WATSCO INC -CL B (WSO.B)
US9426221019 - Common Stock
Taking everything into account, WSO.B scores 6 out of 10 in our fundamental rating. WSO.B was compared to 49 industry peers in the Trading Companies & Distributors industry. Both the health and profitability get an excellent rating, making WSO.B a very profitable company, without any liquidiy or solvency issues. While showing a medium growth rate, WSO.B is valued expensive at the moment.
1. Profitability
1.1 Basic Checks
WSO.B had positive earnings in the past year.
In the past year WSO.B had a positive cash flow from operations.
Each year in the past 5 years WSO.B has been profitable.
WSO.B had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
With an excellent Return On Assets value of 10.73%, WSO.B belongs to the best of the industry, outperforming 87.50% of the companies in the same industry.
With a decent Return On Equity value of 17.99%, WSO.B is doing good in the industry, outperforming 64.58% of the companies in the same industry.
With an excellent Return On Invested Capital value of 16.67%, WSO.B belongs to the best of the industry, outperforming 91.67% 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 9.86%.
The 3 year average ROIC (22.74%) for WSO.B is well above the current ROIC(16.67%). The reason for the recent decline needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.73% | ||
| ROE | 17.99% | ||
| ROIC | 16.67% |
ROA(3y)13.84%
ROA(5y)12.05%
ROE(3y)24.81%
ROE(5y)21.34%
ROIC(3y)22.74%
ROIC(5y)19.68%
1.3 Margins
With a decent Profit Margin value of 6.49%, WSO.B is doing good in the industry, outperforming 68.75% of the companies in the same industry.
In the last couple of years the Profit Margin of WSO.B has grown nicely.
With a decent Operating Margin value of 9.69%, WSO.B is doing good in the industry, outperforming 62.50% of the companies in the same industry.
In the last couple of years the Operating Margin of WSO.B has grown nicely.
WSO.B's Gross Margin of 26.66% is on the low side compared to the rest of the industry. WSO.B is outperformed by 62.50% of its industry peers.
In the last couple of years the Gross Margin of WSO.B has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 9.69% | ||
| PM (TTM) | 6.49% | ||
| GM | 26.66% |
OM growth 3Y11.03%
OM growth 5Y5.75%
PM growth 3Y12.04%
PM growth 5Y6.92%
GM growth 3Y4.18%
GM growth 5Y2.11%
2. Health
2.1 Basic Checks
WSO.B has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
The number of shares outstanding for WSO.B has been increased compared to 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
An Altman-Z score of 10.28 indicates that WSO.B is not in any danger for bankruptcy at the moment.
The Altman-Z score of WSO.B (10.28) is better than 91.67% of its industry peers.
The Debt to FCF ratio of WSO.B is 0.02, which is an excellent value as it means it would take WSO.B, only 0.02 years of fcf income to pay off all of its debts.
WSO.B has a better Debt to FCF ratio (0.02) than 93.75% of its industry peers.
WSO.B has a Debt/Equity ratio of 0.01. This is a healthy value indicating a solid balance between debt and equity.
With an excellent Debt to Equity ratio value of 0.01, WSO.B belongs to the best of the industry, outperforming 89.58% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.01 | ||
| Debt/FCF | 0.02 | ||
| Altman-Z | 10.28 |
ROIC/WACC1.41
WACC11.81%
2.3 Liquidity
A Current Ratio of 3.36 indicates that WSO.B has no problem at all paying its short term obligations.
WSO.B's Current ratio of 3.36 is amongst the best of the industry. WSO.B outperforms 85.42% of its industry peers.
WSO.B has a Quick Ratio of 1.65. This is a normal value and indicates that WSO.B is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 1.65, WSO.B is in the better half of the industry, outperforming 72.92% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 3.36 | ||
| Quick Ratio | 1.65 |
3. Growth
3.1 Past
The earnings per share for WSO.B have decreased strongly by -14.59% in the last year.
WSO.B shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 16.30% yearly.
WSO.B shows a small growth in Revenue. In the last year, the Revenue has grown by 2.83%.
WSO.B shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 9.88% yearly.
EPS 1Y (TTM)-14.59%
EPS 3Y25.69%
EPS 5Y16.3%
EPS Q2Q%-2.99%
Revenue 1Y (TTM)2.83%
Revenue growth 3Y12.95%
Revenue growth 5Y9.88%
Sales Q2Q%1.56%
3.2 Future
Based on estimates for the next years, WSO.B will show a small growth in Earnings Per Share. The EPS will grow by 6.79% on average per year.
Based on estimates for the next years, WSO.B will show a small growth in Revenue. The Revenue will grow by 7.66% on average per year.
EPS Next Y-2%
EPS Next 2Y4.78%
EPS Next 3Y7.14%
EPS Next 5Y6.79%
Revenue Next Year2.78%
Revenue Next 2Y4.56%
Revenue Next 3Y5.22%
Revenue Next 5Y7.66%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
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
With a Price/Earnings ratio of 36.32, WSO.B can be considered very expensive at the moment.
70.83% of the companies in the same industry are cheaper than WSO.B, based on the Price/Earnings ratio.
The average S&P500 Price/Earnings ratio is at 27.28. WSO.B is valued slightly more expensive when compared to this.
Based on the Price/Forward Earnings ratio of 31.34, the valuation of WSO.B can be described as expensive.
66.67% of the companies in the same industry are cheaper than WSO.B, based on the Price/Forward Earnings ratio.
WSO.B is valuated rather expensively when we compare the Price/Forward Earnings ratio to 23.53, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 36.32 | ||
| Fwd PE | 31.34 |
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 79.17% of the companies are valued more cheaply.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of WSO.B indicates a somewhat cheap valuation: WSO.B is cheaper than 60.42% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 32.67 | ||
| EV/EBITDA | 27.37 |
4.3 Compensation for Growth
The excellent profitability rating of WSO.B may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)2.23
EPS Next 2Y4.78%
EPS Next 3Y7.14%
5. Dividend
5.1 Amount
WSO.B has a Yearly Dividend Yield of 1.95%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 1.87, WSO.B pays a better dividend. On top of this WSO.B pays more dividend than 85.42% of the companies listed in the same industry.
WSO.B's Dividend Yield is comparable with the S&P500 average which is at 2.33.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.95% |
5.2 History
The dividend of WSO.B is nicely growing with an annual growth rate of 11.93%!
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)11.93%
Div Incr Years11
Div Non Decr Years11
5.3 Sustainability
WSO.B pays out 84.75% of its income as dividend. This is not a sustainable payout ratio.
WSO.B's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP84.75%
EPS Next 2Y4.78%
EPS Next 3Y7.14%
WATSCO INC -CL B
NYSE:WSO.B (1/6/2025, 8:09:02 PM)
469.95
-65.05 (-12.16%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryTrading Companies & Distributors
Earnings (Last)
Earnings (Next)
Inst Owners0.05%
Inst Owner Change0%
Ins OwnersN/A
Ins Owner ChangeN/A
Market Cap21.58B
Analysts68.89
Price Target480.39 (2.22%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.95% |
Dividend Growth(5Y)11.93%
DP84.75%
Div Incr Years11
Div Non Decr Years11
Ex-DateN/A
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-8.4%
Min EPS beat(2)-11.69%
Max EPS beat(2)-5.12%
EPS beat(4)0
Avg EPS beat(4)-9.46%
Min EPS beat(4)-15.46%
Max EPS beat(4)-5.12%
EPS beat(8)3
Avg EPS beat(8)4.46%
EPS beat(12)5
Avg EPS beat(12)8.62%
EPS beat(16)9
Avg EPS beat(16)11.98%
Revenue beat(2)0
Avg Revenue beat(2)-3.83%
Min Revenue beat(2)-4.68%
Max Revenue beat(2)-2.98%
Revenue beat(4)0
Avg Revenue beat(4)-3.55%
Min Revenue beat(4)-4.68%
Max Revenue beat(4)-2.8%
Revenue beat(8)1
Avg Revenue beat(8)-3.09%
Revenue beat(12)3
Avg Revenue beat(12)-0.71%
Revenue beat(16)6
Avg Revenue beat(16)4.64%
PT rev (1m)0%
PT rev (3m)0%
EPS NQ rev (1m)-5.84%
EPS NQ rev (3m)-5.84%
EPS NY rev (1m)-4.82%
EPS NY rev (3m)-4.86%
Revenue NQ rev (1m)-1.64%
Revenue NQ rev (3m)-1.64%
Revenue NY rev (1m)-1.39%
Revenue NY rev (3m)-1.37%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 36.32 | ||
| Fwd PE | 31.34 | ||
| P/S | 2.89 | ||
| P/FCF | 32.67 | ||
| P/OCF | 31.16 | ||
| P/B | 8.01 | ||
| P/tB | 10.66 | ||
| EV/EBITDA | 27.37 |
EPS(TTM)12.94
EY2.75%
EPS(NY)15
Fwd EY3.19%
FCF(TTM)14.39
FCFY3.06%
OCF(TTM)15.08
OCFY3.21%
SpS162.59
BVpS58.71
TBVpS44.11
PEG (NY)N/A
PEG (5Y)2.23
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.73% | ||
| ROE | 17.99% | ||
| ROCE | 20.19% | ||
| ROIC | 16.67% | ||
| ROICexc | 19.69% | ||
| ROICexgc | 25.28% | ||
| OM | 9.69% | ||
| PM (TTM) | 6.49% | ||
| GM | 26.66% | ||
| FCFM | 8.85% |
ROA(3y)13.84%
ROA(5y)12.05%
ROE(3y)24.81%
ROE(5y)21.34%
ROIC(3y)22.74%
ROIC(5y)19.68%
ROICexc(3y)24.16%
ROICexc(5y)20.89%
ROICexgc(3y)32.45%
ROICexgc(5y)28.64%
ROCE(3y)27.54%
ROCE(5y)23.83%
ROICexcg growth 3Y5.49%
ROICexcg growth 5Y3.25%
ROICexc growth 3Y9.16%
ROICexc growth 5Y5.36%
OM growth 3Y11.03%
OM growth 5Y5.75%
PM growth 3Y12.04%
PM growth 5Y6.92%
GM growth 3Y4.18%
GM growth 5Y2.11%
F-Score5
Asset Turnover1.65
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.01 | ||
| Debt/FCF | 0.02 | ||
| Debt/EBITDA | 0.02 | ||
| Cap/Depr | 80.06% | ||
| Cap/Sales | 0.43% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 90.72% | ||
| Profit Quality | 136.26% | ||
| Current Ratio | 3.36 | ||
| Quick Ratio | 1.65 | ||
| Altman-Z | 10.28 |
F-Score5
WACC11.81%
ROIC/WACC1.41
Cap/Depr(3y)101.39%
Cap/Depr(5y)88.03%
Cap/Sales(3y)0.46%
Cap/Sales(5y)0.42%
Profit Quality(3y)95.96%
Profit Quality(5y)127.83%
High Growth Momentum
Growth
EPS 1Y (TTM)-14.59%
EPS 3Y25.69%
EPS 5Y16.3%
EPS Q2Q%-2.99%
EPS Next Y-2%
EPS Next 2Y4.78%
EPS Next 3Y7.14%
EPS Next 5Y6.79%
Revenue 1Y (TTM)2.83%
Revenue growth 3Y12.95%
Revenue growth 5Y9.88%
Sales Q2Q%1.56%
Revenue Next Year2.78%
Revenue Next 2Y4.56%
Revenue Next 3Y5.22%
Revenue Next 5Y7.66%
EBIT growth 1Y-9.37%
EBIT growth 3Y25.41%
EBIT growth 5Y16.2%
EBIT Next Year-2.86%
EBIT Next 3Y6.99%
EBIT Next 5Y6.75%
FCF growth 1Y86.9%
FCF growth 3Y0.54%
FCF growth 5Y27.97%
OCF growth 1Y78.21%
OCF growth 3Y1.69%
OCF growth 5Y26.92%