- Watsco’s earnings per share (EPS) for the first quarter were $1.93, falling short of the previous year’s $2.17 and lower than the estimated $2.28.
- The company reported revenue of $1.53 billion, which is a 2.2% decline compared to the previous year and below the anticipated $1.65 billion.
- The operating margin dropped to 7.3%, down from last year’s 8.1%, and was below the expected 8.29%.
- On a positive note, the gross margin improved to 28.1%, up from 27.5% the previous year, and surpassed the estimate of 27.3%.
- Watsco’s OEM partners and suppliers are evaluating the effects of tariffs and other inflationary pressures, leading to various pricing actions.
- Despite the uncertainty around tariffs, Watsco remains focused on the HVAC replacement market, which is considered stable due to its essential role in ensuring comfort and healthy environments.
- Investment analysts’ ratings include 3 buys, 11 holds, and 2 sells.
“`
Watsco Inc on Smartkarma
Analyst coverage on Smartkarma, a platform for independent research, has shed light on Watsco Inc, the largest distributor of HVAC equipment in North America. Business Breakdowns, in episode 209 titled “Watsco: Air Apparent,” unveiled how Watsco has thrived by bridging the gap between manufacturers and contractors. Their diverse range of products, technical knowledge, and added services have cemented their position as a vital partner to contractors in the industry.
The analysis from Business Breakdowns showcases Watsco’s evolution from a manufacturer to a distributor in 1989, triggering significant expansion and consistent shareholder returns. This demonstrates the company’s resilience and adaptability in catering to the needs of its customers. The overall sentiment of the coverage leans towards bullish, emphasizing Watsco’s strategic positioning and growth prospects in the competitive HVAC market.
A look at Watsco Inc Smart Scores
| Factor | Score | Magnitude |
|---|---|---|
| Value | 2 | |
| Dividend | 3 | |
| Growth | 4 | |
| Resilience | 4 | |
| Momentum | 5 | |
| OVERALL SMART SCORE | 3.6 |
Smart Score is a compound score for the Company indicating its overall outlook. It is derived by taking an equally weighted average of underlying Factor scores computed by Smartkarma
Watsco Inc, a company distributing air conditioning, heating, and refrigeration equipment in the United States, shows a promising long-term outlook based on its Smartkarma Smart Scores. With a solid score of 4 for Growth and Resilience, Watsco Inc is positioned for sustained expansion and durability in the market. This indicates positive prospects for the company’s future performance and stability.
Additionally, Watsco Inc demonstrates strong momentum with a score of 5, showcasing its ability to maintain or accelerate its upward trend. Although the Value and Dividend scores are slightly lower, at 2 and 3 respectively, the overall high scores in Growth, Resilience, and Momentum suggest a favorable outlook for Watsco Inc in the long run, supported by its strategic positioning in Sunbelt markets.
Disclaimer: This article by Smartkarma is general in nature and based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Note that our articles may not factor in the latest price-sensitive company announcements or qualitative material.
While all reasonable care has been taken in the preparation, Smartkarma makes no assurance about the accuracy of any generated data or content. All content is indicative only and should be independently checked for accuracy and confirmed before use. Smartkarma accepts no responsibility for any loss or damage caused as a result of any inaccuracy or error within the Lab online tools or generated data.
Have feedback on this article? Concerned about the content? Get in touch with us directly.
💡 Before it’s here, it’s on Smartkarma
Sign Up for Free
The Smartkarma Preview Pass is your entry to the Independent Investment Research Network
- ✓ Unlimited Research Summaries
- ✓ Personalised Alerts
- ✓ Custom Watchlists
- ✓ Company Analytics and News
- ✓ Events & Webinars
