WATSCO INC -CL B (WSO.B) Stock Fundamental Analysis
NYSE:WSO.B - US9426221019 - Common Stock
434.825 USD
-2.66 (-0.61%)
Taking everything into account, WSO.B scores 5 out of 10 in our fundamental rating. WSO.B was compared to 50 industry peers in the Trading Companies & Distributors industry. WSO.B has an excellent profitability rating, but there are some minor concerns on its financial health. WSO.B is quite expensive at the moment. It does show a decent growth rate.
1. Profitability
1.1 Basic Checks
WSO.B had positive earnings in the past year.
WSO.B had a positive operating cash flow in the past year.
WSO.B had positive earnings in each of the past 5 years.
Each year in the past 5 years WSO.B had a positive operating cash flow.
1.2 Ratios
WSO.B has a Return On Assets of 10.44%. This is amongst the best in the industry. WSO.B outperforms 85.71% of its industry peers.
The Return On Equity of WSO.B (17.88%) is better than 69.39% of its industry peers.
Looking at the Return On Invested Capital, with a value of 16.15%, WSO.B belongs to the top of the industry, outperforming 87.76% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for WSO.B is significantly above the industry average of 9.98%.
The 3 year average ROIC (20.81%) for WSO.B is well above the current ROIC(16.15%). The reason for the recent decline needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.44% | ||
| ROE | 17.88% | ||
| ROIC | 16.15% |
ROA(3y)13.43%
ROA(5y)12.52%
ROE(3y)23.42%
ROE(5y)21.95%
ROIC(3y)20.81%
ROIC(5y)19.72%
1.3 Margins
The Profit Margin of WSO.B (6.58%) is better than 67.35% of its industry peers.
WSO.B's Profit Margin has improved in the last couple of years.
The Operating Margin of WSO.B (9.87%) is better than 69.39% of its industry peers.
In the last couple of years the Operating Margin of WSO.B has grown nicely.
WSO.B has a Gross Margin (27.54%) which is comparable to the rest of the industry.
In the last couple of years the Gross Margin of WSO.B has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 9.87% | ||
| PM (TTM) | 6.58% | ||
| GM | 27.54% |
OM growth 3Y0.55%
OM growth 5Y5.7%
PM growth 3Y2.52%
PM growth 5Y6.74%
GM growth 3Y0.36%
GM growth 5Y2.05%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so WSO.B is creating value.
WSO.B has more shares outstanding than it did 1 year ago.
WSO.B has more shares outstanding than it did 5 years ago.
Compared to 1 year ago, WSO.B has an improved debt to assets ratio.
2.2 Solvency
WSO.B has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0.29 | ||
| Altman-Z | N/A |
ROIC/WACC1.59
WACC10.15%
2.3 Liquidity
WSO.B has a Current Ratio of 3.08. This indicates that WSO.B is financially healthy and has no problem in meeting its short term obligations.
WSO.B has a better Current ratio (3.08) than 77.55% of its industry peers.
A Quick Ratio of 1.26 indicates that WSO.B should not have too much problems paying its short term obligations.
WSO.B has a Quick ratio of 1.26. This is comparable to the rest of the industry: WSO.B outperforms 51.02% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 3.08 | ||
| Quick Ratio | 1.26 |
3. Growth
3.1 Past
The earnings per share for WSO.B have decreased by -0.20% in the last year.
Measured over the past years, WSO.B shows a quite strong growth in Earnings Per Share. The EPS has been growing by 15.67% on average per year.
The Revenue has been growing slightly by 0.98% in the past year.
The Revenue has been growing by 9.81% on average over the past years. This is quite good.
EPS 1Y (TTM)-0.2%
EPS 3Y7.25%
EPS 5Y15.67%
EPS Q2Q%0.76%
Revenue 1Y (TTM)0.98%
Revenue growth 3Y6.65%
Revenue growth 5Y9.81%
Sales Q2Q%-3.59%
3.2 Future
Based on estimates for the next years, WSO.B will show a quite strong growth in Earnings Per Share. The EPS will grow by 11.39% on average per year.
WSO.B is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 6.81% yearly.
EPS Next Y9.48%
EPS Next 2Y8.97%
EPS Next 3Y10.25%
EPS Next 5Y11.39%
Revenue Next Year4.93%
Revenue Next 2Y5.09%
Revenue Next 3Y5.37%
Revenue Next 5Y6.81%
3.3 Evolution
Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 33.35, which means the current valuation is very expensive for WSO.B.
63.27% of the companies in the same industry are cheaper than WSO.B, based on the Price/Earnings ratio.
Compared to an average S&P500 Price/Earnings ratio of 27.06, WSO.B is valued a bit more expensive.
WSO.B is valuated quite expensively with a Price/Forward Earnings ratio of 27.63.
63.27% of the companies in the same industry are cheaper than WSO.B, based on the Price/Forward Earnings ratio.
The average S&P500 Price/Forward Earnings ratio is at 22.69. WSO.B is valued slightly more expensive when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 33.35 | ||
| Fwd PE | 27.63 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, WSO.B is valued a bit more expensive than the industry average as 73.47% of the companies are valued more cheaply.
WSO.B's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 44.63 | ||
| EV/EBITDA | 22.25 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates WSO.B does not grow enough to justify the current Price/Earnings ratio.
WSO.B has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)3.52
PEG (5Y)2.13
EPS Next 2Y8.97%
EPS Next 3Y10.25%
5. Dividend
5.1 Amount
WSO.B has a Yearly Dividend Yield of 2.82%.
WSO.B's Dividend Yield is rather good when compared to the industry average which is at 1.69. WSO.B pays more dividend than 91.84% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.32, WSO.B pays a bit more dividend than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.82% |
5.2 History
The dividend of WSO.B is nicely growing with an annual growth rate of 11.05%!
WSO.B has paid a dividend for at least 10 years, which is a reliable track record.
WSO.B has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)11.05%
Div Incr Years11
Div Non Decr Years11
5.3 Sustainability
WSO.B pays out 90.85% of its income as dividend. This is not a sustainable payout ratio.
WSO.B's earnings are growing around the same pace than its dividend. As long as the earnings growth is kept the dividend growth is sustainable.
DP90.85%
EPS Next 2Y8.97%
EPS Next 3Y10.25%
NYSE:WSO.B (8/4/2025, 8:04:00 PM)
434.825
-2.66 (-0.61%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryTrading Companies & Distributors
Earnings (Last)
Earnings (Next)
Inst Owners106.25%
Inst Owner Change6.97%
Ins Owners0.38%
Ins Owner ChangeN/A
Market Cap17.61B
Analysts67.62
Price Target494.45 (13.71%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.82% |
Yearly Dividend9.55
Dividend Growth(5Y)11.05%
DP90.85%
Div Incr Years11
Div Non Decr Years11
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-11%
Min EPS beat(2)-15.33%
Max EPS beat(2)-6.66%
EPS beat(4)1
Avg EPS beat(4)-5.97%
Min EPS beat(4)-15.33%
Max EPS beat(4)9.8%
EPS beat(8)2
Avg EPS beat(8)-6.2%
EPS beat(12)4
Avg EPS beat(12)1.23%
EPS beat(16)7
Avg EPS beat(16)5.84%
Revenue beat(2)0
Avg Revenue beat(2)-8.48%
Min Revenue beat(2)-8.58%
Max Revenue beat(2)-8.37%
Revenue beat(4)1
Avg Revenue beat(4)-4.32%
Min Revenue beat(4)-8.58%
Max Revenue beat(4)4.34%
Revenue beat(8)2
Avg Revenue beat(8)-3%
Revenue beat(12)2
Avg Revenue beat(12)-3.22%
Revenue beat(16)4
Avg Revenue beat(16)-1.53%
PT rev (1m)-3.49%
PT rev (3m)-3.49%
EPS NQ rev (1m)-6.13%
EPS NQ rev (3m)-8.35%
EPS NY rev (1m)-0.17%
EPS NY rev (3m)-2.17%
Revenue NQ rev (1m)-3.7%
Revenue NQ rev (3m)-4.52%
Revenue NY rev (1m)-0.31%
Revenue NY rev (3m)-0.27%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 33.35 | ||
| Fwd PE | 27.63 | ||
| P/S | 2.35 | ||
| P/FCF | 44.63 | ||
| P/OCF | 41.29 | ||
| P/B | 6.38 | ||
| P/tB | 9.3 | ||
| EV/EBITDA | 22.25 |
EPS(TTM)13.04
EY3%
EPS(NY)15.74
Fwd EY3.62%
FCF(TTM)9.74
FCFY2.24%
OCF(TTM)10.53
OCFY2.42%
SpS185.33
BVpS68.14
TBVpS46.75
PEG (NY)3.52
PEG (5Y)2.13
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.44% | ||
| ROE | 17.88% | ||
| ROCE | 20.25% | ||
| ROIC | 16.15% | ||
| ROICexc | 17.56% | ||
| ROICexgc | 23.65% | ||
| OM | 9.87% | ||
| PM (TTM) | 6.58% | ||
| GM | 27.54% | ||
| FCFM | 5.26% |
ROA(3y)13.43%
ROA(5y)12.52%
ROE(3y)23.42%
ROE(5y)21.95%
ROIC(3y)20.81%
ROIC(5y)19.72%
ROICexc(3y)23.47%
ROICexc(5y)21.78%
ROICexgc(3y)31.07%
ROICexgc(5y)29.54%
ROCE(3y)26.1%
ROCE(5y)24.73%
ROICexcg growth 3Y-0.91%
ROICexcg growth 5Y8.07%
ROICexc growth 3Y0.61%
ROICexc growth 5Y9.42%
OM growth 3Y0.55%
OM growth 5Y5.7%
PM growth 3Y2.52%
PM growth 5Y6.74%
GM growth 3Y0.36%
GM growth 5Y2.05%
F-Score4
Asset Turnover1.59
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0.29 | ||
| Debt/EBITDA | 0 | ||
| Cap/Depr | 74.77% | ||
| Cap/Sales | 0.42% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 54.44% | ||
| Profit Quality | 79.96% | ||
| Current Ratio | 3.08 | ||
| Quick Ratio | 1.26 | ||
| Altman-Z | N/A |
F-Score4
WACC10.15%
ROIC/WACC1.59
Cap/Depr(3y)95.78%
Cap/Depr(5y)88.24%
Cap/Sales(3y)0.46%
Cap/Sales(5y)0.42%
Profit Quality(3y)117.3%
Profit Quality(5y)129.41%
High Growth Momentum
Growth
EPS 1Y (TTM)-0.2%
EPS 3Y7.25%
EPS 5Y15.67%
EPS Q2Q%0.76%
EPS Next Y9.48%
EPS Next 2Y8.97%
EPS Next 3Y10.25%
EPS Next 5Y11.39%
Revenue 1Y (TTM)0.98%
Revenue growth 3Y6.65%
Revenue growth 5Y9.81%
Sales Q2Q%-3.59%
Revenue Next Year4.93%
Revenue Next 2Y5.09%
Revenue Next 3Y5.37%
Revenue Next 5Y6.81%
EBIT growth 1Y1.38%
EBIT growth 3Y7.24%
EBIT growth 5Y16.07%
EBIT Next Year10.75%
EBIT Next 3Y10%
EBIT Next 5Y11.17%
FCF growth 1Y4.65%
FCF growth 3Y31.86%
FCF growth 5Y18.5%
OCF growth 1Y4.11%
OCF growth 3Y30.29%
OCF growth 5Y18.15%