Watsco
WSONYSEUSD
- Source valuation snapshot. Not a live recalculation.
- Latest filed annual earnings; price snapshot date unavailable. Not forward P/E.
- Diluted earnings per share from the latest filed annual.
- $311.47 Prior regular-session close from the quote source.
- $306.38–$315.63 Regular-session low and high so far today.
- 640.4K Regular-session shares traded · Nov 11, 4:00 PM ET.
- Feb 16 projected Projected for 2027-02-16 from the company’s own results filings (SEC 8-K Item 2.02). The company has not confirmed the date.
- $277.34–$459.00 52-week trading low and high returned by the quote source.
Understand the Business
Why the Stock Moved
Period-matched expectations history is not yet available. Current metrics are not a substitute for a historical explanation.
The core investment thesis
Own WSO if Watsco converts scale, a dense branch network and OEM relationships into durable distributor economics: steady gross margins, high cash conversion, and repeatable acquisition-fueled growth that funds buybacks and EPS compounding.
WSO price history
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Investment thesis
What must happen next
Watsco's dense branch network and OEM/distributor relationships create local availability and customer stickiness that preserve pricing and gross margin versus smaller competitors or pure e‑commerce entrants.StrengtheningMateriality: High
gross_profit (2025 = 2030464000.0 USD, annual). If true, Watsco keeps per‑unit gross profit and pricing power, protecting operating profits and cash flow; if false, gross margins will compress and cash conversion will fall.
Watch: A major OEM (e.g., Carrier or Daikin) shifts to factory‑direct distribution or terminates key regional distribution agreements, reducing Watsco's exclusive access and forcing price competition.
Supporting sources
Source notes are factual paraphrases; read the original disclosures below.
gross_profit (2025 = 2030464000.0 USD, annual).
Open source ↗Acquisitions and tuck‑ins are the primary lever to sustainably grow revenue faster than the mature replacement market alone; continued access to accretive targets is therefore essential for above‑market growth.HoldingMateriality: High
business_text: 'Our revenues in HVAC/R distribution have increased from $64.1 million in 1989 to $7.2 billion in 2025, resulting from our strategic acquisition of companies with established market positions and subsequent building of revenues and profit...'. If Watsco can continue disciplined roll‑ups, revenue and EPS will compound even with modest organic growth; if M&A dries up or becomes unaccretive, top‑line and EPS growth will slow and the stock's premium multiple will be harder to justify.
Watch: Tighter valuations or competition for targets that makes tuck‑ins uneconomic, reducing M&A cadence.
Supporting sources
Source notes are factual paraphrases; read the original disclosures below.
business_text: 'Our revenues in HVAC/R distribution have increased from $64.1 million in 1989 to $7.2 billion in 2025, resulting from.
Open source ↗High operating cash flow conversion from distribution operations funds share repurchases and acquisitions, converting scale into per‑share compounding even if organic revenue growth is modest.HoldingMateriality: Medium
operating_cash_flow (2025 = 569613000.0 USD, annual. Durable cash generation gives management optionality to buy growth or return capital; if cash flow weakens, the buyback/M&A engine stalls and EPS growth will slow.
Watch: Working capital stress (inventory build or slower collections) or vendor term shifts that materially reduce operating cash flow conversion.
Supporting sources
Source notes are factual paraphrases; read the original disclosures below.
operating_cash_flow (2025 = 569613000.0 USD, annual.
Open source ↗
Full investment case & evidence
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Original research
Watsco's dense branch network and OEM/distributor relationships create local availability and customer stickiness that preserve pricing and gross margin versus smaller competitors or pure e‑commerce entrants. If true, Watsco keeps per‑unit gross profit and pricing power, protecting operating profits and cash flow; if false, gross margins will compress and cash conversion will fall.
Acquisitions and tuck‑ins are the primary lever to sustainably grow revenue faster than the mature replacement market alone; continued access to accretive targets is therefore essential for above‑market growth. If Watsco can continue disciplined roll‑ups, revenue and EPS will compound even with modest organic growth; if M&A dries up or becomes unaccretive, top‑line and EPS growth will slow and the stock's premium multiple will be harder to justify.
High operating cash flow conversion from distribution operations funds share repurchases and acquisitions, converting scale into per‑share compounding even if organic revenue growth is modest. Durable cash generation gives management optionality to buy growth or return capital; if cash flow weakens, the buyback/M&A engine stalls and EPS growth will slow.
All standing thesis claims
Original report summary
Watsco converts scale, a dense branch network and OEM relationships into durable distributor economics: steady gross margins, high cash conversion, and repeatable acquisition-fueled growth that funds buybacks and EPS compounding.
Bull case and bear case
Bull case and bear case for Watsco
Where the evidence on Watsco stands: Holding on the latest evidence (Nov 7, 2026). Of its 3 thesis points, 1 strengthening and 2 holding.
Bull case: what the evidence supports
Watsco's dense branch network and OEM/distributor relationships create local availability and customer stickiness that preserve pricing and gross margin versus smaller competitors or pure e‑commerce entrants.
Acquisitions and tuck‑ins are the primary lever to sustainably grow revenue faster than the mature replacement market alone; continued access to accretive targets is therefore essential for above‑market growth.
High operating cash flow conversion from distribution operations funds share repurchases and acquisitions, converting scale into per‑share compounding even if organic revenue growth is modest.
Bear case: what would count against it
A major OEM (e.g., Carrier or Daikin) shifts to factory‑direct distribution or terminates key regional distribution agreements, reducing Watsco's exclusive access and forcing price competition.
Tighter valuations or competition for targets that makes tuck‑ins uneconomic, reducing M&A cadence.
Working capital stress (inventory build or slower collections) or vendor term shifts that materially reduce operating cash flow conversion.
Thesis-Break Engine
Thesis-break watch · Watsco
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MARKET + FINANCIAL SNAPSHOT
The numbers behind the thesis
What Changed
- MixedEntered a material definitive agreement.
Watsco filed an SEC 8-K on 2026-10-27: Entered a material definitive agreement. It is a dated development that tests the current thesis.
- MixedReported results of operations (earnings release).
Watsco filed an SEC 8-K on 2026-10-27: Reported results of operations (earnings release). It is a dated development that tests the current thesis.
- MixedUnregistered sale of equity securities.
Watsco filed an SEC 8-K on 2026-09-17: Unregistered sale of equity securities. It is a dated development that tests the current thesis.
Risks / falsifiers
What could break the thesis
- A major OEM (e.g., Carrier or Daikin) shifts to factory‑direct distribution or terminates key regional distribution agreements, reducing Watsco's exclusive access and forcing price competition.
- Tighter valuations or competition for targets that makes tuck‑ins uneconomic, reducing M&A cadence.
- Working capital stress (inventory build or slower collections) or vendor term shifts that materially reduce operating cash flow conversion.
WSO news
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Financial statements
WSO income statement
Annual filed results · USD · Oldest to newest. Margins are calculated from the reported figures.
WSO: quick answers
- When does Watsco (WSO) report earnings next?
- Watsco's next results are projected for February 16, 2027, from the dates of its own results filings with the SEC. The company has not confirmed the date. It last reported on October 27, 2026. Earnings calendar
- What is WSO's short interest?
- As of October 30, 2026, 4.9M WSO shares were sold short, 13.7% of its shares outstanding, up 4.8% from the count before. At the stock's average daily volume that is 6.1 days to cover. FINRA publishes the count twice a month. WSO short interest history
- Have members of Congress traded WSO?
- Reports made public in the last 90 days disclose 3 trades in WSO by 1 filer: 2 purchases and 1 sale. They are filed under the STOCK Act by members of Congress, the President and senior officials. Every disclosed WSO trade
- Which well-known investors own WSO?
- 2 of the 37 well-known funds tracked here reported WSO shares in their latest 13F filings. By share of the fund's portfolio: Markel Group (Tom Gayner), 1.5%; Bridgewater Associates (Ray Dalio), 0.1%. Fund portfolios
WSO in well-known investors’ portfolios
2 of 37 funds reported WSO shares in their latest 13F filing. A 13F shows quarter-end positions and arrives up to 45 days later.
| Fund | Of its portfolio | Value | Change | Quarter |
|---|---|---|---|---|
| Tom GaynerMarkel Group | 1.5% | $189M | +4.2% | Q3 2026 |
| Ray DalioBridgewater Associates | 0.08% | $20.0M | New | Q2 2026 |