Watsco (NYSE:WSO) Downgraded to Strong Sell Rating by Zacks Research

Key Points

• Zacks Research downgraded Watsco to “strong sell” from “hold” and projected fiscal 2027 earnings of $13.26 per share.
• Analyst opinion remains mixed, with a consensus “Hold” rating and $395.50 price target; targets range from $330 to $485.
• Watsco shares opened at $325.79, near their 50-day average and well below the 200-day average. The company recently missed quarterly estimates, reporting $4.00 EPS versus $4.41 expected and revenue of $2.10 billion versus $2.14 billion forecast.

Watsco (NYSE:WSO - Get Free Report) was downgraded by research analysts at Zacks Research from a "hold" rating to a "strong sell" rating in a research report issued on Tuesday, Zacks reports. Zacks Research also issued estimates for Watsco's Q2 2027 earnings at $4.58 EPS, Q3 2027 earnings at $4.58 EPS, Q4 2027 earnings at $2.16 EPS and FY2027 earnings at $13.26 EPS.

Other analysts also recently issued reports about the company. Stephens reissued an "overweight" rating and set a $485.00 price objective on shares of Watsco in a research report on Monday, August 17th. Weiss Ratings reaffirmed a "hold (c)" rating on shares of Watsco in a research report on Friday, June 26th. Robert W. Baird set a $400.00 target price on shares of Watsco in a research note on Thursday, July 30th. DA Davidson lowered their target price on shares of Watsco from $385.00 to $330.00 and set a "neutral" rating for the company in a research note on Thursday, July 30th. Finally, Morgan Stanley lifted their price target on shares of Watsco from $370.00 to $405.00 and gave the company an "equal weight" rating in a research report on Friday, July 10th. Two equities research analysts have rated the stock with a Buy rating, eight have issued a Hold rating and one has assigned a Sell rating to the company. Based on data from MarketBeat, the company currently has a consensus rating of "Hold" and a consensus price target of $395.50.

Watsco Stock Performance

WSO stock opened at $325.79 on Tuesday. The firm has a market cap of $13.44 billion, a PE ratio of 28.26 and a beta of 1.05. The firm's 50 day moving average price is $324.61 and its 200-day moving average price is $369.45. Watsco has a one year low of $295.75 and a one year high of $459.00.

Watsco (NYSE:WSO - Get Free Report) last posted its earnings results on Wednesday, July 29th. The construction company reported $4.00 earnings per share (EPS) for the quarter, missing the consensus estimate of $4.41 by ($0.41). Watsco had a return on equity of 14.40% and a net margin of 6.53%.The business had revenue of $2.10 billion for the quarter, compared to analyst estimates of $2.14 billion. During the same period last year, the business earned $4.52 EPS. Watsco's revenue was up 2.1% compared to the same quarter last year. Equities research analysts predict that Watsco will post 12.21 EPS for the current fiscal year.

Hedge Funds Weigh In On Watsco

Institutional investors have recently bought and sold shares of the company. Capital International Investors lifted its position in shares of Watsco by 103.1% during the fourth quarter. Capital International Investors now owns 4,642,893 shares of the construction company's stock worth $1,564,423,000 after purchasing an additional 2,356,998 shares in the last quarter. Norges Bank acquired a new position in shares of Watsco in the fourth quarter valued at approximately $110,853,000. Bank of America Corp DE acquired a new position in shares of Watsco in the second quarter valued at approximately $119,291,000. Bank of New York Mellon Corp purchased a new stake in Watsco during the 2nd quarter worth approximately $97,937,000. Finally, Findlay Park Partners LLP acquired a new stake in Watsco during the 2nd quarter worth approximately $78,695,000. 89.71% of the stock is owned by institutional investors and hedge funds.

Watsco Company Profile

Watsco, Inc is a distributor of heating, ventilation, air conditioning and refrigeration (HVAC/R) equipment and related products. The company supplies residential and commercial contractors with air conditioners, furnaces, heat pumps, refrigeration systems, ductwork, thermostats, controls, tools, replacement parts and other installation supplies.

Through its distribution network and digital sales platforms, Watsco serves HVAC/R contractors, dealers and other customers primarily across the United States, as well as in Canada and Puerto Rico.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.