Watsco, Inc. (NYSE:WSO) Receives Consensus Rating of "Hold" from Analysts

Key Points

• Watsco has a consensus analyst rating of “Hold”, based on nine research firms, with eight holds and one buy; the average 12-month price target is about $399.83.
• The company recently beat quarterly earnings and revenue expectations, reporting EPS of $1.87 versus $1.73 expected and revenue of $1.53 billion versus $1.49 billion expected, though revenue was only slightly above last year’s level.
• Watsco raised its quarterly dividend to $3.30 from $3.00, making the annualized payout $13.20 and yielding about 3.5%, but its payout ratio is high at over 109%.

Watsco, Inc. (NYSE:WSO - Get Free Report) has been given an average recommendation of "Hold" by the nine research firms that are covering the stock, Marketbeat Ratings reports. Eight analysts have rated the stock with a hold recommendation and one has assigned a buy recommendation to the company. The average twelve-month target price among analysts that have issued ratings on the stock in the last year is $399.8333.

Several analysts have recently weighed in on WSO shares. Zacks Research upgraded Watsco from a "strong sell" rating to a "hold" rating in a report on Wednesday, February 25th. Stephens upped their price objective on Watsco from $475.00 to $485.00 and gave the company an "overweight" rating in a report on Wednesday, April 29th. Wall Street Zen upgraded Watsco from a "sell" rating to a "hold" rating in a report on Saturday, May 2nd. JPMorgan Chase & Co. upped their price objective on Watsco from $370.00 to $400.00 and gave the company a "neutral" rating in a report on Thursday, February 19th. Finally, Mizuho set a $425.00 price objective on Watsco in a report on Wednesday, February 18th.

Watsco Stock Down 1.0%

Shares of WSO stock opened at $374.58 on Friday. Watsco has a fifty-two week low of $323.05 and a fifty-two week high of $494.94. The stock has a market cap of $15.23 billion, a P/E ratio of 31.09 and a beta of 1.12. The business has a fifty day simple moving average of $399.49 and a 200-day simple moving average of $381.10.

Watsco (NYSE:WSO - Get Free Report) last announced its earnings results on Tuesday, April 28th. The construction company reported $1.87 earnings per share for the quarter, beating the consensus estimate of $1.73 by $0.14. Watsco had a net margin of 6.85% and a return on equity of 15.31%. The firm had revenue of $1.53 billion during the quarter, compared to the consensus estimate of $1.49 billion. During the same quarter in the previous year, the company posted $1.93 EPS. The firm's revenue for the quarter was up .1% on a year-over-year basis. On average, sell-side analysts anticipate that Watsco will post 12.73 earnings per share for the current year.

Watsco Increases Dividend

The company also recently announced a quarterly dividend, which was paid on Thursday, April 30th. Shareholders of record on Thursday, April 16th were given a $3.30 dividend. This represents a $13.20 annualized dividend and a yield of 3.5%. The ex-dividend date of this dividend was Thursday, April 16th. This is an increase from Watsco's previous quarterly dividend of $3.00. Watsco's payout ratio is currently 109.54%.

Trending Headlines about Watsco

Here are the key news stories impacting Watsco this week:

• Positive Sentiment: Zacks Research raised Watsco’s FY2026 EPS estimate to $12.56 from $12.38, suggesting slightly better expected full-year profitability. Watsco research report
• Positive Sentiment: The firm also increased its Q3 2026 EPS estimate to $4.29 from $4.22 and Q1 2027 EPS to $1.92 from $1.89, pointing to stronger near-term earnings expectations. Watsco research report
• Positive Sentiment: Zacks slightly lifted its Q2 2027 EPS forecast to $4.75 from $4.74, indicating continued stability in the outlook. Watsco research report
• Neutral Sentiment: Zacks kept a Hold rating on Watsco, which does not signal a major change in its overall view of the stock. Watsco research report
• Negative Sentiment: Longer-term estimates were trimmed, including FY2027 EPS to $13.70 from $13.83, FY2028 EPS to $14.93 from $15.63, and Q4 2027 EPS to $2.34 from $2.42, which may have weighed on sentiment. Watsco research report
• Negative Sentiment: Q2 2026 EPS was also cut slightly to $4.25 from $4.27, reinforcing the view that analysts see some earnings moderation ahead. Watsco research report

Institutional Trading of Watsco

Several hedge funds have recently added to or reduced their stakes in the business. Capital International Investors increased its holdings in Watsco by 103.1% during the 4th quarter. Capital International Investors now owns 4,642,893 shares of the construction company's stock valued at $1,564,423,000 after purchasing an additional 2,356,998 shares in the last quarter. M&T Bank Corp increased its holdings in Watsco by 60,779.4% during the 4th quarter. M&T Bank Corp now owns 599,662 shares of the construction company's stock valued at $202,056,000 after purchasing an additional 598,677 shares in the last quarter. Norges Bank acquired a new stake in Watsco during the 4th quarter valued at $110,853,000. Corient Private Wealth LLC increased its holdings in Watsco by 202.6% during the 4th quarter. Corient Private Wealth LLC now owns 472,182 shares of the construction company's stock valued at $159,102,000 after purchasing an additional 316,129 shares in the last quarter. Finally, Two Sigma Investments LP increased its holdings in Watsco by 12,054.4% during the 3rd quarter. Two Sigma Investments LP now owns 173,078 shares of the construction company's stock valued at $69,975,000 after purchasing an additional 171,654 shares in the last quarter. Institutional investors own 89.71% of the company's stock.

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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