Zurn Elkay Water Q2 sales beat estimates

Overview

• US water management firm's Q2 net sales rose 10%, beating analyst expectations

• Adjusted EPS for Q2 increased to $0.50 from $0.42 a year ago

• Company repurchased $50 mln in shares and completed Intellihot acquisition

Outlook

• Zurn Elkay expects Q3 core sales growth of 6% to 7% and adjusted EBITDA margin near 28%

• Company sees full-year 2026 adjusted EBITDA between $503 mln and $513 mln

• Zurn Elkay expects full-year free cash flow of at least $350 mln, excluding tariff refunds

Result Drivers

• CORE SALES GROWTH - 10% increase in core sales, with growth across all product categories, drove higher revenue

• PRICE REALIZATION AND PRODUCTIVITY - Margin expansion attributed to price realization and productivity initiatives under the Zurn Elkay Business System

Company press release: ID:nBw2C6nGma

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 6 "strong buy" or "buy", 6 "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the construction supplies fixtures peer group is "buy"

• Wall Street's median 12-month price target for Zurn Elkay Water Solutions Corp is $56.00, about 14.8% above its July 27 closing price of $48.77

• The stock recently traded at 26 times the next 12-month earnings vs. a P/E of 26 three months ago

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For questions concerning the data in this report, contact Estimates.Support@lseg.com. For any other questions or feedback, contact reuters.support@thomsonreuters.com.

(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)