William Blair Has Bullish Outlook for Watsco FY2025 Earnings

Key Points

• William Blair raised its FY2025 earnings per share estimate for Watsco to $13.50, up from a previous estimate of $13.35, indicating a bullish outlook for the company's earnings.
• Watsco reported a Q2 earnings miss with $4.52 EPS, falling short of analysts' expectations of $4.84 EPS, and experienced a 3.6% decline in quarterly revenue year-over-year.
• The company recently announced a quarterly dividend of $3.00 per share, reflecting a 3.0% yield and a dividend payout ratio of 92.02%.

Watsco, Inc. (NYSE:WSO - Free Report) - Equities research analysts at William Blair upped their FY2025 earnings per share (EPS) estimates for shares of Watsco in a report issued on Tuesday, September 2nd. William Blair analyst R. Merkel now forecasts that the construction company will earn $13.50 per share for the year, up from their prior forecast of $13.35. The consensus estimate for Watsco's current full-year earnings is $14.62 per share. William Blair also issued estimates for Watsco's Q4 2025 earnings at $2.51 EPS, Q2 2026 earnings at $4.59 EPS, Q3 2026 earnings at $4.85 EPS, Q4 2026 earnings at $2.78 EPS, FY2026 earnings at $14.60 EPS and FY2027 earnings at $16.53 EPS.

Watsco (NYSE:WSO - Get Free Report) last announced its earnings results on Wednesday, July 30th. The construction company reported $4.52 earnings per share (EPS) for the quarter, missing analysts' consensus estimates of $4.84 by ($0.32). Watsco had a net margin of 7.08% and a return on equity of 16.96%. The business had revenue of $2.06 billion during the quarter, compared to analyst estimates of $2.24 billion. During the same period in the previous year, the company earned $4.49 earnings per share. The business's revenue for the quarter was down 3.6% on a year-over-year basis.

Several other equities research analysts have also issued reports on the company. JPMorgan Chase & Co. upped their price target on Watsco from $445.00 to $460.00 and gave the company a "neutral" rating in a research report on Tuesday, May 27th. UBS Group lowered their price target on Watsco from $455.00 to $450.00 and set a "neutral" rating on the stock in a report on Wednesday, June 25th. Finally, Morgan Stanley set a $505.00 target price on Watsco in a report on Wednesday, July 2nd. One analyst has rated the stock with a Buy rating and six have given a Hold rating to the company. According to MarketBeat, Watsco currently has a consensus rating of "Hold" and an average price target of $484.17.

Watsco Stock Up 1.2%

Shares of WSO traded up $5.02 during trading on Friday, reaching $408.41. The company's stock had a trading volume of 241,987 shares, compared to its average volume of 280,110. The company has a fifty day moving average of $439.49 and a two-hundred day moving average of $463.34. Watsco has a twelve month low of $390.36 and a twelve month high of $571.41. The company has a market cap of $16.56 billion, a price-to-earnings ratio of 31.32 and a beta of 0.96.

Hedge Funds Weigh In On Watsco

A number of hedge funds and other institutional investors have recently modified their holdings of the stock. Kayne Anderson Rudnick Investment Management LLC boosted its position in shares of Watsco by 0.5% in the 1st quarter. Kayne Anderson Rudnick Investment Management LLC now owns 1,557,610 shares of the construction company's stock valued at $791,734,000 after purchasing an additional 7,760 shares during the period. Charles Schwab Investment Management Inc. boosted its position in Watsco by 2.2% during the 2nd quarter. Charles Schwab Investment Management Inc. now owns 1,485,996 shares of the construction company's stock worth $656,036,000 after acquiring an additional 31,484 shares during the period. Blair William & Co. IL boosted its position in Watsco by 5.7% during the 1st quarter. Blair William & Co. IL now owns 814,712 shares of the construction company's stock worth $414,118,000 after acquiring an additional 43,776 shares during the period. JPMorgan Chase & Co. boosted its position in Watsco by 4.0% during the 1st quarter. JPMorgan Chase & Co. now owns 496,428 shares of the construction company's stock worth $252,335,000 after acquiring an additional 18,958 shares during the period. Finally, GAMMA Investing LLC boosted its position in Watsco by 89,376.0% during the 1st quarter. GAMMA Investing LLC now owns 477,802 shares of the construction company's stock worth $242,867,000 after acquiring an additional 477,268 shares during the period. Institutional investors and hedge funds own 89.71% of the company's stock.

Watsco Dividend Announcement

The business also recently declared a quarterly dividend, which was paid on Thursday, July 31st. Investors of record on Wednesday, July 16th were given a $3.00 dividend. The ex-dividend date was Wednesday, July 16th. This represents a $12.00 dividend on an annualized basis and a dividend yield of 2.9%. Watsco's dividend payout ratio (DPR) is 92.02%.

Watsco Company Profile

Watsco, Inc, together with its subsidiaries, engages in the distribution of air conditioning, heating, refrigeration equipment, and related parts and supplies in the United States and internationally. The company distributes equipment, including residential ducted and ductless air conditioners, such as gas, electric, and oil furnaces; commercial air conditioning and heating equipment systems; and other specialized equipment.