📊 WMS Key Takeaways
Is Advanced Drainage Systems, Inc.. (WMS) a Good Investment?
Advanced Drainage Systems demonstrates exceptional cash generation with $569M free cash flow (18.7% FCF margin) and strong operational profitability (20.3% operating margin, 22.9% ROE). The balance sheet is healthy with conservative leverage (0.88x Debt/Equity) and excellent liquidity (2.42x current ratio). However, the recent profitability decline (-0.5% net income YoY, -5.6% EPS YoY) despite 5% revenue growth signals margin compression requiring close monitoring.
Advanced Drainage Systems, Inc.. Key Strengths (WMS)
- Exceptional free cash flow generation of $569.3M with 18.7% FCF margin demonstrates strong capital efficiency and operational quality
- Outstanding return on equity of 22.9% paired with 20.3% operating margin indicates competitive advantages and strong market positioning
- Healthy balance sheet with 2.42x current ratio, 1.35x quick ratio, and moderate 0.88x debt-to-equity provides financial flexibility
- Consistent 5% revenue growth in a mature industrial segment suggests pricing power or market share gains
- Robust gross margins of 38.3% indicate differentiation or cost leadership in plastics/foam products
WMS Stock Risks: Advanced Drainage Systems, Inc.. Investment Risks
- Profitability decline (-0.5% net income, -5.6% EPS YoY) despite revenue growth signals margin compression from input costs or operational challenges
- Long-term debt of $1.6B in higher rate environment presents refinancing and interest expense risk
- Cyclical exposure to construction and infrastructure markets creates vulnerability to economic downturns and capital spending pullbacks
- 12 Form 4 filings in 90 days warrant monitoring for insider trading patterns and management confidence signals
Key Metrics to Watch
- Operating margin trend and gross margin recovery—critical to confirm margin compression is temporary
- Free cash flow sustainability and cash conversion rate relative to net income
- Debt service capacity and leverage ratios as interest rate environment evolves
- Revenue growth acceleration—sustaining above 5% would validate market strength
- Capital expenditure efficiency and return on incremental capex investments
Advanced Drainage Systems, Inc.. (WMS) Financial Metrics & Key Ratios
💡 AI Analyst Insight
Strong liquidity with a 2.42x current ratio provides a solid financial cushion.
WMS Profit Margin, ROE & Profitability Analysis
WMS vs Materials Sector: How Advanced Drainage Systems, Inc.. Compares
How Advanced Drainage Systems, Inc.. compares to Materials sector averages
Sector benchmarks are approximate industry averages. Actual sector performance may vary.
Is Advanced Drainage Systems, Inc.. Stock Overvalued? WMS Valuation Analysis 2026
Based on fundamental analysis, Advanced Drainage Systems, Inc.. has mixed fundamental signals relative to the Materials sector in 2026.
Note: This is a fundamental analysis based on SEC filings. For P/E ratio, price targets, and market-based valuation, consult financial data providers. This is not investment advice.
Advanced Drainage Systems, Inc.. Balance Sheet: WMS Debt, Cash & Liquidity
WMS Revenue & Earnings Growth: 5-Year Financial Trend
5-Year Trend Summary: Advanced Drainage Systems, Inc..'s revenue has grown significantly by 10% over the 5-year period, indicating strong business expansion. The most recent EPS of $6.45 reflects profitable operations.
WMS Revenue Growth, EPS Growth & YoY Performance
WMS Quarterly Earnings & Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q3 2025 | $662.4M | $81.2M | $1.04 |
| Q2 2025 | $780.2M | $130.4M | $1.67 |
| Q1 2025 | $815.3M | $143.9M | $1.84 |
| Q1 2024 | $778.0M | $161.4M | $2.06 |
| Q3 2023 | $655.2M | $73.7M | $0.86 |
| Q2 2023 | $706.5M | $75.4M | $0.88 |
| Q1 2023 | $669.3M | $76.0M | $0.87 |
| Q1 2022 | $508.6M | $70.5M | $0.83 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
Advanced Drainage Systems, Inc.. Dividends, Buybacks & Capital Allocation
WMS SEC Filings: Latest 10-K & 10-Q Analysis
Access official SEC EDGAR filings for Advanced Drainage Systems, Inc.. (CIK: 0001604028)
📋 Recent SEC Filings
❓ Frequently Asked Questions about WMS
What is the AI rating for WMS?
Advanced Drainage Systems, Inc.. (WMS) has an AI grade of A with 78% confidence, based on fundamental analysis of SEC EDGAR filings.
What are WMS's key strengths?
Claude: Exceptional free cash flow generation of $569.3M with 18.7% FCF margin demonstrates strong capital efficiency and operational quality. Outstanding return on equity of 22.9% paired with 20.3% operating margin indicates competitive advantages and strong market positioning.
What are the risks of investing in WMS?
Claude: Profitability decline (-0.5% net income, -5.6% EPS YoY) despite revenue growth signals margin compression from input costs or operational challenges. Long-term debt of $1.6B in higher rate environment presents refinancing and interest expense risk.
What is WMS's revenue and growth?
Advanced Drainage Systems, Inc.. reported revenue of $3.1B.
Does WMS pay dividends?
Advanced Drainage Systems, Inc.. pays dividends, with $56.1M distributed to shareholders in the trailing twelve months.
Where can I find WMS SEC filings?
Official SEC filings for Advanced Drainage Systems, Inc.. (CIK: 0001604028) including 10-K, 10-Q, and 8-K reports are available on SEC EDGAR.
What is WMS's EPS?
Advanced Drainage Systems, Inc.. has a diluted EPS of $5.44.
How is the AI analysis conducted?
Two independent AI systems — Claude (Anthropic) and ChatGPT (OpenAI) — analyze SEC EDGAR filings including 10-K annual reports and 10-Q quarterly reports. Each AI evaluates financial health, profitability ratios, balance sheet strength, and growth metrics. The combined grade reflects both perspectives for balanced insights.
What is WMS's fundamental grade?
Based on our AI fundamental analysis in June 2026, Advanced Drainage Systems, Inc.. has a A grade with 78% confidence. The AI analysis suggests favorable fundamentals based on SEC filings. This is not investment advice.
Is WMS stock overvalued or undervalued?
Valuation metrics for WMS: ROE of 22.9% (sector avg: 14%), net margin of 14.0% (sector avg: 10%). Higher ROE suggests strong returns relative to peers.
What is WMS's AI grade for 2026?
Our dual AI analysis gives Advanced Drainage Systems, Inc.. a combined A grade for 2026. Revenue is data pending, with profitability above sector average. Always conduct your own research.
What is WMS's free cash flow?
Advanced Drainage Systems, Inc..'s operating cash flow is $819.1M, with capital expenditures of $249.8M. FCF margin is 18.7%.
How does WMS compare to other Materials stocks?
Vs Materials sector averages: Net margin 14.0% (avg: 10%), ROE 22.9% (avg: 14%), current ratio 2.42 (avg: 1.6).