Watsco, Inc. Website

Watsco, Inc.

NYSE-WSO

Company Overview

Watsco, Inc., together with its subsidiaries, distributes air conditioning, heating, refrigeration equipment, and related parts and supplies. The company distributes equipment comprising residential ducted and ductless air conditioners, such as gas, electric, and oil furnaces; commercial air conditioning and heating equipment systems; and other specialized equipment. It also offers parts, including replacement compressors, evaporator coils, motors, and other component parts; and supplies, such as thermostats, insulation materials, refrigerants, ductworks, grills, registers, sheet metals, tools, copper tubing, concrete pads, tapes, adhesives, and other ancillary supplies, as well as plumbing and bathroom remodeling supplies. The company serves contractors and dealers that service the replacement and new construction markets for residential and light commercial central air conditioning, heating, and refrigeration systems. As of December 31, 2021, it operated from 671 locations in the United States, Canada, Mexico, and Puerto Rico, as well as exports its products to Latin America and the Caribbean Basin. Watsco, Inc. was founded in 1945 and is headquartered in Miami, Florida.

  • Name

    Watsco, Inc.

  • CEO

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  • Website

    www.watsco.com

  • Sector

    Trading Companies and Distributors

  • Year Founded

    1956

Company Statistics

Profile

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Financial Health

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Growth (CAGR)

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Dividends

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Bulls Say

  • Watsco will continue to effectively employ its buy and build strategy to consolidate the HVAC distribution market and compound cash flow.

  • Watsco serves end markets with attractive long-term growth prospects driven by an undersupplied US housing stock, structurally higher repair and remodel spending, and favorable regulatory changes (that is, energy efficiency and refrigerant standards).

  • Watsco's investments in digital technology have differentiated the firm from its competition and could support stronger customer retention rates and more robust profit margins.

Bears Say

  • Watsco's pricing power could normalize as HVAC demand moderates and inflation eases, ushering in lower profit margins compared with the record profitability it achieved in fiscal 2021 and 2022.

  • Watsco's revenue growth could slow amid a maturing residential HVAC replacement cycle and greater economic uncertainty.

  • Watsco has significant supplier concentration risk, with Carrier and Rheem accounting for approximately 60% and 10% of the firm's purchases, respectively.

Source: Morningstar Analysis - Oct 17, 2025

What's happening

Nov 15, 2025 - Dec 17, 2025

Watsco Inc. Faces Mixed Signals Amid Analyst Concerns and Event-Driven Optimism

  • Watsco Inc. experienced a modest overall movement of 0.5% over the past month, underperforming against the S&P 500's return of 1.3%.
  • Positive investor sentiment was observed on December 11, driven by key corporate events and industry conferences that boosted interest in the stock.
  • Despite short-term gains, analysts have expressed concerns about Watsco’s future earnings potential, leading to downward revisions in earnings estimates.

Over the past month, Watsco Inc. (WSO) recorded a slight increase of 0.5%, which is notably lower than the S&P 500's gain of 1.3%. This performance indicates that WSO has struggled to keep pace with broader market trends during this period, reflecting possible challenges related to investor sentiment or specific company issues.

On December 11, shares rose by 2.1%, largely due to positive sentiments surrounding significant events such as Investor Days for both Watsco and Weyerhaeuser and major industry conferences like the Nuclear Energy Forum and Barclays Technology Conference. The anticipation surrounding these gatherings likely spurred increased investor interest on that day.

However, earlier in November raised concerns regarding future profitability when Zacks Research downgraded FY2025 earnings estimates from $13.60 to $12.37 per share while assigning a "Strong Sell" rating for the stock at that time. Other firms including UBS and JPMorgan also lowered their price targets while maintaining neutral ratings amid cautious outlooks from various analysts who collectively assigned an average "Hold" rating for WSO.

The contrasting signals from analyst ratings highlighted ongoing volatility within investor perceptions about WSO's performance trajectory despite recent bullish movements tied to corporate events in early December; this juxtaposition underscores underlying worries regarding long-term growth potential for the company.

Overall, while there were moments of positivity linked to specific events in December, persistent concerns about future profitability weighed heavily on longer-term expectations for Watsco Inc., resulting in its underperformance relative not only to the S&P 500 index but also lagging behind its sector peers within Industrials (XLI), where it underperformed by -2.1%.

NYSE:WSO