Advanced Drainage Systems cuts FY27 revenue outlook and sees lower residential demand

Advanced Drainage Systems reported Q2 net sales of $889.4 million, a 4.6% increase, but diluted EPS fell 11.0% to $1.77. The company lowered its fiscal 2027 revenue guidance to a range of $3.3 billion‑$3.4 billion and trimmed full‑year EBITDA guidance. Management cited softer residential demand, higher interest rates and lower-than‑expected material‑cost inflation, while noting the StormTrap acquisition will close in Q4 2026.

DA Davidson cut its price target for WMS to $180 from $190, reflecting the weaker revenue outlook. The reduced guidance may pressure the stock and affect investors’ valuation assumptions.

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