%, the inverse of the P/E and a quick read on earnings relative to price.

ZWS Valuation & Market Position

With a $7.55B market cap, Zurn Elkay Water Solutions Corporation sits in the mid-cap segment of the market. Analyst price targets span from $55.00 to $62.00, with a consensus of $58.67. At the current price of $45.52, that implies approximately 29% upside potential. Relative to its peer group, ZWS's quantitative score of 80/100 is above the peer average of 69/100.

Quarterly Financial Performance: Zurn Elkay Water Solutions Corporation

Revenue for Zurn Elkay Water Solutions Corporation came in at $442.2M during Q2 FY2026, a 2.1% improvement versus the preceding quarter. The company recorded net income of $113.3M, with diluted EPS of $0.67. Revenue has increased across the last three reported quarters, suggesting sustained momentum for this mid-cap Industrials company. Across the four most recent quarters, ZWS averaged $0.41 in diluted EPS.

Zurn Elkay Water Solutions Corporation's Piotroski F-Score is 8/9, a 9-point checklist of profitability, leverage and efficiency — signaling solid underlying fundamentals. Its Altman Z-Score of 4.96 places it in the safe zone, indicating low near-term bankruptcy risk.

Zurn Elkay Water Solutions Corporation has beaten Wall Street's EPS estimate in 8 of its last 8 reported quarters — a consistent record of delivering on expectations. Reported results have landed about 9.2% above estimates on average.

Over the past six months, Zurn Elkay Water Solutions Corporation insiders filed 13 SEC Form 4 transactions — 1 sales and 12 purchases. On net that is roughly 15K shares disposed (about $938K), a signal worth weighing alongside the fundamentals.

ZWS Financials

ZWS Latest News

ZWS Analyst Consensus

ZWS MoonshotScore

Common Questions About ZWS (Industrials)

Disclaimer: This content is for informational purposes only and does not constitute investment advice. Always do your own research and consult a financial advisor.

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