Advanced Drainage Systems, Inc. (WMS) Stock — Forensic Analysis, Red Flags & Rating | Stockonomy · Stockonomy
Forensic Analysis · Durable Goods, Textiles & Apparel · as of Sep 15, 2026
Advanced Drainage Systems, Inc. (WMS)
A forensic read on Advanced Drainage Systems, Inc. built from its complete SEC filings — financial-health screens, earnings quality, red flags and a price-aware rating. Reproducible math, not opinion.
C · Mixed — selective
Forensic grade
Safe
Financial health
7.2
Distress distance
Clean
Earnings quality
3
Forensic signals
21.1
P / E (ttm)
22.9%
ROE
$9.8B
Market cap
0.51%
Dividend yield
5.0%
Revenue growth
This free snapshot doesn't read filing or proxy text, so the auditor-quality and governance checks that can lower a grade were not evaluated (red flags, auditor quality, say on pay, board independence, going concern, valuation). Those checks only ever lower a grade, so the full analysis can land below the grade above but never above it — treat it as the most favourable reading, not the settled one.
Advanced Drainage Systems, Inc. earns a C (Mixed — selective) forensic quality grade, and its balance-sheet distress test reads 7.2, placing it in the Safe zone. 3 forensic signals were flagged in its latest SEC filings, led by accruals ratio (% of noa).
What the filings flag
+31.5%
FY2025→FY2026
Accruals ratio (% of NOA).Net operating assets grew +31.5% relative to their own average in FY2026 — scaled by NOA itself, not by total assets, which is what the Forensic Screens card's own accrual row divides by. Accruals are building sharply — a large slice of profit sits in operating assets, not cash. An accrual is a claim that still has to be collected or written down, so the gap resolves in a later period whichever way it goes. The build is led by receivables up +17% against revenue +5% and inventory up +11% against +4% in cost of sales. A cash-flow measure on the same base disagrees: reported earnings ran behind operating cash by 14% of net operating assets, against an accruals ratio of 31.5%. The two are computed differently: the accruals ratio is the change in net operating assets over average net operating assets, while the cash-flow figure is net income less operating cash flow over that same average. Read them as two results, not one.
12.4%
FY2026
Return on invested capital.Return on invested capital is 12.4% in the latest fiscal year, against 13% in FY2022, having run between 12.4% and 23.9% across FY2022–FY2026 with no direction held — a modest positive spread over the ~9% cost of capital we hold this sector to — the capital already deployed adds value, though not dramatically. The capital base behind it grew +67% across FY2022–FY2026, from $2.3B to $3.8B, while the return fell 0.6 points, so the dollars added over that window earned less than the 13% the older base was already earning.
-70%
FY2020→FY2021
Dividend — cut.The payout was CUT ~70% in FY2021 (from FY2020) and hasn't been restored since. It still returns some cash, but it is NOT the dependable, rising dividend an unbroken streak implies.
Key fundamentals
Net Margin14.0%
Debt / Equity0.87x
Free Cash Flow$569.3M
Latest Revenue$3.05B
Return on Equity22.9%
Revenue CAGR (3yr)-0.2%
Revenue Growth YoY+5.0%
The forensic grade and screens above are free — no account needed. Want the AI investment read on top — the 0–100 rating, thesis, bull-vs-bear, red flags and the 12-month scenario, written from Advanced Drainage Systems, Inc.'s actual 10-K/10-Q/8-K filings?