Zurn Elkay Water Solutions (ZWS) Net Margin Improvement Reinforces Bullish Earnings Narratives

Simply Wall St.04-23

Zurn Elkay Water Solutions (ZWS) opened 2026 with Q1 revenue of US$433 million and basic EPS of US$0.35, while trailing twelve month figures show revenue of US$1.7 billion and EPS of US$1.25, setting ...

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Over the past year, the company has seen revenue move from US$388.8 million in Q1 2025 to US$433 million in Q1 2026 and basic EPS step up from US$0.24 to US$0.35, supported by higher trailing twelve month net income of US$210.3 million, which points to a...","collect":0,"end_time":0,"defaultTopTitle":"simplywall.st","property":["earning"],"viewcount":null,"language":"en","relate_stocks":{"BLSG":"2倍做多BLSH ETF-Leverage Shares","IE0009354923.USD":"JANUS HENDERSON US VENTURE \"A2\" (USD) ACC","BLSX":"Tradr 2X Long BLSH Daily ETF","BK4112":"金融交易所和数据","BK4086":"建筑产品","ZWS":"Zurn Water Solutions","LU0728928796.USD":"abrdn SICAV I - GLOBAL SMALL&MID-CAP SDG HORIZONS EQUITY \"A\" (USD) ACC"},"translate_title":"Zurn Elkay Water Solutions(ZWS)净利润率的改善强化了看涨的盈利叙述","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"ZWS":1.98,"BLSG":0.6,"BLSX":0.6},"content_text":"Zurn Elkay Water Solutions (ZWS) opened 2026 with Q1 revenue of US$433 million and basic EPS of US$0.35, while trailing twelve month figures show revenue of US$1.7 billion and EPS of US$1.25, setting a clear earnings benchmark for investors. Over the past year, the company has seen revenue move from US$388.8 million in Q1 2025 to US$433 million in Q1 2026 and basic EPS step up from US$0.24 to US$0.35, supported by higher trailing twelve month net income of US$210.3 million, which points to a business that is currently converting sales into profits with firmer margins. See our full analysis for Zurn Elkay Water Solutions. With the latest revenue and EPS numbers on the table, the next step is to see how this profit profile lines up with the widely held narratives around Zurn Elkay’s growth, risks, and overall earnings story. See what the community is saying about Zurn Elkay Water Solutions NYSE:ZWS Earnings & Revenue History as at Apr 2026 Advertisement12.1% net margin underpins profit quality  Over the last 12 months, Zurn Elkay converted US$1.7b of revenue into US$210.3 million of net income, which works out to a 12.1% net profit margin compared with 10.5% a year earlier. Consensus narrative points to higher margin filtration and water safety products as a key earnings driver. The move from 10.5% to 12.1% margins alongside trailing EPS of US$1.25 supports the idea that higher margin offerings are having an effect, even as revenue forecasts of about 4.9% a year keep overall top line expectations relatively modest.\n     Government backed demand for water quality solutions in areas like schools fits with margins holding at 12.1%, because these projects often require more advanced, higher value systems. Comments about supply chain improvements and pricing discipline line up with net income rising from US$165.9 million to US$210.3 million over the last 12 months, suggesting cost control is playing a real part in the margin picture.    With margin trends pointing in the right direction and higher value filtration products in the mix, it is worth checking how the bullish case ties these earnings to future growth and policy support 🐂 Zurn Elkay Water Solutions Bull Case Earnings growth meets a premium P/E  Trailing EPS of US$1.25 sits against a P/E of 41.6x, which is above both the US Building industry at 21.9x and peers at 34.2x, even though earnings are forecast to grow around 10.8% a year and revenue about 4.9% a year. Bears focus on this valuation gap, and the combination of a 41.6x P/E and earnings growth forecasts below the broader US market earnings growth of 16% a year, arguing that the share price already bakes in a lot of good news even with the strong 26.8% earnings growth reported over the last year.\n     The DCF fair value of US$47.25 compared with the current share price of US$52.48 gives critics another data point, as the market price sits above that cash flow estimate. Five year earnings growth of 36.2% a year is strong, and the bearish view is that this track record is now reflected in the 41.6x multiple, leaving less room if growth settles closer to the 10.8% forecast range.    When a stock trades at a richer P/E than peers, it pays to understand the more cautious arguments about how much growth is already priced in 🐻 Zurn Elkay Water Solutions Bear Case Quarterly profits track long term trend  On a shorter view, Q1 2026 net income of US$58.9 million and EPS of US$0.35 sit within a trailing 12 month earnings base of US$210.3 million and EPS of US$1.25, while the last five years saw earnings grow about 36.2% a year and 26.8% over the last year alone. Analysts' consensus view links this earnings pattern to a steady long term demand story, arguing that regulatory support for water quality and continued share gains in areas like healthcare and education can support revenue growth assumptions of roughly 5.5% a year and margin expectations rising toward 14.8% over time.\n     The move in trailing revenue from US$1.6b to US$1.7b and the current 12.1% net margin give some grounding to those margin expansion assumptions, because they show profit keeping pace with revenue. At the same time, the current share price of US$52.48 compared with the cited analyst target level of US$54.11 leaves only a small gap, so any difference between actual earnings and the US$293.9 million earnings target for around 2029 can matter quite a bit to how closely the story matches the numbers.    Next Steps To see how these results tie into long-term growth, risks, and valuation, check out the full range of community narratives for Zurn Elkay Water Solutions on Simply Wall St. Add the company to your watchlist or portfolio so you'll be alerted when the story evolves. Does this mix of optimism and concern match your own reading of the numbers, or not yet? Move quickly from headline impressions to hard evidence by weighing up the 2 key rewards and 1 important warning sign. See What Else Is Out There The rich 41.6x P/E against more modest earnings and revenue forecasts suggests you might be paying a premium price for expectations that already look full. If that valuation gap worries you, sharpen your opportunity set by checking companies that pair stronger value signals with quality fundamentals using the 61 high quality undervalued stocks.  This article by Simply Wall St is general in nature. We provide commentary based on historical data\n    and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your\n    financial situation. We aim to bring you long-term focused analysis driven by fundamental data.\n    Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.\n    Simply Wall St has no position in any stocks mentioned.Valuation is complex, but we're here to simplify it.Discover if Zurn Elkay Water Solutions might be undervalued or overvalued with our detailed analysis, featuring fair value estimates, potential risks, dividends, insider trades, and its financial condition.Access Free AnalysisHave feedback on this article? Concerned about the content? Get in touch with us directly. 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