Baillie Gifford & Co. Sells 26,594 Shares of Watsco, Inc. $WSO

Key Points

• Baillie Gifford reduced its stake in Watsco by 2.8%, selling 26,594 shares and now holds 917,492 shares (2.26%) valued at about $309.15 million; institutional investors own roughly 89.71% of the stock.
• Watsco missed quarterly estimates (EPS $1.68 vs. $1.94 consensus) as revenue fell 9.9% year‑over‑year to $1.58 billion, and the company raised its quarterly dividend to $3.30 (annualized $13.20, yield ~3.2%, payout ratio ~99.1%).
• Analysts are largely cautious with a consensus "Hold" rating and an average price target of $409, following mixed guidance from firms including Morgan Stanley, UBS, Mizuho and JPMorgan.

Baillie Gifford & Co. cut its stake in Watsco, Inc. (NYSE:WSO - Free Report) by 2.8% during the 4th quarter, according to its most recent Form 13F filing with the Securities and Exchange Commission (SEC). The fund owned 917,492 shares of the construction company's stock after selling 26,594 shares during the period. Baillie Gifford & Co. owned 2.26% of Watsco worth $309,149,000 at the end of the most recent quarter.

Other institutional investors have also added to or reduced their stakes in the company. SJS Investment Consulting Inc. boosted its holdings in Watsco by 2,366.7% in the third quarter. SJS Investment Consulting Inc. now owns 74 shares of the construction company's stock valued at $30,000 after acquiring an additional 71 shares during the last quarter. TruNorth Capital Management LLC acquired a new position in Watsco in the third quarter valued at approximately $37,000. Capital A Wealth Management LLC lifted its stake in Watsco by 4,700.0% in the second quarter. Capital A Wealth Management LLC now owns 96 shares of the construction company's stock valued at $41,000 after buying an additional 94 shares during the period. Steigerwald Gordon & Koch Inc. acquired a new position in Watsco in the third quarter valued at approximately $49,000. Finally, First Horizon Corp acquired a new position in Watsco in the third quarter valued at approximately $51,000. 89.71% of the stock is currently owned by institutional investors.

Analyst Ratings Changes

Several equities analysts have issued reports on WSO shares. UBS Group started coverage on Watsco in a research note on Monday, January 5th. They issued a "neutral" rating and a $370.00 price target on the stock. Mizuho set a $425.00 price target on Watsco in a research note on Wednesday, February 18th. Morgan Stanley dropped their price target on Watsco from $460.00 to $370.00 and set an "equal weight" rating on the stock in a research note on Wednesday, January 14th. Zacks Research raised Watsco from a "strong sell" rating to a "hold" rating in a research note on Wednesday, February 25th. Finally, JPMorgan Chase & Co. boosted their price target on Watsco from $370.00 to $400.00 and gave the company a "neutral" rating in a research note on Thursday, February 19th. One equities research analyst has rated the stock with a Buy rating and eight have issued a Hold rating to the company. Based on data from MarketBeat.com, Watsco currently has a consensus rating of "Hold" and an average price target of $409.00.

Watsco Stock Down 0.1%

Shares of WSO opened at $408.86 on Monday. Watsco, Inc. has a 12-month low of $323.05 and a 12-month high of $518.00. The business's fifty day moving average is $393.13 and its 200 day moving average is $373.32. The stock has a market cap of $16.60 billion, a P/E ratio of 33.76 and a beta of 1.06.

Watsco (NYSE:WSO - Get Free Report) last issued its earnings results on Tuesday, February 17th. The construction company reported $1.68 earnings per share (EPS) for the quarter, missing analysts' consensus estimates of $1.94 by ($0.26). The firm had revenue of $1.58 billion during the quarter, compared to the consensus estimate of $1.62 billion. Watsco had a return on equity of 15.49% and a net margin of 6.87%.Watsco's revenue for the quarter was down 9.9% on a year-over-year basis. During the same quarter in the prior year, the business earned $2.37 earnings per share. On average, analysts expect that Watsco, Inc. will post 14.62 EPS for the current year.

Watsco Increases Dividend

The business also recently declared a quarterly dividend, which will be paid on Thursday, April 30th. Investors of record on Thursday, April 16th will be given a $3.30 dividend. This represents a $13.20 dividend on an annualized basis and a yield of 3.2%. The ex-dividend date of this dividend is Thursday, April 16th. This is an increase from Watsco's previous quarterly dividend of $3.00. Watsco's payout ratio is currently 99.09%.

About Watsco

Watsco, Inc is the largest distributor of heating, ventilation, air conditioning and refrigeration (HVAC/R) equipment, parts and supplies in the United States. Headquartered in Miami, Florida, the company operates a network of more than 600 branches across the continental U.S., Canada and Puerto Rico. Watsco serves residential and commercial contractors by providing essential components for climate control systems, including air conditioners, furnaces, heat pumps, coils, refrigerants, controls and electrical and piping supplies.

Founded in 1947, Watsco has grown from a single regional distributor into an industry leader through a combination of organic expansion, acquisitions and strategic partnerships with original equipment manufacturers such as Carrier, Trane, Goodman and Lennox.

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