Watsco (WSO)
NYSEIndustrialsIndustrial - DistributionSnapshot 2026-09-04
$315.13-0.08%
Close 2026-09-04 · 1-day change
NYSEIndustrialsIndustrial - DistributionSnapshot 2026-09-04
Broken: Primary pillar broken — Maintain stable quarterly revenue near $1.53 billion: Q2 FY26 rev $2.1B vs $1.53B target; Q1 FY26 rev $1.53B vs $1.53B target.
Watsco keeps stable revenue near $1.53 billion per quarter. It raised dividends 10% to $3.00 per share in Q1 2026. The company beat earnings by 11% in Q1 2026. These show steady cash flow and shareholder returns.
Revenue growth is weak and barely above flat. The recent equity sales may pressure capital allocation. Earnings estimates have slightly declined. These risks could limit profit and dividend growth.
The stock price is about 36% above our valuation level. Analysts expect roughly 7% revenue growth. Our view is more cautious on growth and capital allocation risks.
Breaks if: Failure to complete or integrate asset purchase by end 2026
Breaks if: dividend per share falls below $3.00 quarterly
This is not a price target or investment advice.
A long-form read on the 1–3 year hold thesis. It updates when the weekly evidence changes.
This investment represents a stable, long-term thesis focused on a company with a commitment to technology and dividend growth. The current state shows some fragility in earnings quality but a stable management team that is prioritizing key initiatives.
The market seems to have priced in a neutral valuation with a slight premium compared to peers. There is a low expectations gap, indicating that investors are not anticipating significant changes in performance in the near term.
Fundamentals may remain neutral in the near term due to recent earnings misses, although management is on track with technology investments and maintaining dividend payments. The company's recent performance has improved, but risks remain due to its history of earnings misses.
The thesis hinges on external factors such as the performance of sector bellwethers like GWW, FAST, and FERG. If these companies continue to perform well, it could provide a tailwind for WSO, while any negative guidance from them could pose risks.
The most important moves since the prior daily snapshot.
Yes, our read has weakened. The latest earnings miss has raised concerns about revenue growth. Softer earnings may hinder stable revenue growth and market share. Investors are betting on potential interest rate cuts, which could impact growth stocks.
as of 2026-09-04
Review the evidence to watch, what would become a concern, and what would make it less concerning.
Not investment advice. Scores describe historical and current data; they are not forecasts of future returns. Consult a licensed advisor before making investment decisions.
Continue to prioritize dividend payments with a recent 10% increase to $13.20 per share.
Breaks if: EPS falls below $12.63 for FY 2026
Breaks if: quarterly revenue falls below $1.53 billion
Overall, WSO's long-term outlook is cautious but stable, with a focus on technology and dividends. Not investment advice.