(WSO) Watsco - Ratings and Ratios
Hvac Equipment, Replacement Parts, Installation Supplies
Dividends
| Dividend Yield | 3.36% |
| Yield on Cost 5y | 6.11% |
| Yield CAGR 5y | 11.10% |
| Payout Consistency | 92.7% |
| Payout Ratio | 91.4% |
| Risk via 10d forecast | |
|---|---|
| Volatility | 30.2% |
| Value at Risk 5%th | 49.4% |
| Relative Tail Risk | -0.70% |
| Reward TTM | |
|---|---|
| Sharpe Ratio | -1.24 |
| Alpha | -46.52 |
| CAGR/Max DD | 0.31 |
| Character TTM | |
|---|---|
| Hurst Exponent | 0.442 |
| Beta | 0.766 |
| Beta Downside | 0.631 |
| Drawdowns 3y | |
|---|---|
| Max DD | 41.62% |
| Mean DD | 9.91% |
| Median DD | 6.87% |
Description: WSO Watsco October 30, 2025
Watsco Inc. (NYSE: WSO) is a leading North-American distributor of HVAC-R (heating, ventilation, air-conditioning, and refrigeration) equipment and related parts. The company supplies a broad product portfolio-including residential ducted and ductless air conditioners, gas/electric/oil furnaces, commercial HVAC systems, and ancillary supplies such as thermostats, refrigerants, and plumbing materials-to contractors and dealers serving both replacement and new-construction markets across the United States, Canada, Latin America, and the Caribbean.
Key operational metrics show the firm’s scale and growth trajectory: FY 2024 revenue topped $9.5 billion, with a 12 % year-over-year increase driven largely by strong demand for energy-efficient units and a 6 % rise in average selling price (ASP) reflecting higher-margin, premium-product mix. The HVAC-R sector is highly sensitive to residential construction activity, home-renovation spending, and macro-economic factors such as interest-rate cycles and seasonal temperature extremes, which together shape dealer inventory cycles and Watsco’s inventory turnover rates.
For analysts looking to deepen their valuation framework, a quick review of Watsco’s free cash flow conversion trends and its exposure to emerging refrigerant regulations (e.g., the phase-down of HFCs) on ValueRay can provide a more nuanced view of upside potential.
Piotroski VR‑10 (Strict, 0-10) 4.5
| Net Income (549.7m TTM) > 0 and > 6% of Revenue (6% = 444.9m TTM) |
| FCFTA 0.11 (>2.0%) and ΔFCFTA -3.26pp (YES ≥ +1.0pp, WARN ≥ +0.5pp) |
| NWC/Revenue 31.07% (prev 29.46%; Δ 1.61pp) (YES ≤20% & Δ≤-1pp; WARN ≤25% & Δ≤0 oder ≤40% & Δ≤-3pp) |
| CFO/TA 0.12 (>3.0%) and CFO 548.7m <= Net Income 549.7m (YES >=105%, WARN >=100%) |
| Net Debt (133.2m) to EBITDA (790.2m) ratio: 0.17 <= 3.0 (WARN <= 3.5) |
| Current Ratio 3.84 (target 1.5–3.0; WARN 1.2–<1.5 or >3.0–5.0; CFO/TA gate active) |
| Outstanding Shares last Quarter (37.9m) change vs 12m ago 0.65% (target <= -2.0% for YES) |
| Gross Margin 28.27% (prev 26.66%; Δ 1.61pp) >=18% & Δ>=+0.5pp (WARN >=15% & Δ>=0) |
| Asset Turnover 163.5% (prev 165.3%; Δ -1.85pp) >=50% & Δ>=+2pp (WARN >=35% & Δ>=0) |
| Interest Coverage Ratio 128.5 (EBITDA TTM 790.2m / Interest Expense TTM 5.82m) >= 6 (WARN >= 3) |
Altman Z'' 6.53
| (A) 0.51 = (Total Current Assets 3.12b - Total Current Liabilities 812.1m) / Total Assets 4.55b |
| (B) 0.30 = Retained Earnings (Balance) 1.37b / Total Assets 4.55b |
| (C) 0.16 = EBIT TTM 747.0m / Avg Total Assets 4.54b |
| (D) 1.07 = Book Value of Equity 1.34b / Total Liabilities 1.25b |
| Total Rating: 6.53 = (6.56 * A) + (3.26 * B) + (6.72 * C) + (1.05 * D) |
ValueRay F-Score (Strict, 0-100) 74.58
| 1. Piotroski 4.50pt |
| 2. FCF Yield 3.74% |
| 3. FCF Margin 6.98% |
| 4. Debt/Equity 0.16 |
| 5. Debt/Ebitda 0.17 |
| 6. ROIC - WACC (= 16.33)% |
| 7. RoE 20.18% |
| 8. Rev. Trend 29.89% |
| 9. EPS Trend 1.45% |
What is the price of WSO shares?
Over the past week, the price has changed by +0.46%, over one month by -2.89%, over three months by -13.01% and over the past year by -33.55%.
Is WSO a buy, sell or hold?
- Strong Buy: 3
- Buy: 0
- Hold: 10
- Sell: 1
- Strong Sell: 1
What are the forecasts/targets for the WSO price?
| Issuer | Target | Up/Down from current |
|---|---|---|
| Wallstreet Target Price | 408.9 | 17.5% |
| Analysts Target Price | 408.9 | 17.5% |
| ValueRay Target Price | 345.7 | -0.6% |
WSO Fundamental Data Overview November 27, 2025
P/E Trailing = 25.7756
P/E Forward = 22.3714
P/S = 1.8776
P/B = 4.7697
P/EG = 1.9853
Beta = 1.002
Revenue TTM = 7.41b USD
EBIT TTM = 747.0m USD
EBITDA TTM = 790.2m USD
Long Term Debt = 15.5m USD (from longTermDebtTotal, last fiscal year)
Short Term Debt = 116.7m USD (from shortTermDebt, last quarter)
Debt = 457.5m USD (from shortLongTermDebtTotal, last quarter)
Net Debt = 133.2m USD (from netDebt column, last quarter)
Enterprise Value = 13.85b USD (13.92b + Debt 457.5m - CCE 524.3m)
Interest Coverage Ratio = 128.5 (Ebit TTM 747.0m / Interest Expense TTM 5.82m)
FCF Yield = 3.74% (FCF TTM 517.8m / Enterprise Value 13.85b)
FCF Margin = 6.98% (FCF TTM 517.8m / Revenue TTM 7.41b)
Net Margin = 7.41% (Net Income TTM 549.7m / Revenue TTM 7.41b)
Gross Margin = 28.27% ((Revenue TTM 7.41b - Cost of Revenue TTM 5.32b) / Revenue TTM)
Gross Margin QoQ = 28.78% (prev 29.26%)
Tobins Q-Ratio = 3.04 (Enterprise Value 13.85b / Total Assets 4.55b)
Interest Expense / Debt = 1.61% (Interest Expense 7.38m / Debt 457.5m)
Taxrate = 9.06% (21.6m / 238.5m)
NOPAT = 679.3m (EBIT 747.0m * (1 - 9.06%))
Current Ratio = 3.84 (Total Current Assets 3.12b / Total Current Liabilities 812.1m)
Debt / Equity = 0.16 (Debt 457.5m / totalStockholderEquity, last quarter 2.81b)
Debt / EBITDA = 0.17 (Net Debt 133.2m / EBITDA 790.2m)
Debt / FCF = 0.26 (Net Debt 133.2m / FCF TTM 517.8m)
Total Stockholder Equity = 2.72b (last 4 quarters mean from totalStockholderEquity)
RoA = 12.07% (Net Income 549.7m / Total Assets 4.55b)
RoE = 20.18% (Net Income TTM 549.7m / Total Stockholder Equity 2.72b)
RoCE = 27.26% (EBIT 747.0m / Capital Employed (Equity 2.72b + L.T.Debt 15.5m))
RoIC = 24.94% (NOPAT 679.3m / Invested Capital 2.72b)
WACC = 8.61% (E(13.92b)/V(14.38b) * Re(8.84%) + D(457.5m)/V(14.38b) * Rd(1.61%) * (1-Tc(0.09)))
Discount Rate = 8.84% (= CAPM, Blume Beta Adj.)
Shares Correlation 3-Years: -33.33 | Cagr: -1.95%
[DCF Debug] Terminal Value 78.89% ; FCFE base≈575.0m ; Y1≈709.0m ; Y5≈1.21b
Fair Price DCF = 506.4 (DCF Value 17.68b / Shares Outstanding 34.9m; 5y FCF grow 24.93% → 3.0% )
EPS Correlation: 1.45 | EPS CAGR: 19.82% | SUE: -3.68 | # QB: 0
Revenue Correlation: 29.89 | Revenue CAGR: 8.70% | SUE: -0.78 | # QB: 0
EPS next Quarter (2026-03-31): EPS=1.93 | Chg30d=-0.143 | Revisions Net=-3 | Analysts=6
EPS next Year (2026-12-31): EPS=13.46 | Chg30d=-0.782 | Revisions Net=-10 | Growth EPS=+8.3% | Growth Revenue=+4.2%
Additional Sources for WSO Stock
Tweets: X | Stocktwits
Fund Manager Positions: Dataroma | Stockcircle