Zurn Elkay Water Solutions Q1 2026 Earnings Call Insights
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1 day ago
0mins
Should l Buy ZWS?
Source: seekingalpha
- Strong Sales Growth: Zurn Elkay reported Q1 2026 sales of $433 million, reflecting an 11% year-over-year increase, indicating robust performance in non-residential markets despite some softness in residential sectors, thus maintaining overall growth momentum.
- Improved Profitability: Adjusted EBITDA reached $116 million with a margin expansion of 160 basis points to 26.8% year-over-year, driven by productivity initiatives and rapid growth in higher-margin products, enhancing the company's competitive position in the market.
- Cash Flow and Capital Structure Optimization: The company generated $43 million in free cash flow during Q1 and successfully increased its credit facility from $200 million to $550 million, demonstrating strong liquidity and capital management capabilities that secure future investments.
- Optimistic Future Outlook: Zurn Elkay projects Q2 2026 core sales growth of 8% to 9% and an adjusted EBITDA margin between 27% and 27.5%, with management expressing confidence in future profitability and market demand, although potential tariff refund benefits are not included in their outlook.
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Analyst Views on ZWS
Wall Street analysts forecast ZWS stock price to rise
7 Analyst Rating
3 Buy
4 Hold
0 Sell
Moderate Buy
Current: 52.480
Low
50.00
Averages
55.83
High
59.00
Current: 52.480
Low
50.00
Averages
55.83
High
59.00
About ZWS
Zurn Elkay Water Solutions Corporation specializes in water solutions for health, hydration, human safety and the environment. Its product portfolio includes professional grade water safety and control products, flow systems products, hygienic and environmental products and filtered drinking water products for public and private spaces. Its drinking water product line includes a collection of filtered drinking water delivery products. Its water safety and control products encompass a range of valve and water distribution control products. Its flow systems products are commonly installed within a building or on a site to manage storm water and wastewater. Its hygienic and environmental products include primarily sensor-operated flush valves, heavy-duty commercial faucets, and flush valves and faucets. Its products are marketed and sold under various brand names, including Zurn, Elkay, Wilkins, Green Turtle, World Dryer, StainlessDrains.com, JUST, Hadrian, Wade, and Halsey Taylor.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Zurn Elkay Water Solutions Reports Strong Q1 Performance with 11% Organic Growth
- Organic Sales Growth: Zurn Elkay Water Solutions Corp achieved an 11% organic sales growth in Q1 2026, totaling $433 million in sales, reflecting strong market performance despite softness in residential markets.
- Significant EBITDA Growth: The company reported an 18% increase in EBITDA to $116 million, with EBITDA margins expanding to 26.8%, which not only enhances profitability but also boosts investor confidence in the company's future growth prospects.
- Free Cash Flow and Share Buybacks: In the first quarter, Zurn Elkay generated $43 million in free cash flow and repurchased $50 million worth of shares at approximately $47 per share, indicating a robust capital management strategy that enhances shareholder value.
- Enhanced Liquidity: Zurn Elkay successfully upsized its revolver from $200 million to $550 million, extending it for five years, which strengthens the company's liquidity and ensures flexibility to navigate potential challenges in an uncertain market environment.
See More
Zurn Elkay Reports Strong Q1 Results Exceeding Expectations
- Significant Revenue Growth: Zurn Elkay reported Q1 2026 revenue of $433 million, an 11.4% year-over-year increase that surpassed analyst expectations of $419.5 million, indicating robust performance in the water management solutions sector.
- Improved Profitability: The adjusted EPS of $0.41 exceeded analysts' forecast of $0.36 by 13%, while adjusted EBITDA reached $116 million with a 26.8% margin, reflecting the company's successful shift towards higher-margin products.
- Optimized Product Mix: The company's product mix has shifted to an even split between new construction and retrofit/replacement, enhancing resilience and margin potential, as retrofit products typically yield higher returns and recurring demand, supporting future steady growth.
- Positive Outlook: Management expresses confidence in future prospects, planning new product launches in the second half of the year, with expectations that ongoing growth in retrofit segments will support revenue and margin expansion, while remaining cautious of external market volatility.
See More
Zurn Elkay Water Solutions Q1 2026 Earnings Call Insights
- Strong Sales Growth: Zurn Elkay reported Q1 2026 sales of $433 million, reflecting an 11% year-over-year increase, indicating robust performance in non-residential markets despite some softness in residential sectors, thus maintaining overall growth momentum.
- Improved Profitability: Adjusted EBITDA reached $116 million with a margin expansion of 160 basis points to 26.8% year-over-year, driven by productivity initiatives and rapid growth in higher-margin products, enhancing the company's competitive position in the market.
- Cash Flow and Capital Structure Optimization: The company generated $43 million in free cash flow during Q1 and successfully increased its credit facility from $200 million to $550 million, demonstrating strong liquidity and capital management capabilities that secure future investments.
- Optimistic Future Outlook: Zurn Elkay projects Q2 2026 core sales growth of 8% to 9% and an adjusted EBITDA margin between 27% and 27.5%, with management expressing confidence in future profitability and market demand, although potential tariff refund benefits are not included in their outlook.
See More
Zurn Elkay Water Solutions Q1 Earnings Exceed Expectations
- Earnings Beat: Zurn Elkay Water Solutions reported a Q1 Non-GAAP EPS of $0.41, exceeding expectations by $0.05, which highlights the company's strong profitability and boosts investor confidence.
- Significant Revenue Growth: The company achieved Q1 revenue of $433 million, reflecting an 11.3% year-over-year increase and surpassing market expectations by $14.07 million, indicating sustained demand in the water solutions sector.
- Optimistic Outlook: Zurn Elkay anticipates core sales growth of 8% to 9% in Q2, which not only reflects positive market demand expectations but also positions the company to strengthen its market position in a competitive industry.
- Stable Profitability: The adjusted EBITDA margin is projected to be between 27.0% and 27.5%, demonstrating ongoing improvements in cost control and operational efficiency, which contribute to the overall financial health of the company.
See More
Zurn Elkay Earnings Preview: 9.8% Revenue Growth
- Revenue Beat: Zurn Elkay reported last quarter's revenues of $407.2 million, reflecting a 9.8% year-over-year increase, which not only surpassed analyst expectations but also demonstrated the company's strong performance in water management solutions, boosting market confidence.
- Optimistic Market Expectations: This quarter, the market anticipates Zurn Elkay's revenue to grow by 7.9% year-over-year, an improvement from the 4% increase recorded in the same quarter last year, indicating the company's ongoing growth potential in the industry.
- Analyst Sentiment Turns Positive: Over the past 30 days, analysts have generally revised their revenue estimates upward for Zurn Elkay, reflecting confidence in the company's future performance, as it has a history of exceeding Wall Street expectations.
- Peer Comparison: In the building products sector, Zurn Elkay's peer Insteel reported only 7.5% revenue growth and saw its stock drop by 28.2%, while Zurn Elkay's stock rose by 5.8% during the same period, showcasing its relatively strong market performance.
See More
Zurn Elkay Releases 2025 Sustainability Report Highlighting Environmental Progress
- Plastic Bottle Recycling Achievement: In 2025, Zurn Elkay successfully prevented 20 billion plastic bottles from entering waterways and landfills, significantly reducing environmental pollution and enhancing the company's leadership position in sustainability.
- Contribution to Clean Drinking Water: The company provided 2.4 billion gallons of cleaner, safer drinking water through its commercial-grade filters in schools, hospitals, and public spaces, addressing growing public health needs while enhancing brand image and market competitiveness.
- Filtration Technology Innovation: Zurn Elkay launched a new water filter capable of effectively reducing contaminants like PFAS, further solidifying its technological advantage in water safety, and improved facility water treatment efficiency with the Elkay Pro Filtration line.
- Strengthened Environmental Responsibility: The company set a new goal to reduce water withdrawal intensity by 3% by 2030 and partnered with TerraCycle to introduce a filter recycling program, demonstrating its long-term commitment to environmental management and sustainability.
See More
Zurn Elkay Water Solutions Reports Strong Q1 Performance with 11% Organic Growth
- Organic Sales Growth: Zurn Elkay Water Solutions Corp achieved an 11% organic sales growth in Q1 2026, totaling $433 million in sales, reflecting strong market performance despite softness in residential markets.
- Significant EBITDA Growth: The company reported an 18% increase in EBITDA to $116 million, with EBITDA margins expanding to 26.8%, which not only enhances profitability but also boosts investor confidence in the company's future growth prospects.
- Free Cash Flow and Share Buybacks: In the first quarter, Zurn Elkay generated $43 million in free cash flow and repurchased $50 million worth of shares at approximately $47 per share, indicating a robust capital management strategy that enhances shareholder value.
- Enhanced Liquidity: Zurn Elkay successfully upsized its revolver from $200 million to $550 million, extending it for five years, which strengthens the company's liquidity and ensures flexibility to navigate potential challenges in an uncertain market environment.
See More
Zurn Elkay Reports Strong Q1 Results Exceeding Expectations
- Significant Revenue Growth: Zurn Elkay reported Q1 2026 revenue of $433 million, an 11.4% year-over-year increase that surpassed analyst expectations of $419.5 million, indicating robust performance in the water management solutions sector.
- Improved Profitability: The adjusted EPS of $0.41 exceeded analysts' forecast of $0.36 by 13%, while adjusted EBITDA reached $116 million with a 26.8% margin, reflecting the company's successful shift towards higher-margin products.
- Optimized Product Mix: The company's product mix has shifted to an even split between new construction and retrofit/replacement, enhancing resilience and margin potential, as retrofit products typically yield higher returns and recurring demand, supporting future steady growth.
- Positive Outlook: Management expresses confidence in future prospects, planning new product launches in the second half of the year, with expectations that ongoing growth in retrofit segments will support revenue and margin expansion, while remaining cautious of external market volatility.
See More
Zurn Elkay Water Solutions Q1 2026 Earnings Call Insights
- Strong Sales Growth: Zurn Elkay reported Q1 2026 sales of $433 million, reflecting an 11% year-over-year increase, indicating robust performance in non-residential markets despite some softness in residential sectors, thus maintaining overall growth momentum.
- Improved Profitability: Adjusted EBITDA reached $116 million with a margin expansion of 160 basis points to 26.8% year-over-year, driven by productivity initiatives and rapid growth in higher-margin products, enhancing the company's competitive position in the market.
- Cash Flow and Capital Structure Optimization: The company generated $43 million in free cash flow during Q1 and successfully increased its credit facility from $200 million to $550 million, demonstrating strong liquidity and capital management capabilities that secure future investments.
- Optimistic Future Outlook: Zurn Elkay projects Q2 2026 core sales growth of 8% to 9% and an adjusted EBITDA margin between 27% and 27.5%, with management expressing confidence in future profitability and market demand, although potential tariff refund benefits are not included in their outlook.
See More
Zurn Elkay Water Solutions Q1 Earnings Exceed Expectations
- Earnings Beat: Zurn Elkay Water Solutions reported a Q1 Non-GAAP EPS of $0.41, exceeding expectations by $0.05, which highlights the company's strong profitability and boosts investor confidence.
- Significant Revenue Growth: The company achieved Q1 revenue of $433 million, reflecting an 11.3% year-over-year increase and surpassing market expectations by $14.07 million, indicating sustained demand in the water solutions sector.
- Optimistic Outlook: Zurn Elkay anticipates core sales growth of 8% to 9% in Q2, which not only reflects positive market demand expectations but also positions the company to strengthen its market position in a competitive industry.
- Stable Profitability: The adjusted EBITDA margin is projected to be between 27.0% and 27.5%, demonstrating ongoing improvements in cost control and operational efficiency, which contribute to the overall financial health of the company.
See More
Zurn Elkay Earnings Preview: 9.8% Revenue Growth
- Revenue Beat: Zurn Elkay reported last quarter's revenues of $407.2 million, reflecting a 9.8% year-over-year increase, which not only surpassed analyst expectations but also demonstrated the company's strong performance in water management solutions, boosting market confidence.
- Optimistic Market Expectations: This quarter, the market anticipates Zurn Elkay's revenue to grow by 7.9% year-over-year, an improvement from the 4% increase recorded in the same quarter last year, indicating the company's ongoing growth potential in the industry.
- Analyst Sentiment Turns Positive: Over the past 30 days, analysts have generally revised their revenue estimates upward for Zurn Elkay, reflecting confidence in the company's future performance, as it has a history of exceeding Wall Street expectations.
- Peer Comparison: In the building products sector, Zurn Elkay's peer Insteel reported only 7.5% revenue growth and saw its stock drop by 28.2%, while Zurn Elkay's stock rose by 5.8% during the same period, showcasing its relatively strong market performance.
See More
Zurn Elkay Releases 2025 Sustainability Report Highlighting Environmental Progress
- Plastic Bottle Recycling Achievement: In 2025, Zurn Elkay successfully prevented 20 billion plastic bottles from entering waterways and landfills, significantly reducing environmental pollution and enhancing the company's leadership position in sustainability.
- Contribution to Clean Drinking Water: The company provided 2.4 billion gallons of cleaner, safer drinking water through its commercial-grade filters in schools, hospitals, and public spaces, addressing growing public health needs while enhancing brand image and market competitiveness.
- Filtration Technology Innovation: Zurn Elkay launched a new water filter capable of effectively reducing contaminants like PFAS, further solidifying its technological advantage in water safety, and improved facility water treatment efficiency with the Elkay Pro Filtration line.
- Strengthened Environmental Responsibility: The company set a new goal to reduce water withdrawal intensity by 3% by 2030 and partnered with TerraCycle to introduce a filter recycling program, demonstrating its long-term commitment to environmental management and sustainability.
See More
