Zurn Elkay Water Solutions Corporation (ZWS) Fundamental Analysis: Bull vs. Bear Case

ZWS

Zurn Elkay Water Solutions Corporation

Fundamental data last updated:August 9, 2026

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company profile

SECTOR

Industrials

industry

Industrial - Pollution & Treatment Controls

Exchange

NYSE

County of HQ

US

Next Earnings Date

Pending Announcement

Business Summary

Zurn Elkay Water Solutions Corporation designs, procures, manufactures, and markets water system solutions that provide and enhance water quality, safety, flow control, and conservation in and around non-residential buildings. It offers finish plumbing, drainage and interceptors, water control and backflow, fire protection, PEX pipe fittings and accessories, and repair parts under the Zurn brand name; and hand and hair dryers, and baby changing stations under the World Dryer brand name. The company also offers stainless steel products under the Just Manufacturing brand name, which include stainless steel sinks for classrooms and academic institutions; ADA commercial stainless-steel sinks and plumbing fixtures for assisted living; faucets, bubblers, drains, and accessories; and stainless steel fixtures and related products for food services, government, healthcare, hospitality, institutional, and residential markets. It serves higher education, healthcare, retail, restaurant, hospitality, education, government, and fire protection markets. The company was formerly known as Zurn Water Solutions Corporation. Zurn Elkay Water Solutions Corporation was incorporated in 2006 and is headquartered in Milwaukee, Wisconsin.

VALUATION

P/E

37.43 Market Cap ($M USD)

$7.98B

Forward P/E

20.79 PEG

0.26 PRICE TO SALES

4.58 PRICE TO BOOK

4.97 EV / EBITDA

22.23 5-Year Average P/E

Free Cash Flow Yield

4.02%

DCF Value

$56.50

Graham Number

$16.56

Price to FCF

24.87 EV to FCF

25.69 Earnings Yield

2.67%

FCF Yield

4.02%

DIVIDEND

Yield

0.88%

Annual Payout

$0.42

Payout Ratio

31.46%

Consecutive Years of Dividend Growth

5-Year Dividend Growth Rate

Financial Health & Profitability

Earnings Per Share

$1.27

Next Year EPS Growth Estimate

$2.29

Next Year Revenue Growth Estimate

$2.16B

Return on Equity (ROE)

13.40%

FREE CASH FLOW

Operating Margin

17.45%

Debt-to-Equity

0.36 Piotroski F-Score

8 Altman Z-Score

5.13 Return on Invested Capital (ROIC)

12.51%

Current Ratio

3.24 Quick Ratio

2.11 Net Debt to EBITDA

0.71 Interest Coverage

11.04 Gross Profit margin

43.69%

FCF PER SHARE

$1.91

REVENUE PER SHARE

$10.38

Gainseekers Quantitative Analysis

Summary

Zurn Elkay Water Solutions Corporation’s valuation presents a mixed picture. The stock has traded below its DCF value, suggesting potential undervaluation. However, a Price/Earnings ratio over 40 indicates the market has high expectations for growth, which is somewhat tempered by a more reasonable Forward P/E of 22.35. The Altman Z-score of 5.47 underscores financial stability, while a low Earnings Yield of 2.48% raises questions about immediate income potential. Overall, the market seems to be pricing in robust future growth, but the current valuation may not offer a significant margin of safety.

AI Exposure / Tech Reliance

Operating in the Industrial - Pollution & Treatment Controls sector, Zurn Elkay is well-positioned to leverage AI and modern technology to enhance operational efficiency. The industry’s focus on sustainability and pollution control aligns with tech-driven innovations, potentially boosting the company's adaptability. As AI continues to evolve, Zurn Elkay could capitalize on these advancements to optimize its processes and product offerings.

The Bull Case

For the value or GARP investor, Zurn Elkay offers compelling reasons to buy. A strong ROIC of 12.51% indicates efficient capital use, while a Piotroski F-Score of 8 suggests solid financial health. The company's operating margin of 17.45% reflects pricing power, and a respectable FCF Yield, despite being modest, points to a disciplined cash flow management. These metrics collectively paint a picture of a company with robust operational efficiency and potential for sustained growth.

The Bear Case

Despite its strengths, Zurn Elkay faces significant valuation challenges. The Price/Book ratio of 5.34 and Price/Sales ratio of 4.93 suggest the stock is priced for perfection, leaving little room for error. Trading close to its 52-week high, the stock appears technically overextended, which could deter cautious investors. Additionally, a low TTM Yield of 0.78% may not satisfy income-focused investors, highlighting a potential weakness in immediate returns.

Market Sentiment & Smart Money

Short Interest %

Analyst Consensus

Hold

Average Analyst Price Target

$54.71

Institutional Ownership %

1-Year Beta

0.86 Insider Buying % (6 Mo)

Distance to 52-Week High

12.93%

Distance to 52-Week Low

26.35%

EARNINGS SURPRISE %

10.81%

50-DAY SMA

$48.16

200-DAY SMA

$47.47

⚠️ Financial Disclaimer:
This content is for informational purposes only and is not financial advice. Information may be delayed or inaccurate. We may earn a commission from partner links.