Advanced Drainage Systems (NYSE:WMS) Posts Quarterly Earnings Results, Beats Estimates By $0.09 EPS

Advanced Drainage Systems (NYSE:WMS) posted its quarterly earnings data on Thursday. The construction company reported $1.07 EPS for the quarter, beating analysts’ consensus estimates of $0.98 by $0.09, FiscalAI reports. Advanced Drainage Systems had a net margin of 15.75% and a return on equity of 27.72%. The firm had revenue of $676.76 million for the quarter, compared to the consensus estimate of $651.92 million. During the same period in the prior year, the firm posted $1.03 EPS. The firm’s revenue was up 9.9% compared to the same quarter last year.

Here are the key takeaways from Advanced Drainage Systems’ conference call:

• ADS delivered strong fiscal 2026 results, with fourth-quarter revenue up 10% to $677 million and adjusted EBITDA margin at 27.8%, while full-year free cash flow rose to $569 million. Management also said it exceeded the top end of both revenue and adjusted EBITDA guidance.
• The NDS acquisition is progressing well, and the company remains on track to achieve $25 million in annual cost synergies by year three. Management also highlighted meaningful revenue cross-selling opportunities across stormwater and wastewater channels.
• ADS significantly strengthened its balance sheet, extending weighted-average debt maturities to more than six years and lowering its weighted-average cost of debt to 5.65%. Year-end leverage was just 1.6x, even after the $1 billion NDS deal.
• Fiscal 2027 guidance reflects a choppy demand and cost environment, with revenue expected between $3.35 billion and $3.55 billion and adjusted EBITDA between $1 billion and $1.5 billion. The company expects flat overall volumes, pricing to offset inflation dollar-for-dollar, and about $300 million of revenue from NDS.
• Management is seeing both headwinds and offsets in key end markets: non-residential remains resilient, supported by large projects such as data centers, while single-family residential and agriculture are softer. ADS expects to outperform its markets through product bundling, logistics advantages, recycling, and continued share gains in higher-growth niches like advanced treatment and multifamily.

Advanced Drainage Systems Trading Down 1.1%

NYSE WMS opened at $135.30 on Friday. Advanced Drainage Systems has a one year low of $105.14 and a one year high of $179.32. The company has a 50-day simple moving average of $142.50 and a 200-day simple moving average of $150.18. The company has a debt-to-equity ratio of 0.72, a quick ratio of 3.08 and a current ratio of 4.12. The firm has a market capitalization of $10.54 billion, a PE ratio of 22.51, a price-to-earnings-growth ratio of 1.43 and a beta of 1.33.

Advanced Drainage Systems Increases Dividend

The firm also recently declared a quarterly dividend, which will be paid on Monday, June 15th. Stockholders of record on Monday, June 1st will be issued a $0.20 dividend. This is a boost from Advanced Drainage Systems’s previous quarterly dividend of $0.18. The ex-dividend date of this dividend is Monday, June 1st. This represents a $0.80 annualized dividend and a dividend yield of 0.6%. Advanced Drainage Systems’s dividend payout ratio (DPR) is presently 11.98%.

Institutional Inflows and Outflows

Hedge funds and other institutional investors have recently modified their holdings of the business. Compound Planning Inc. increased its holdings in shares of Advanced Drainage Systems by 33.1% in the 4th quarter. Compound Planning Inc. now owns 2,076 shares of the construction company’s stock worth $301,000 after acquiring an additional 516 shares during the period. Mercer Global Advisors Inc. ADV increased its holdings in shares of Advanced Drainage Systems by 62.8% in the 4th quarter. Mercer Global Advisors Inc. ADV now owns 7,489 shares of the construction company’s stock worth $1,085,000 after acquiring an additional 2,890 shares during the period. Mackenzie Financial Corp increased its holdings in shares of Advanced Drainage Systems by 0.5% in the 4th quarter. Mackenzie Financial Corp now owns 207,922 shares of the construction company’s stock worth $30,494,000 after acquiring an additional 1,010 shares during the period. Yaupon Capital Management LP acquired a new stake in shares of Advanced Drainage Systems in the 4th quarter worth about $5,811,000. Finally, Wellington Management Group LLP increased its holdings in shares of Advanced Drainage Systems by 6.3% in the 4th quarter. Wellington Management Group LLP now owns 1,264,156 shares of the construction company’s stock worth $183,088,000 after acquiring an additional 75,250 shares during the period. 89.83% of the stock is owned by institutional investors and hedge funds.

Analysts Set New Price Targets

A number of research firms have commented on WMS. Oppenheimer reiterated an “outperform” rating and set a $195.00 price objective (down from $200.00) on shares of Advanced Drainage Systems in a research note on Friday, April 17th. Royal Bank Of Canada reiterated an “outperform” rating on shares of Advanced Drainage Systems in a research note on Friday. Barclays reduced their price objective on shares of Advanced Drainage Systems from $198.00 to $181.00 and set an “overweight” rating on the stock in a research note on Wednesday, April 8th. UBS Group set a $215.00 price objective on shares of Advanced Drainage Systems and gave the company a “buy” rating in a research note on Friday, February 6th. Finally, KeyCorp increased their price objective on shares of Advanced Drainage Systems from $180.00 to $198.00 and gave the company an “overweight” rating in a research note on Friday, February 6th. Five analysts have rated the stock with a Buy rating and one has given a Hold rating to the company. According to MarketBeat, the stock currently has a consensus rating of “Moderate Buy” and an average price target of $199.83.

About Advanced Drainage Systems

Advanced Drainage Systems, Inc (NYSE: WMS) is a leading manufacturer and supplier of water management solutions in North America. Headquartered in Hilliard, Ohio, the company specializes in the design, production and distribution of high-density polyethylene (HDPE) drainage pipe and related products. Its core business addresses stormwater management, on-site septic systems and erosion control for residential, commercial and infrastructure projects.

The company’s product portfolio includes corrugated plastic pipe, tubing, fittings, geocells, geogrids and stormwater structures such as inlets, manholes and detention/retention systems.