Zacks Research Has Bearish Forecast for Watsco Q2 Earnings

Key Points

• Zacks Research lowered its Q2 2027 EPS forecast for Watsco to $4.58 from $4.61, while estimating full-year 2027 earnings of $13.26 per share.
• Analysts remain cautious: Watsco has a consensus “Hold” rating and an average price target of $395.50, despite individual targets ranging from $330 to $485.
• Watsco’s latest quarter missed expectations, reporting $4.00 EPS versus the $4.41 consensus and revenue of $2.10 billion versus $2.14 billion; shares recently traded near $325.79, down substantially from their 52-week high of $459.

Watsco, Inc. (NYSE:WSO - Free Report) - Zacks Research cut their Q2 2027 earnings per share estimates for Watsco in a research note issued to investors on Wednesday, September 23rd. Zacks Research analyst Team now anticipates that the construction company will post earnings per share of $4.58 for the quarter, down from their prior forecast of $4.61. The consensus estimate for Watsco's current full-year earnings is $12.21 per share. Zacks Research also issued estimates for Watsco's Q3 2027 earnings at $4.58 EPS, Q4 2027 earnings at $2.16 EPS and FY2027 earnings at $13.26 EPS.

A number of other equities research analysts have also recently commented on WSO. Robert W. Baird set a $400.00 target price on shares of Watsco in a research report on Thursday, July 30th. Stephens reaffirmed an "overweight" rating and issued a $485.00 price target on shares of Watsco in a report on Monday, August 17th. DA Davidson reduced their price target on Watsco from $385.00 to $330.00 and set a "neutral" rating on the stock in a research report on Thursday, July 30th. Weiss Ratings reiterated a "hold (c)" rating on shares of Watsco in a report on Friday, June 26th. Finally, Morgan Stanley raised their price objective on Watsco from $370.00 to $405.00 and gave the stock an "equal weight" rating in a research report on Friday, July 10th. Two analysts have rated the stock with a Buy rating and nine have assigned a Hold rating to the stock. According to MarketBeat, the company currently has a consensus rating of "Hold" and an average target price of $395.50.

Watsco Stock Up 0.1%

Shares of Watsco stock opened at $325.79 on Thursday. The firm's 50 day moving average price is $324.61 and its 200-day moving average price is $369.45. Watsco has a 52-week low of $295.75 and a 52-week high of $459.00. The company has a market cap of $13.44 billion, a P/E ratio of 28.26 and a beta of 1.05.

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

Watsco Dividend Announcement

The business also recently announced a quarterly dividend, which was paid on Friday, July 31st. Investors of record on Thursday, July 16th were paid a $3.30 dividend. The ex-dividend date was Thursday, July 16th. This represents a $13.20 dividend on an annualized basis and a yield of 4.1%. Watsco's dividend payout ratio (DPR) is 114.48%.

Institutional Trading of Watsco

Large investors have recently bought and sold shares of the stock. Assetmark Inc. lifted its holdings in shares of Watsco by 2.7% during the first quarter. Assetmark Inc. now owns 1,115 shares of the construction company's stock valued at $406,000 after purchasing an additional 29 shares during the last quarter. Bessemer Group Inc. increased its stake in Watsco by 10.5% in the 1st quarter. Bessemer Group Inc. now owns 496 shares of the construction company's stock worth $181,000 after purchasing an additional 47 shares in the last quarter. Root Financial Partners LLC increased its stake in Watsco by 15.9% in the 1st quarter. Root Financial Partners LLC now owns 357 shares of the construction company's stock worth $130,000 after purchasing an additional 49 shares in the last quarter. Intrinsic Value Partners LLC raised its holdings in Watsco by 2.9% during the 1st quarter. Intrinsic Value Partners LLC now owns 1,789 shares of the construction company's stock worth $651,000 after buying an additional 50 shares during the period. Finally, World Investment Advisors raised its holdings in Watsco by 8.6% during the 1st quarter. World Investment Advisors now owns 660 shares of the construction company's stock worth $240,000 after buying an additional 52 shares during the period. Hedge funds and other institutional investors own 89.71% of the company's stock.

About Watsco

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.

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