The business behind the dividend
| Measure | AOS | Median | Formula |
|---|---|---|---|
| Return on equity | 29.4% | 10.6% | Net income ÷ shareholders’ equity |
| Return on capital employed | 36.2% | 10.0% | Operating income ÷ (equity + total debt) |
| Owner earnings | $560.50m | $120.90m | Net income + depreciation & amortisation − capital expenditure |
| Free cash flow | $546.00m | $155.08m | Operating cash flow − capital expenditure |
| Operating margin | 19.0% | 14.3% | Operating income ÷ revenue |
| Net margin | 14.3% | 10.1% | Net income ÷ revenue |
| Debt to equity | 0.08x | 0.73x | Total debt ÷ shareholders’ equity |
| Interest cover | 53.97x | 4.22x | Operating income ÷ interest expense |
| Current ratio | 1.50x | 1.55x | Current assets ÷ current liabilities |
| Long-term debt to working capital | 0.26x | 1.88x | Long-term debt ÷ (current assets − current liabilities) |
| Cash conversion | 1.13x | 1.66x | Operating cash flow ÷ net income |
| Accruals | -2.2% | -3.1% | (Net income − operating cash flow) ÷ total assets |
Ten years of it
The same measures, for every year the filings support. One year is a fact; a row is a business.
| Measure | 2025 | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | 2016 | Median |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Return on equity | 29.4% | 28.3% | 30.2% | 13.5% | 26.6% | 18.7% | 22.2% | 25.9% | 18.0% | 21.6% | 22.2% |
| Return on capital employed | 36.2% | 34.1% | 37.8% | 17.3% | 33.6% | 25.7% | 27.1% | 31.6% | 28.1% | 28.1% | 28.1% |
| Operating margin | 19.0% | 18.5% | 19.3% | 9.6% | 19.3% | 17.4% | 17.7% | 19.2% | 19.3% | 19.2% | 19.0% |
| Net margin | 14.3% | 14.0% | 14.4% | 6.3% | 13.8% | 11.9% | 12.4% | 13.9% | 9.9% | 12.2% | 12.4% |
| Debt to equity | 0.08x | 0.10x | 0.07x | 0.20x | 0.11x | 0.06x | 0.17x | 0.13x | 0.25x | 0.21x | 0.11x |
| Current ratio | 1.50x | 1.55x | 1.59x | 1.75x | 1.57x | 1.83x | 1.96x | 2.09x | 2.23x | 2.04x | 1.75x |
| Cash conversion | 1.13x | 1.09x | 1.20x | 1.66x | 1.32x | 1.63x | 1.23x | 1.01x | 1.10x | 1.37x | 1.20x |
How it compares in consumer discretionary
Among the 169 consumer discretionary companies here measured on free cash flow, Smith A O pays out less than 78 of them. The median for that group is 33.1%, against this company’s 35.8%.
Closest on free cash flow
- Cintas (CTAS) 34.8%
- Sunbelt Rentals Holdings (SUNB) 34.9%
- Hyatt Hotels (H) 35.8%
- Upbound Group (UPBD) 36.8%
Same sector and same denominator, so the figures are comparable. All 197 in consumer discretionary →