Being the one of the very few domestic pure-play players in the U.S. water heating market, and the successful explorer of the Chinese market, the 145-year-old A.O. Smith (NYSE: AOS) encountered some issues overseas. The dim outlook on sales growth (projected down 7-10%) on China in 2019 reflected a weakened Chinese market and evoked further concern from investors. In this article, I would like to introduce AOS's journey in China, the factors that led to its success, worrisome headwinds, and the reasons why investors should not panic.
1. AOS has a proven track record