We came across a bullish thesis on Advanced Drainage Systems on Margin of Sanity’s Substack. As of 3ʳᵈ July, Advanced Drainage Systems’s share was trading at $118.80. WMS’s trailing and forward P/E were 20.62 and 16.92 respectively according to Yahoo Finance.
Aerial view of a busy water resource management facility, with a river running through it, dotted with homes.
Advanced Drainage Systems (WMS) operates in a crucial yet often overlooked sector of the economy: water management infrastructure. The company’s products, including giant underground pipes, play a vital role in managing rainwater and wastewater, preventing flooding, and ensuring clean water supply. With the existing infrastructure in the US aging and in need of upgrading, WMS is well-positioned to address this challenge. The company’s solutions are essential for municipalities, developers, and various industries, as they help mitigate the impacts of flooding and droughts, which are becoming more frequent due to climate change.
The importance of WMS’s products becomes apparent when considering the consequences of inadequate water management. Aging concrete pipes are crumbling, and municipalities face significant challenges in maintaining and upgrading their infrastructure. Failure to address these issues can lead to severe consequences, including flooding, droughts, and disruptions to daily life. WMS’s products offer a solution to these problems, and the company’s expertise in providing effective water management systems is likely to be in high demand. With climate change exacerbating weather fluctuations, the need for reliable water management infrastructure is more pressing than ever.
The investment case for WMS is compelling, given the critical nature of its products and the growing need for water management solutions. As the company provides essential infrastructure for municipalities and industries, it is likely to benefit from increased demand and a growing market. With its expertise in providing innovative solutions to address the challenges of aging infrastructure and climate change, WMS is well-positioned for long-term success. The company’s role in ensuring clean water and mitigating the impacts of flooding and droughts makes it an attractive investment opportunity, with a promising outlook for growth and stability.
Previously we covered a bullish thesis on Aris Water Solutions, Inc. (ARIS) by DualEdgeInvest in June 2025, which highlighted the company’s deep industry alignment through ConocoPhillips and Chevron, its expansion into recycling and mineral recovery, and its two-pronged strategy across infrastructure and water treatment technology. Margin of Sanity shares a similar view but emphasizes the broader, municipal-scale opportunity in water management through Advanced Drainage Systems, highlighting its critical role in climate-resilient infrastructure.
