What Watts Water Technologies, Inc. told the SEC could break it.

Watts' products are made primarily from bronze, brass, cast iron, stainless steel, steel and plastic — substantially all externally sourced; copper and stainless steel markets have been highly volatile and inflationary.

“Our products are made using various purchased components and raw materials, including primarily bronze, brass, cast iron, stainless steel, steel, and plastic. Substantially all these materials are sourced from external suppliers. The commodity markets have experienced tremendous volatility over the past several years, particularly with respect to copper and stainless steel, and we have experienced high inflationary pressures in these markets.”

2025 U.S. tariffs on imports from Canada, China and Mexico raised Watts' product costs and pressured gross margin; the Feb 20, 2026 Supreme Court decision invalidating IEEPA tariffs adds further uncertainty for an internationally sourced supply chain.

“The tariffs imposed in 2025 on foreign imports to the United States, particularly from Canada, China and Mexico, have increased the costs of our products and could adversely impact the gross margin we earn on our products.”