# ZWS earnings call intelligence

LOPJLB CallCard / temporal rollup · freemium · [stock page](https://www.lopjlb.com/stock/ZWS) · [Earnings tab](https://www.lopjlb.com/stock/ZWS?tab=earnings)

Updated: 2026-07-28T04:21:57

Quarters analyzed: 8

## Cross-quarter narrative

Across eight earnings calls from Q2 2024 to Q1 2026, Zurn Elkay (ZWS) shifted from modest growth to a high‑single‑digit organic sales expansion, moving from 3% core growth in mid‑2024 to 11% in Q3 2025 and maintaining double‑digit growth into 2026. Margin expansion accelerated, with EBITDA margins rising from a 370‑basis‑point uplift in Q2 2024 to a sustained 26‑27% range by 2025‑26, reflecting easing cost pressures and successful pricing actions. Free cash flow grew sharply, climbing from $80 million in Q2 2024 to over $300 million annually by FY 2025 and remaining robust in FY 2026. Leverage fell from 0.9× to 0.6×, underscoring balance‑sheet strength. The company amplified shareholder returns, introducing a $500 million buyback and a 22% dividend increase in Q3 2025. Tariff exposure was actively managed, with impacts trimmed from $45‑55 million in 2025 Q1 to roughly $50 million later, while a strategic push to cut China‑sourced cost exposure to under 3% by 2026 was launched. Product‑level milestones such as the Elkay Pro Filtration unit and PFAS filter were delivered, and sustainability reporting was upgraded. Earlier fears around residential softness, tariff volatility, supply‑chain exposure, budget‑cut risk, and M&A execution appeared in Q2 2025 but were not reiterated in subsequent calls, suggesting those concerns have receded.

## Latest CallCard · Q1

ZWS Q1: 11% organic sales growth, EBITDA +18% to $116M, margin 26.8%; Q2 guide 8-9% sales growth, 27-27.5% margin; full year FCF ~$335M; deliberate on H2 outlook, tariff impact managed.','tone': {'mgmt': 0.5, 'mgmt_rationale': 'Management highlighted strong Q1 results, confidence in tariff managemen

**Guidance:** vague

**Tone:** mgmt 0 · Q&A pressure 0 · divergence 0

## Quarter one-liners

- **2026 Q1:** ZWS Q1: 11% organic sales growth, EBITDA +18% to $116M, margin 26.8%; Q2 guide 8-9% sales growth, 27-27.5% margin; full year FCF ~$335M; deliberate on H2 outlook, tariff impact managed.','tone': {'mgmt': 0.5, 'mgmt_rationale': 'Management highlighted strong Q1 results, confidence in tariff managemen
- **2025 Q4:** ZWS delivered 10% organic sales growth in Q4 2025, EBITDA margin expanded 100bps to 25.6%, FY FCF $317M; 2026 guidance: mid-single-digit core sales growth, ~35% incremental EBITDA margins, $335M FCF; strategic plan targets adjacencies in
- **2025 Q3:** ZWS Q3: 11% organic sales growth, EBITDA margin 26.8% (+120bps), FCF $94M, raised FY guidance to ~8% core growth, $437-440M EBITDA, >$300M FCF; 2026 market seen similar to 2025. Leverage 0.6x, dividend +22%, buyback $500M. Pension terminated. Tariff costs ~$50M. Residential soft, nonresidential stab
- **2025 Q2:** Zurn Elkay posted 8% organic sales growth, expanded margins, reduced tariff impact and raised full‑year guidance while launching the new Elkay Pro Filtration unit and emphasizing strong cash flow and supply‑chain initiatives.
- **2025 Q1:** ZWS Q1: 5% organic growth, 110bps EBITDA margin expansion, affirming FY guidance; tariff impact $45-55M in 2025, China COGS to 2-3% by end-2026, price increases announced.','tone': {'mgmt': 0.5, 'mgmt_rationale': 'Management highlighted solid Q1 results, high confidence in price-cost positivity, and
- **2024 Q4:** ZWS Q4 beat guidance with 4% core growth, 8% EBITDA growth, margins up 100bps; 2025 outlook similar core growth, EBITDA $405-420M, FCF ~$290M; tariff uncertainty noted but supply chain flexibility highlighted.','tone': {'mgmt': 0.7, 'mgmt_rationale': 'Management highlighted strong Q4 and full-year r
- **2024 Q3:** —
- **2024 Q2:** Zurn Elkay Q2: 3% core growth, 20% EBITDA growth, 25.3% margin (+370bps), FCF $80M, raised FY margin expansion to 200-250bps, FCF >$250M, leverage 0.9x, share buybacks $60M.','tone': {'mgmt': 0.8, 'mgmt_rationale': 'Management highlights strong results, margin expansion, cash flow, raising outlook, 

## Theme arcs

- **Organic sales growth** (improving): Growth rose from 3% in Q2 2024 to 11% in Q3 2025 and stayed double‑digit through 2026
- **EBITDA margin expansion** (improving): Margins expanded from +370bps in Q2 2024 to a stable 26‑27% range by 2025‑26
- **Free cash flow generation** (improving): FCF grew from $80 M in Q2 2024 to >$300 M annually by FY 2025 and remained strong in FY 2026
- **Leverage reduction** (improving): Leverage fell from 0.9× to 0.6×, reflecting stronger cash generation
- **Shareholder returns** (new): Introduced $500 M buyback and 22% dividend increase in Q3 2025
- **Tariff impact management** (improving): Tariff cost impact reduced from $45‑55 M in 2025 Q1 to ~ $50 M later, with ongoing mitigation
- **China supply‑chain exposure reduction** (new): Goal set to cut exposure to <2‑3% by 2026, first disclosed in Q2 2025

## Fear persistence

- **Residential market softness** [resolved]: Cited in Q2 2025 as a potential dampener, not mentioned thereafter
- **Tariff volatility** [resolved]: Highlighted in Q2 2025; later only impact amounts reported
- **China supply‑chain exposure** [resolved]: Raised as a risk in Q2 2025, later framed as a target rather than a fear
- **End‑market budget cuts (healthcare/education)** [resolved]: Mentioned in Q2 2025, absent from later calls
- **M&A pipeline execution risk** [resolved]: Active pipeline noted in Q2 2025, no subsequent fear references

## Guidance path

2024 Q2:vague → 2024 Q3:vague → 2024 Q4:vague → 2025 Q1:vague → 2025 Q2:raised → 2025 Q3:vague → 2025 Q4:vague → 2026 Q1:vague

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Research context only. Not personalized investment advice.

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