China and India Drive A. O. Smith to Record Results. Time to Buy the Stock?
There's nothing subtle about the products that underpin A. O. Smith's (NYSE: AOS) business. Take one ice-cold shower and you'll quickly appreciate how desirable the company's water heaters are. But there's an interesting story underneath all this that investors need to know. That's because the emerging markets of China and India are key to the company's growth.
North America makes up around 75% of A. O. Smith's top line. This is a mature market that is very used to having hot water available at the turn of a faucet. Although demand from the construction market isn't immaterial, the real driving force for the company is replacement sales. Simply put, if your water heater breaks, you will almost instantly get on the phone to try to get it replaced.
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Source Fool.com
