Sumitomo Mitsui Trust Group Inc. Decreases Holdings in Watsco, Inc. $WSO

Key Points

• Sumitomo Mitsui Trust Group Inc. cut its stake in Watsco by 4.6% in Q4, selling 3,227 shares and now owning 66,680 shares valued at about $22.47 million; institutional investors hold roughly 89.71% of the stock.
• Watsco missed Q4 estimates, reporting EPS of $1.68 versus $1.94 expected and revenue of $1.58 billion, a 9.9% decline year‑over‑year.
• The company raised its quarterly dividend to $3.30 (annualized $13.20) for a 3.1% yield

Sumitomo Mitsui Trust Group Inc. decreased its holdings in shares of Watsco, Inc. (NYSE:WSO - Free Report) by 4.6% in the fourth quarter, according to the company in its most recent 13F filing with the Securities and Exchange Commission (SEC). The firm owned 66,680 shares of the construction company's stock after selling 3,227 shares during the period. Sumitomo Mitsui Trust Group Inc. owned about 0.16% of Watsco worth $22,468,000 as of its most recent filing with the Securities and Exchange Commission (SEC).

A number of other hedge funds have also recently modified their holdings of WSO. SJS Investment Consulting Inc. grew its position in shares of Watsco by 2,366.7% during the 3rd 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 period. TruNorth Capital Management LLC bought a new stake in shares of Watsco during the 3rd quarter valued at $37,000. Steigerwald Gordon & Koch Inc. bought a new stake in shares of Watsco during the 3rd quarter valued at $49,000. First Horizon Corp bought a new stake in shares of Watsco during the 3rd quarter valued at $51,000. Finally, Bayforest Capital Ltd bought a new stake in shares of Watsco during the 3rd quarter valued at $57,000. Institutional investors own 89.71% of the company's stock.

Watsco Trading Up 1.3%

Shares of NYSE WSO opened at $421.26 on Friday. The firm's 50-day moving average price is $394.50 and its 200-day moving average price is $374.19. The stock has a market capitalization of $17.10 billion, a price-to-earnings ratio of 34.79 and a beta of 1.06. Watsco, Inc. has a 12-month low of $323.05 and a 12-month high of $513.54.

Watsco (NYSE:WSO - Get Free Report) last announced its earnings results on Tuesday, February 17th. The construction company reported $1.68 earnings per share (EPS) for the quarter, missing the consensus estimate of $1.94 by ($0.26). The business 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 quarterly revenue was down 9.9% compared to the same quarter last year. During the same quarter in the prior year, the company posted $2.37 earnings per share. On average, equities analysts predict that Watsco, Inc. will post 14.62 EPS for the current fiscal year.

Watsco Increases Dividend

The firm also recently announced a quarterly dividend, which will be paid on Thursday, April 30th. Stockholders of record on Thursday, April 16th will be given a dividend of $3.30 per share. The ex-dividend date is Thursday, April 16th. This represents a $13.20 annualized dividend and a dividend yield of 3.1%. This is a positive change from Watsco's previous quarterly dividend of $3.00. Watsco's dividend payout ratio is currently 109.00%.

Analyst Upgrades and Downgrades

WSO has been the subject of a number of recent research reports. UBS Group initiated coverage on shares of Watsco in a research report on Monday, January 5th. They set a "neutral" rating and a $370.00 price objective for the company. JPMorgan Chase & Co. upped their target price on shares of Watsco from $370.00 to $400.00 and gave the stock a "neutral" rating in a report on Thursday, February 19th. Mizuho set a $425.00 target price on shares of Watsco in a report on Wednesday, February 18th. Morgan Stanley dropped their target price on shares of Watsco from $460.00 to $370.00 and set an "equal weight" rating for the company in a report on Wednesday, January 14th. Finally, Zacks Research raised shares of Watsco from a "strong sell" rating to a "hold" rating in a report on Wednesday, February 25th. One analyst has rated the stock with a Buy rating and eight have assigned a Hold rating to the company's stock. According to MarketBeat.com, Watsco presently has an average rating of "Hold" and a consensus target price of $409.00.

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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