Stock fact sheet · data as of
Advanced Drainage Systems, Inc. (WMS): fair value, margin of safety and Wheel Score
Ticker symbol WMS · Basic Materials · Construction Materials · United States · Growth
Is WMS undervalued?
Advanced Drainage Systems, Inc. (WMS) closed at 144.18 on 5 Nov 2026, 18% above the GLS average fair value of 122.12. Only 3 of the 9 models that produced a number value the shares above the current price. The margin of safety is negative, so the stock fails the "below fair value" Wheel Trade Filter; a premium of this size is common for companies whose growth the models are conservative about.
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.
Ranked against every other company we cover, WMS is clearly faster-growing than it is cheap, so the nightly engine files it under Growth (value score 23, growth score 44, out of 100).
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 | 120.15 | -17% | Present value of the projected free cash flows, discounted at the cost of capital |
| Graham Number | 56.83 | -61% | The most a defensive investor pays for the earnings and book value per share |
| Graham Growth | 267.53 | +86% | Graham's growth formula: EPS × (8.5 + 2 × growth), adjusted for bond yields |
| Lynch | 111.76 | -22% | EPS × the earnings growth rate (PEG of 1), growth capped at 25% |
| GLS Growth | 82.05 | -43% | EPS compounded ten years at the blended growth rate, discounted back at 15% a year |
| 10 Cap | 199.60 | +38% | Owner's earnings (operating cash flow less maintenance capex) capitalised at 10% |
| Payback Time | 184.48 | +28% | Eight years of compounded free cash flow: the price at which the business pays for itself |
| DDM | 11.18 | -92% | Dividend discount model: next year's dividend ÷ (10% − 3% growth); needs a dividend |
| EPV | 65.49 | -55% | Earnings power value: current EPS capitalised at 9% with no growth |
| Zombie (liquidation) | -17.49 | -112% | Current assets less all liabilities, per share: the balance-sheet floor. Not in the average |
| Wall St target | 188.20 | +31% | 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 "Piotroski 6 or more" Wheel Trade Filter. 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 6.2/10 on the GLS Moat - a middle reading; the Moat Score tab on the Quote page's Financials view shows which of the four parts hold it back.
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 5.1%.
The dividend yield is 0.53% 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 | 6.2 / 10 | ROE | 22.1% |
| Debt / equity | 0.93 | ROA | 9.5% |
| Free-cash-flow yield | 5.1% | Payout ratio | 13% |
| Institutions | 10 / 10 | Insiders · Congress | 1 · 5 / 10 |
Wheel Score 37: Weak
With a Wheel Score of 37 Advanced Drainage Systems, Inc. sits in the Weak band. It fails filter 3, below fair value - trades 18% above our fair value; Value (weak) is its weakest part.
Implied volatility is 44% on the near-the-money contracts 20-60 days out - inside the 35-60% sweet spot the Wheel Score rewards most: enough premium to be worth selling, not so much that the risk is unpaid. Chain open interest is thin - 1,663 contracts across every expiry - so fills at a fair price are not guaranteed; a 30-45-day put may not exist at a usable strike.
Volume runs at 1.0M shares a day on a market cap of $10.9B, with a beta of 1.30 - 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 rates that good.
| Filter | Wheel Trade Filter | Result | Detail |
|---|---|---|---|
| 1 | Options that actually trade | Passes | Listed options with 1,000+ contracts of open interest and 100+ traded a day |
| 2 | A real business, not a gamble | Passes | Profitable over the last twelve months - not a speculative stock, fund or note |
| 3 | Below fair value | Fails | trades 18% above our fair value |
| 4 | Financially healthy | Passes | Piotroski F-score 6 or more out of 9 (a company with no score on file passes) |
| 5 | Can repay its debt | Passes | Long-term debt repaid from 3 years of operating cash flow or less (6 for real estate and utilities; banks and insurers are not judged on it) |
| 6 | No serious red flags | Passes | Red Flags score 60 or more out of 100 (earnings, margins, debt, analysts, filings and price checked the same way for every stock) |
| 7 | A premium worth selling | Passes | Implied volatility 25-80% (enough premium, not a lottery ticket) |
| 8 | Big enough | Passes | Market cap $1 billion or more |
| 9 | Not a penny stock | Passes | Share price $5 or more |
| How it ranks | Rating | From | |
|---|---|---|---|
| Value | Weak | 18% above fair value | |
| Premium | Strong | implied volatility 44% | |
| Moat | Good | moat 6.2/10 | |
| Health | Good | Piotroski 6/9 | |
| Red Flags | Good | Red Flags score 85/100 | |
| Option trading | Weak | 403 contracts a day, 1,663 open interest | |
| Stability | Good | beta 1.30, $10.9B company |
The Wheel Score ranks ~7,400 US stocks for selling cash-secured puts and covered calls: a stock must pass all 9 Wheel Trade Filters to score 70, and the score then ranks the ones that pass; the Sunday Scan is the top 10. It is updated nightly and is not a recommendation. How the Wheel Score works · the walkthrough lesson shows how it fits into a trade, start to finish.
Upcoming events
Advanced Drainage Systems, Inc. reports earnings on 5 Nov 2026 (before the open) - inside the 14-day window the Sunday Scan avoids, because a put sold now would carry the report's gap risk.
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 | 127.80 | 178.38 | +28% | 48Weak | $10.1B |
| SSD Simpson Manufacturing Co., Inc. | 205.16 | 121.42 | -69% | 40Weak | $8.4B |
| SPXC SPX Technologies, Inc. | 153.47 | 145.69 | -5% | 34Weak | $7.7B |
| CSL Carlisle Companies Incorporated | 398.82 | 269.63 | -48% | 39Weak | $15.4B |
| BLDR Builders FirstSource, Inc. | 69.50 | 31.29 | -122% | 35Weak | $7.5B |
| CX CEMEX, S.A.B. de C.V. | 10.93 | 34.30 | +68% | 84Good | $15.9B |
| AWI Armstrong World Industries, Inc. | 175.95 | 158.48 | -11% | 29Weak | $7.4B |
| MAS Masco Corporation | 86.82 | 75.31 | -15% | 40Weak | $16.7B |
| JHX James Hardie Industries plc | 29.52 | 7.56 | -290% | 35Weak | $17.1B |
| EXP Eagle Materials Inc. | 198.19 | 189.74 | -4% | 36Weak | $6.1B |
| TREX Trex Company, Inc. | 57.15 | 43.32 | -32% | 40Weak | $5.8B |
| FBIN Fortune Brands Innovations, Inc. | 47.47 | 30.02 | -58% | 35Weak | $5.7B |
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A free GLS Equity account gets you nightly fair value and the Wheel Score on ~7,400 US stocks, a watchlist, the scanner preview and the Sunday Scan - the top 10 stocks that pass all 9 Wheel Trade Filters, emailed every week. Pro adds the full put and call scanners, unlimited watchlists with alerts and the trade journal.
Start free See the Sunday ScanQuestions about WMS
Is WMS undervalued right now?
No: at 144.18 the stock trades 18% above the GLS average fair value of 122.12 (data as of 5 Nov 2026). The margin of safety is negative.
What is the Wheel Score of WMS and what does it mean?
WMS scores 37 out of 100 (Weak) - it fails Wheel Trade Filter 3. The Wheel Score ranks stocks for the wheel strategy - selling cash-secured puts, then covered calls if assigned - in two parts: the 9 pass/fail Wheel Trade Filters (busy options, a real business, below fair value, Piotroski 6 or more, debt it can repay, a Red Flags score of 60 or more, implied volatility of 25-80%, a $1 billion company, $5 a share) and a ranking of how strongly a stock passes on value, premium, moat, health, red flags, option trading and stability. A stock that fails any filter stays under 70; 70-84 is Good, 85 and above is Prime. The Sunday Scan is the top 10 that pass, sorted by Wheel Score.
What is the GLS fair value for WMS?
122.12 per share as of 5 Nov 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), 0 days from the data date of 5 Nov 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 86 listed contracts with 1,663 open interest across all expiries and implied volatility of 44% 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.