The Short Answer
Watts Water Technologies (WTS) is qualitatively HALAL, but its current quantitative result is incomplete. The March 29, 2026 filing-based ratios pass the known asset screens; the prohibited-activity numerator is not disclosed, so this is not a complete quantitative certification.
Water-flow-control, plumbing-and-drainage, and water-quality manufacturing is generally permissible at the activity level. The current screen shows debt/assets of 6.73%, liquidity/assets of 12.75%, receivables-plus-cash/assets of 25.48%, and disclosed interest income of 0.25% of quarterly revenue; end-use and prohibited-revenue classification remain qualitative.
Current quantitative Sharia screen
Based on 10-Q figures for the period ended 2026-03-29; calculated 2026-07-15.
197.8 / 2,939.8
374.7 / 2,939.8
749.1 / 2,939.8
1.7 / 677.3
- Financial
- Pass
- Overall
- Incomplete
Debt/assets is 6.73%, liquidity/assets is 12.75%, receivables-plus-cash/assets is 25.48% and disclosed interest income is 0.25%; the activity numerator remains incomplete.
- Financial
- Pass
- Overall
- Incomplete
The known asset-based ratios are below the examined limits; no universal prohibited-revenue numerator is disclosed.
- Financial
- Pass
- Overall
- Incomplete
The known financial ratios pass the examined limits. This is not an official classification and the activity numerator remains qualitative.
- Financial
- Not calculated
- Overall
- Incomplete
A licensed historical market-cap series is not stored; the total-assets ratios are shown separately.
Business-activity disclosure
Watts manufactures water-flow-control, plumbing, drainage, HVAC and water-quality products. The core industrial activity is generally permissible, while downstream end-use allocation remains qualitative.
Limitation: The filing does not provide a universal prohibited-revenue numerator across customer and end-use categories.
Purification
The filing discloses $1.7 million of interest income, but no scholar-specific purification instruction or universal prohibited-revenue numerator is provided.
Inputs, assumptions and primary sources
- Amounts are USD millions from Watts Water Technologies' March 29, 2026 Form 10-Q.
- The filing reports $197.8 million of long-term debt and $2,939.8 million of total assets.
- Cash is $374.7 million and trade accounts receivable is $374.4 million.
- Quarterly revenue is $677.3 million and disclosed interest income is $1.7 million, approximately 0.25% of revenue.
- Water, plumbing, HVAC and flow-control products are generally permissible, but no universal prohibited-revenue numerator is asserted.
This is a reproducible financial screen, not a fatwa. A failed total-assets screen can coexist with a pass under a market-cap methodology. ZakatInvest keeps the qualitative assessment separate so numerical thresholds do not erase material context.
Sharia Screening Methodology
Islamic scholars use several criteria to screen stocks:
- Business activity screen: Is the company's primary business halal?
- Debt ratio: Total debt / market cap must be under 33%
- Interest income: Interest income / total revenue must be under 5%
- Haram revenue: Revenue from haram sources must be under 5%
- Receivables ratio: Total receivables / total assets must be under 49–70% (varies by board)
Watts Water's Business Activity
Watts Water operates through geographic segments (Americas, Europe, and APMEA), with product families including:
- Flow-control products: Backflow preventers, water-pressure-regulators, and relief valves
- HVAC and gas products: Boiler-and-hydronic controls and thermostatic mixing valves
- Drainage and water-quality: Drainage-and-water-reuse and filtration products under brands like Watts, Bradley, AERCO, FEBCO, and PVI
These are general-purpose industrial-and-building-products businesses — the company manufactures and sells physical products and earns product-and-service revenue. This is permissible at the activity level.
Concerns to Be Aware Of
1. Leverage Profile
Watts reports $197.8 million of debt and leases against $2,939.8 million of assets (6.73%). That known asset-based ratio passes the examined limits, but a licensed market-cap denominator is not stored and acquisition activity can change the result.
2. Minor Interest Income
The filing discloses $1.7 million of interest income, or about 0.25% of quarterly revenue. It is a screen input, not a scholar-specific purification instruction.
3. End-Market Classification
Water-control-and-plumbing products are sold into mixed-Sharia-profile end-markets (commercial, residential, and industrial construction) via distribution. Under standard methodology, the relevant classification is general-purpose building-products manufacturing rather than the look-through end-customer mix.
Filing-Based Ratios (March 29, 2026)
Based on Watts Water's latest Form 10-Q:
- Debt / assets: 6.73%, below the examined 33.333% limit.
- Cash + interest-bearing securities / assets: 12.75%, below the examined limit.
- Receivables + cash / assets: 25.48%, below the examined limit.
- Interest income / revenue: 0.25%, below the examined 5% benchmark.
- Prohibited-activity revenue: Not disclosed; activity result is incomplete.
Methodology Interpretation
The known financial ratios pass the examined FTSE Yasaar, MSCI total-assets and Malaysia-style limits. Because the filing does not disclose a universal prohibited-revenue numerator and the market-cap denominator is not calculated here, the overall result remains incomplete rather than a universal fatwa.
Bottom Line
Watts Water Technologies (WTS) has a generally permissible core business and passes the known current asset-based financial ratios, but the overall screen is incomplete because prohibited-activity revenue and market-cap inputs are not fully disclosed.
For Muslim investors seeking building-products exposure, WTS sits alongside other halal-screened names like A. O. Smith (AOS) and Nordson (NDSN).
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