Advanced Drainage Systems (NYSE:WMS) Announces Earnings Results, Beats Estimates By $0.16 EPS

Posted by Joseph Griffin on Feb 5th, 2026

Advanced Drainage Systems (NYSE:WMS – Get Free Report) posted its quarterly earnings data on Thursday. The construction company reported $1.27 earnings per share (EPS) for the quarter, topping the consensus estimate of $1.11 by $0.16, FiscalAI reports. Advanced Drainage Systems had a return on equity of 28.85% and a net margin of 15.35%.The company had revenue of $693.35 million for the quarter, compared to analysts’ expectations of $686.37 million. During the same period in the previous year, the firm posted $1.09 EPS. Advanced Drainage Systems’s revenue was up .4% compared to the same quarter last year.

Here are the key takeaways from Advanced Drainage Systems’ conference call:

ADS reported one of its most profitable Q3s with a 30.2% adjusted EBITDA margin and a 9% increase in adjusted EBITDA despite flat revenue, driven by allied products, Infiltrator, HP Pipe gains and cost?improvement programs.
The company closed the NDS acquisition (included as ~$40M revenue in Q4 at ~20% EBITDA margin) and expects roughly $25M of annual cost synergies by year three, with integration work and synergy details to be discussed at Investor Day.
Management raised fiscal 2026 guidance to a revenue midpoint of $3.015B and an adjusted EBITDA midpoint of $945M (31.1–31.6% margin), noting the update already factors in NDS and recent storm impacts.
Strong cash generation (YTD operating cash of $779M), a cash balance above $1B, pro forma leverage of ~1.5x after NDS, and a new $1B repurchase authorization (totaling $1.148B) support capital flexibility while prioritizing organic investment.
Management trimmed its non?residential in?market demand outlook to down low?to?mid single digits, highlighted ongoing residential weakness (especially DIY), and warned that Q4 results are highly variable and could be choppier due to severe winter storms.

Advanced Drainage Systems Trading Up 7.2%

Shares of WMS stock traded up $11.61 during mid-day trading on Thursday, reaching $171.87. The company’s stock had a trading volume of 1,059,213 shares, compared to its average volume of 714,653. The company’s 50 day simple moving average is $151.81 and its 200-day simple moving average is $143.12. The company has a quick ratio of 2.60, a current ratio of 3.48 and a debt-to-equity ratio of 0.75. Advanced Drainage Systems has a 12-month low of $93.92 and a 12-month high of $173.75. The firm has a market capitalization of $13.36 billion, a PE ratio of 29.33, a price-to-earnings-growth ratio of 2.03 and a beta of 1.34.

Insider Activity

In other Advanced Drainage Systems news, insider Tim A. Makowski sold 4,901 shares of the firm’s stock in a transaction dated Wednesday, November 12th. The shares were sold at an average price of $149.21, for a total value of $731,278.21. Following the transaction, the insider owned 2,467 shares of the company’s stock, valued at $368,101.07. This trade represents a 66.52% decrease in their ownership of the stock. The sale was disclosed in a legal filing with the SEC, which is available at this link. Also, Director Robert M. Eversole sold 10,569 shares of Advanced Drainage Systems stock in a transaction dated Wednesday, December 3rd. The shares were sold at an average price of $152.82, for a total transaction of $1,615,154.58. Following the completion of the sale, the director owned 50,076 shares in the company, valued at approximately $7,652,614.32. This represents a 17.43% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. Over the last quarter, insiders sold 97,772 shares of company stock worth $14,605,539. Corporate insiders own 1.63% of the company’s stock.

Institutional Inflows and Outflows

A number of large investors have recently modified their holdings of the business. Northwestern Mutual Wealth Management Co. grew its position in Advanced Drainage Systems by 352.0% in the 2nd quarter. Northwestern Mutual Wealth Management Co. now owns 226 shares of the construction company’s stock valued at $26,000 after buying an additional 176 shares in the last quarter. Baird Financial Group Inc. lifted its stake in shares of Advanced Drainage Systems by 1.8% in the 2nd quarter. Baird Financial Group Inc. now owns 21,049 shares of the construction company’s stock worth $2,418,000 after acquiring an additional 382 shares during the period. Brown Advisory Inc. boosted its holdings in shares of Advanced Drainage Systems by 14.0% in the second quarter. Brown Advisory Inc. now owns 4,784 shares of the construction company’s stock valued at $549,000 after acquiring an additional 588 shares in the last quarter. Jump Financial LLC acquired a new position in shares of Advanced Drainage Systems during the second quarter valued at approximately $403,000. Finally, California Public Employees Retirement System raised its holdings in Advanced Drainage Systems by 2.2% during the second quarter. California Public Employees Retirement System now owns 101,512 shares of the construction company’s stock worth $11,660,000 after purchasing an additional 2,206 shares in the last quarter. 89.83% of the stock is owned by institutional investors and hedge funds.

Key Headlines Impacting Advanced Drainage Systems

Here are the key news stories impacting Advanced Drainage Systems this week:

Positive Sentiment: Q3 earnings and revenue beat consensus — EPS of $1.27 topped estimates of $1.11 and revenue of $693.4M beat the ~$686M consensus; net income rose ~14% year-over-year, supporting the upside reaction. Advanced Drainage Systems (WMS) Tops Q3 Earnings and Revenue Estimates
Positive Sentiment: Board increased capital returns — a 13% raise in the quarterly cash dividend to $0.18/sh and an increased stock repurchase authorization signal confidence in cash flow and support buyback-driven EPS accretion. Advanced Drainage Systems Announces Quarterly Cash Dividend Advanced Drainage Systems Announces Third-Quarter Fiscal 2026 Results, Increases Stock Repurchase Authorization
Neutral Sentiment: Investor materials and commentary available — press release, slide deck and conference-call transcript are posted (useful for digging into margin drivers, channel trends and backlog). Listen to Conference Call / View Press Release / Slide Deck
Neutral Sentiment: Analyst write-ups dig into underlying metrics beyond headline EPS — useful context for institutional investors evaluating sustainability of margins and FY26 outlook assumptions. Compared to Estimates, Advanced Drainage (WMS) Q3 Earnings: A Look at Key Metrics
Negative Sentiment: Top-line growth remains tepid — revenue rose only ~0.4% vs. last year, and the company’s FY26 guidance in reports was unclear/misaligned in some releases, which could create short-term uncertainty until management provides clearer forward guidance. Advanced Drainage (WMS) Q4 Earnings Report Preview: What To Look For

Wall Street Analysts Forecast Growth

A number of research analysts have weighed in on the company. Oppenheimer raised their price objective on Advanced Drainage Systems from $175.00 to $180.00 and gave the company an “outperform” rating in a report on Thursday, January 15th. KeyCorp increased their price target on Advanced Drainage Systems from $170.00 to $180.00 and gave the stock an “overweight” rating in a report on Monday, January 26th. Weiss Ratings reaffirmed a “hold (c)” rating on shares of Advanced Drainage Systems in a research report on Wednesday, January 21st. Royal Bank Of Canada restated an “outperform” rating and set a $176.00 target price on shares of Advanced Drainage Systems in a research note on Thursday, January 15th. Finally, Barclays upped their price target on Advanced Drainage Systems from $181.00 to $187.00 and gave the company an “overweight” rating in a report on Thursday, January 15th. Eight research analysts have rated the stock with a Buy rating and two have assigned a Hold rating to the company. According to MarketBeat, the stock has an average rating of “Moderate Buy” and an average price target of $165.33.

Read Our Latest Report on WMS

About Advanced Drainage Systems

(Get Free Report)

Advanced Drainage Systems, Inc (NYSE: WMS) is a leading manufacturer and supplier of water management solutions in North America. Headquartered in Hilliard, Ohio, the company specializes in the design, production and distribution of high-density polyethylene (HDPE) drainage pipe and related products. Its core business addresses stormwater management, on-site septic systems and erosion control for residential, commercial and infrastructure projects.

The company’s product portfolio includes corrugated plastic pipe, tubing, fittings, geocells, geogrids and stormwater structures such as inlets, manholes and detention/retention systems.