Watsco (WSO)
NYSEIndustrialsIndustrial - DistributionSnapshot 2026-11-05
$311.14-2.62%
Close 2026-11-05 · 1-day change
NYSEIndustrialsIndustrial - DistributionSnapshot 2026-11-05
QuarterlyIQ Insights · WSO
How strong the business is — where it ranks within its sector on capital efficiency and cash generation, and how well management has been executing.
How this business ranks within industrials on a research-validated quality screen. As of 2026-11-05.
The screen ranks WSO against its sector on four durable signals: share dilution, return on capital, free-cash-flow yield, and FCF margin. Historically the highest-quality names tended toward better typical outcomes and fewer bad years over multi-year holds (strongest at three years, modest at one), and that pattern showed up even before the price moved. It characterizes business quality, not price direction.
Each leg is a sector-relative percentile (higher is better); 3 of 4 legs were available for this name. The composite is built from these four; the raw value follows each percentile for context.
A forward quality tilt, not a price prediction, and context for your own research rather than a recommendation. Not investment advice.
How management runs the business: capital, margins, balance sheet, and how reliably they guide and deliver.
Each factor is a parallel diagnostic with a clear read of what it shows and how names like it have historically fared. Never aggregated into a single score.
Operating income rose in 2 of the last 3 quarter-over-quarter moves. Historically, Industrials names rated neutral grew net income 51% of the time over the next year (vs 61% for the rest of the cohort, n=9285).
Not investment advice. Scores describe historical and current data; they are not forecasts of future returns. Consult a licensed advisor before making investment decisions.
A guidance track record builds as the company issues and delivers on guidance.
Priorities management has stated in recent disclosures, with status and evidence drawn from earnings calls, filings, and press releases.
Our focus remains on advancing these unique capabilities – with AI enabling better and faster speed to market – in ways that help our customers grow.”
Stated in 4 of 4 supplied quarters. Management reported: “Watsco has invested more than $250 million in its digital platforms over the last five years, at a current annual run rate of approximately $68 million, and the breadth of that investment spans across the customer-engagement, internal platforms to increase the speed and efficiency of our locations and emerging AI capabilities that help customers grow and deliver technical know-how quicker.” “The Company is now advancing AI-driven initiatives to leverage its extensive data assets to enhance the customer experience and improve efficiencies.”
“Our focus remains on advancing these unique capabilities – with AI enabling better and faster speed to market – in ways that help our customers grow.””
“Watsco has invested more than $250 million in its digital platforms over the last five years, at a current annual run rate of approximately $68 million, and the breadth of that investment spans acros…”
“The Company is now advancing AI-driven initiatives to leverage its extensive data assets to enhance the customer experience and improve efficiencies.”
“The Company is now advancing AI-driven initiatives to leverage its extensive data assets to enhance the customer experience and improve efficiencies.”
The Company’s philosophy is to share cash flow through dividends while maintaining a conservative balance sheet with continued capacity to build its distribution network.
Stated in 4 of 4 supplied quarters. Management reported: “Watsco also announced that it has entered into an agreement to acquire Jackson Supply Company, one of the largest Sunbelt HVAC distributors, with annual sales of $230 million.” “The Company continues to actively seek new businesses that will join the Watsco family.”
“The Company’s philosophy is to share cash flow through dividends while maintaining a conservative balance sheet with continued capacity to build its distribution network.”
The Company’s philosophy is to share cash flow through dividends while maintaining a conservative balance sheet with continued capacity to build its distribution network.
Stated in 4 of 4 supplied quarters. Management reported: “Watsco also announced today a 10% increase in its annual dividend to $13.20 per share effective with its next regular dividend payment in April 2026.” “The Company’s philosophy is to share cash flow through dividends while maintaining a conservative balance sheet with continued capacity to build its distribution network.”
Watsco’s stated goal is to generate annual operating cash flow in excess of net income.
Stated in 4 of 4 supplied quarters. Management reported: “The Company expects more conventional working capital trends going forward, providing the opportunity for better inventory turns and enhanced returns on invested capital.” “With the A2L transition largely complete, the Company is focused on growth with existing customers, acquisition of new customers, improved operating efficiencies and optimizing inventory given a simpler operating environment.”
“Watsco’s stated goal is to generate annual operating cash flow in excess of net income.”
Pursue growth with existing and new customers and extend Watsco’s position in the HVAC/R distribution market.
Over the trailing year it converted 0.48x of net income into operating cash flow. Historically, Industrials names rated fragile grew net income 50% of the time over the next year (vs 59% for the rest of the cohort, n=5006).
Most sensitive to the broad stock market and long-term interest rates.
Not enough signal to read sensitivity to the US dollar, Fed net liquidity (low R² over the window).
8 material management or governance events in the past 24 months, led by capital-allocation actions. Historically, Industrials names rated neutral grew net income 59% of the time over the next year (vs 56% for the rest of the cohort, n=8936).
Not investment advice. As of 2026-11-05.
“The Company continues to actively seek new businesses that will join the Watsco family.”
“Watsco also announced that it has entered into an agreement to acquire Jackson Supply Company, one of the largest Sunbelt HVAC distributors, with annual sales of $230 million.”
“Our “buy and build” strategy builds upon their long-standing legacies through investment in new locations, new products and by leveraging Watsco’s technology platforms.”
“The Company’s philosophy is to share cash flow through dividends while maintaining a conservative balance sheet with continued capacity to build its distribution network.”
“The Company’s philosophy is to share cash flow through dividends while maintaining a conservative balance sheet with continued capacity to build its distribution network.”
“The Company’s philosophy is to share cash flow through dividends while 2 maintaining a conservative balance sheet with continued capacity to build its distribution network.”
“Watsco also announced today a 10% increase in its annual dividend to $13.20 per share effective with its next regular dividend payment in April 2026.”
“With the A2L transition largely complete, the Company is focused on growth with existing customers, acquisition of new customers, improved operating efficiencies and optimizing inventory given a simp…”
“The Company expects more conventional working capital trends going forward, providing the opportunity for better inventory turns and enhanced returns on invested capital.”
“The Company expects more conventional working capital trends going forward, providing the opportunity for better inventory turns and enhanced returns on invested capital.”