Stock fact sheet · data as of
Advanced Drainage Systems, Inc. (WMS): fair value, margin of safety and Wheel Score
Basic Materials · Construction Materials · United States · Blend
Is WMS undervalued?
Advanced Drainage Systems, Inc. (WMS) closed at 125.19 on 16 Oct 2026, close to the GLS average fair value of 121.88 (2.7% above fair value). 3 of the 9 models that produced a number sit above the price, 6 below - the market and our models roughly agree. With little margin of safety either way, the case for or against the stock rests on the quality numbers and the option premium rather than on price.
There is a wide gap between DDM (11.18) and Graham Growth (267.53). When the models are this far apart the "fair value" is really a range, and the margin of safety above should be read with that range in mind.
The nightly engine files WMS under Blend.
Nine valuation models for WMS
Each model turns the latest filed numbers into a value per share; the GLS fair value is the simple average of the ones that produce a positive number. The last two rows are shown for reference and never enter the average. The Quote page lets you switch any model off and add your own margin of safety.
| Model | Value | vs price | What it measures |
|---|---|---|---|
| DCF | 117.64 | -6% | Present value of the projected free cash flows, discounted at the cost of capital |
| Graham Number | 56.83 | -55% | The most a defensive investor pays for the earnings and book value per share |
| Graham Growth | 267.53 | +114% | Graham's growth formula: EPS × (8.5 + 2 × growth), adjusted for bond yields |
| Lynch | 111.76 | -11% | EPS × the earnings growth rate (PEG of 1), growth capped at 25% |
| GLS Growth | 82.29 | -34% | EPS compounded ten years at the blended growth rate, discounted back at 15% a year |
| 10 Cap | 199.60 | +59% | Owner's earnings (operating cash flow less maintenance capex) capitalised at 10% |
| Payback Time | 184.62 | +47% | Eight years of compounded free cash flow: the price at which the business pays for itself |
| DDM | 11.18 | -91% | Dividend discount model: next year's dividend ÷ (10% − 3% growth); needs a dividend |
| EPV | 65.49 | -48% | Earnings power value: current EPS capitalised at 9% with no growth |
| Zombie (liquidation) | -17.49 | -114% | Current assets less all liabilities, per share: the balance-sheet floor. Not in the average |
| Wall St target | 188.20 | +50% | Analysts' average 12-month price target. Not in the average |
Quality and financial health
Advanced Drainage Systems, Inc. scores 6 of 9 on the Piotroski F-score: a middling result that passes the Sunday Scan's "6 or more" rule. Some of the nine tests on profitability, leverage and efficiency are failed, so the accounts are worth a look before selling a put on the name. On durability WMS scores 6.6/10 on the GLS Moat - a middle reading; the Scorecard on the Quote page's Financials tab shows which ten-year lines are steady and which are not.
Returns on capital are moderate - ROIC 11.4%, ROE 22.1%, ROA 9.5% - with debt at 0.93 times equity and a free-cash-flow yield of 5.8%.
The dividend yield is 0.61% with a payout ratio of 13% - a small yield that leaves most of the earnings in the business. Revenue comes mainly from Intersegment Eliminations 100% (quarter Q1 FY2027).
Institutional ownership scores 10/10, insider activity 1/10 and Congressional trading 5/10 on the GLS smart-money scales.
| Piotroski F-score | 6 / 9 | ROIC | 11.4% |
|---|---|---|---|
| GLS Moat | 6.6 / 10 | ROE | 22.1% |
| Debt / equity | 0.93 | ROA | 9.5% |
| Free-cash-flow yield | 5.8% | Payout ratio | 13% |
| Institutions | 10 / 10 | Insiders · Congress | 1 · 5 / 10 |
Wheel Score 72: Good
With a Wheel Score of 72 - the Good band - Advanced Drainage Systems, Inc. clears the Sunday Scan's "70 or higher" rule. The parts: Value 11/25, Health 13/20, Moat 10/15, Premium 20/20, Stability 17/20; Value (11/25) scores lowest.
Implied volatility is 47% on the near-the-money contracts 20-60 days out - inside the 35-60% range the Wheel Score pays full marks for: enough premium to be worth selling, not so much that the risk is unpaid. Chain open interest is 3,222 contracts across all expiries - enough for the wheel at normal size.
Volume runs at 758k shares a day on a market cap of $9.4B, with a beta of 1.29 - a high beta, so the stock tends to move more than the market and a strike can be gapped through; the Stability part of the Wheel Score gives that 17 of 20.
| Part | Points | From | |
|---|---|---|---|
| Value | 11 / 25 | -3% margin of safety | |
| Health | 13 / 20 | Piotroski 6/9 | |
| Moat | 10 / 15 | moat 6.6/10 | |
| Premium | 20 / 20 | implied volatility 47% | |
| Stability | 17 / 20 | 758k shares/day, $9.4B cap, beta 1.29 |
The Wheel Score ranks ~7,400 US stocks for selling cash-secured puts and covered calls; it is updated nightly and is not a recommendation. The walkthrough lesson shows how the score fits into a trade, start to finish.
Upcoming events
The next earnings report is due on 5 Nov 2026 (before the open), 20 days away; a 30-45-day put sold today would expire after it, which is worth weighing against the premium.
Earnings, dividend, IPO, split and economic calendars for the whole market, filterable to your watchlists.
Similar stocks in Construction Materials
The 12 companies below are the closest to Advanced Drainage Systems, Inc. by market cap within the Construction Materials industry, each with its own fact sheet; the Compare page puts up to eight of them side by side.
| Stock | Close | Fair value | MoS | Wheel | Mkt cap |
|---|---|---|---|---|---|
| OC Owens Corning | 113.69 | 149.84 | +24% | 45Weak | $9.0B |
| SPXC SPX Technologies, Inc. | 168.23 | 150.84 | -12% | 64Fair | $8.4B |
| ACA Arcosa, Inc. | 147.01 | 99.18 | -48% | 47Weak | $7.2B |
| AWI Armstrong World Industries, Inc. | 166.59 | 158.94 | -5% | 72Good | $7.0B |
| SSD Simpson Manufacturing Co., Inc. | 171.08 | 136.82 | -25% | 64Fair | $7.0B |
| CSL Carlisle Companies Incorporated | 335.49 | 268.81 | -25% | 59Fair | $13.3B |
| MAS Masco Corporation | 72.58 | 77.38 | +6% | 77Good | $14.3B |
| CX CEMEX, S.A.B. de C.V. | 10.06 | 32.55 | +69% | 92Prime | $14.6B |
| JHX James Hardie Industries plc | 25.90 | 7.80 | -232% | 53Fair | $15.0B |
| BLDR Builders FirstSource, Inc. | 53.68 | 54.24 | +1% | 68Good | $5.8B |
| EXP Eagle Materials Inc. | 170.58 | 190.85 | +11% | 76Good | $5.2B |
| FBIN Fortune Brands Innovations, Inc. | 39.96 | 30.61 | -31% | 60Fair | $4.8B |
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Start free See the Sunday ScanQuestions about WMS
Is WMS undervalued right now?
Not meaningfully: at 125.19 the stock trades within a few percent of the GLS average fair value of 121.88 (2.7% above fair value, data as of 16 Oct 2026).
What is the Wheel Score of WMS and what does it mean?
WMS scores 72 out of 100 (Good). The Wheel Score blends the margin of safety (25 points), Piotroski health (20), the GLS moat (15), the option premium on offer (20) and trading stability (20) into one number that ranks stocks for the wheel strategy - selling cash-secured puts, then covered calls if assigned. 80 and above is Prime, 65-79 Good, 50-64 Fair, under 50 Weak.
What is the GLS fair value for WMS?
121.88 per share as of 16 Oct 2026 - the simple average of the 9 valuation models (out of nine: DCF, Graham Number, Graham Growth, Lynch, GLS Growth, 10 Cap, Payback Time, DDM and EPV) that produced a positive value. The models run every night on the latest filings; the Quote page lets you switch any of them off and add a margin of safety of your own.
When does Advanced Drainage Systems, Inc. report earnings next?
The next earnings report is due on 5 Nov 2026 (before the open), 20 days from the data date of 16 Oct 2026. The Calendars page lists every upcoming report with its time of day.
Does WMS have listed options, and how liquid are they?
Yes. The nightly snapshot found 254 listed contracts with 3,222 open interest across all expiries and implied volatility of 47% on the near-the-money contracts. The Options scanner lists the cash-secured put and covered call set-ups with premium and annualised yield worked out.