Pentair shares rise on earnings beat, 50th dividend hike
Water treatment solutions provider raises 2026 guidance after strong Q4 performance
Pentair shares advanced in early Tuesday trading after the water treatment solutions provider reported quarterly earnings that topped analyst expectations and announced its 50th consecutive annual dividend increase.
The Minneapolis-based company reported fourth-quarter adjusted earnings per share of $1.18, exceeding the consensus estimate of $1.17 and marking a 9% increase from the prior year. Revenue for the quarter reached $1.02 billion, up 5% year-over-year and surpassing analyst projections.
According to the earnings report, Pentair generated full-year 2025 adjusted EPS of $4.92, representing 14% growth, with annual sales totaling $4.2 billion. The company produced $748 million in free cash flow, demonstrating strong operational efficiency throughout the year.
Looking ahead, Pentair issued upbeat guidance for 2026, projecting adjusted EPS between $5.25 and $5.40, representing growth of 7% to 10% above 2025 levels. The company anticipates full-year sales to increase approximately 3% to 4%. GAAP EPS is forecast in the range of $4.94 to $5.09, reflecting an increase of 26% to 30%.
"We are pleased to report a strong finish to 2025, with solid execution across our business and continued momentum in our strategic priorities," the company stated in its earnings announcement.
Pentair's board of directors declared an 8% increase to the quarterly cash dividend, raising it to $0.27 per share. The move marks the 50th consecutive year of dividend increases, placing the company among an elite group of S&P 500 companies with such lengthy dividend growth streaks. Additionally, the company confirmed it has $1 billion remaining under its share repurchase authorization, effective through December 31, 2028.
The adjusted return on sales expanded by 170 basis points to 25.2%, highlighting improved profitability despite challenging market conditions. Excluding the impact of currency translation, acquisitions, and divestitures, core sales grew 4% in the fourth quarter.
MarketBeat data shows that analysts maintain a "Moderate Buy" consensus on Pentair with an average price target of $117.47, suggesting roughly 11% upside from current levels. The stock opened at $108.05 on Tuesday and was trading at $105.64 in early afternoon activity, a modest gain of 0.26%.
Analyst sentiment has been mixed in recent weeks. Jefferies Financial Group upgraded the stock from "hold" to "buy" in December, raising its price target to $135. However, TD Cowen downgraded Pentair to "sell" in early January with a $90 target, citing concerns about near-term growth visibility and valuation. BNP Paribas also downgraded the shares to "strong sell" with a $90 price target.
The water treatment sector has attracted increased investor attention amid growing global focus on water scarcity and infrastructure needs. Pentair, with a market capitalization of approximately $17.3 billion, positions itself as a leader in providing sustainable water solutions across residential, commercial, and industrial markets.
Tuesday's earnings release also announced new executive leadership roles designed to "accelerate growth and enhance customer focus." The strategic organizational changes come as Pentair seeks to capitalize on what management sees as expanding opportunities in the global water treatment market.
With the 2026 guidance reflecting confidence in continued growth, investors will be watching whether Pentair can maintain its operational momentum and extend its remarkable dividend streak amid evolving market dynamics in the industrials sector.