Obermeyer Wealth Partners Trims Stake in Watsco, Inc. $WSO

Key Points

• Obermeyer Wealth Partners cut its stake in Watsco by 81.9% in Q4, selling 4,647 shares and retaining 1,024 shares worth $345,000.
• Watsco missed quarterly expectations with EPS of $1.68 versus a $1.94 consensus and revenue down 9.9% year‑over‑year; analysts hold an overall Hold rating with an average price target of $382.80 while the stock trades around $440.78.
• Watsco raised its quarterly dividend to $3.30 ($13.20 annualized, ~3.0% yield), though the payout ratio stands at a high 109%.

Obermeyer Wealth Partners reduced its position in Watsco, Inc. (NYSE:WSO - Free Report) by 81.9% in the 4th quarter, according to its most recent filing with the SEC. The fund owned 1,024 shares of the construction company's stock after selling 4,647 shares during the period. Obermeyer Wealth Partners' holdings in Watsco were worth $345,000 at the end of the most recent quarter.

Other institutional investors and hedge funds have also made changes to their positions in the company. SJS Investment Consulting Inc. lifted its holdings in shares of Watsco by 2,366.7% in the 3rd quarter. SJS Investment Consulting Inc. now owns 74 shares of the construction company's stock valued at $30,000 after purchasing an additional 71 shares during the last quarter. TruNorth Capital Management LLC purchased a new stake in shares of Watsco in the 3rd quarter valued at about $37,000. Steigerwald Gordon & Koch Inc. purchased a new stake in Watsco in the 3rd quarter valued at $49,000. First Horizon Corp purchased a new stake in Watsco in the 3rd quarter valued at $51,000. Finally, Bayforest Capital Ltd purchased a new stake in Watsco in the 3rd quarter valued at $57,000. 89.71% of the stock is owned by hedge funds and other institutional investors.

Wall Street Analyst Weigh In

Several analysts recently commented on the stock. JPMorgan Chase & Co. upped their price target on shares of Watsco from $370.00 to $400.00 and gave the company a "neutral" rating in a research report on Thursday, February 19th. UBS Group assumed coverage on shares of Watsco in a research report on Monday, January 5th. They issued a "neutral" rating and a $370.00 price target for the company. Mizuho set a $425.00 price target on shares of Watsco in a research report on Wednesday, February 18th. Zacks Research upgraded shares of Watsco from a "strong sell" rating to a "hold" rating in a research report on Wednesday, February 25th. Finally, Morgan Stanley reduced their price target on shares of Watsco from $460.00 to $370.00 and set an "equal weight" rating for the company in a research report on Wednesday, January 14th. Eight analysts have rated the stock with a Hold rating, According to data from MarketBeat.com, Watsco presently has an average rating of "Hold" and an average price target of $382.80.

Watsco Stock Up 0.8%

WSO opened at $440.78 on Friday. The business has a 50 day moving average price of $396.42 and a two-hundred day moving average price of $375.24. The company has a market cap of $17.90 billion, a PE ratio of 36.40 and a beta of 1.06. Watsco, Inc. has a 52 week low of $323.05 and a 52 week high of $496.25.

Watsco (NYSE:WSO - Get Free Report) last posted its quarterly earnings data on Tuesday, February 17th. The construction company reported $1.68 EPS for the quarter, missing the consensus estimate of $1.94 by ($0.26). The company had revenue of $1.58 billion for the quarter, compared to analysts' expectations of $1.62 billion. Watsco had a net margin of 6.87% and a return on equity of 15.49%. The firm's revenue was down 9.9% on a year-over-year basis. During the same period in the prior year, the company earned $2.37 earnings per share. As a group, sell-side analysts expect that Watsco, Inc. will post 12.53 EPS for the current fiscal year.

Watsco Increases Dividend

The company also recently disclosed a quarterly dividend, which will be paid on Thursday, April 30th. Shareholders of record on Thursday, April 16th will be given a dividend of $3.30 per share. This represents a $13.20 dividend on an annualized basis and a yield of 3.0%. The ex-dividend date is Thursday, April 16th. This is an increase from Watsco's previous quarterly dividend of $3.00. Watsco's payout ratio is currently 109.00%.

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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