Zacks Research Weighs in on Watsco’s Q2 Earnings (NYSE:WSO)

Watsco, Inc. (NYSE:WSO) – Investment analysts at Zacks Research cut their Q2 2026 earnings estimates for shares of Watsco in a report issued on Tuesday, May 19th. Zacks Research analyst Team now expects that the construction company will post earnings per share of $4.25 for the quarter, down from their prior forecast of $4.27. Zacks Research has a “Hold” rating on the stock. The consensus estimate for Watsco’s current full-year earnings is $12.70 per share. Zacks Research also issued estimates for Watsco’s Q4 2026 earnings at $2.15 EPS, FY2027 earnings at $13.70 EPS, Q1 2028 earnings at $1.93 EPS and FY2028 earnings at $14.93 EPS.

Watsco (NYSE:WSO) last released its earnings results on Tuesday, April 28th. The construction company reported $1.87 earnings per share for the quarter, topping analysts’ consensus estimates of $1.73 by $0.14. Watsco had a net margin of 6.85% and a return on equity of 15.31%. The business had revenue of $1.53 billion for the quarter, compared to analyst estimates of $1.49 billion. During the same period last year, the company posted $1.93 EPS. The business’s revenue was up .1% on a year-over-year basis.

Other research analysts have also issued reports about the stock. Mizuho set a $425.00 target price on shares of Watsco in a research note on Wednesday, February 18th. Wall Street Zen raised shares of Watsco from a “sell” rating to a “hold” rating in a research report on Saturday, May 2nd. JPMorgan Chase & Co. lifted their price target on shares of Watsco from $370.00 to $400.00 and gave the company a “neutral” rating in a research report on Thursday, February 19th. Finally, Stephens lifted their price target on shares of Watsco from $475.00 to $485.00 and gave the company an “overweight” rating in a research report on Wednesday, April 29th. One investment analyst has rated the stock with a Buy rating and eight have assigned a Hold rating to the stock. Based on data from MarketBeat, Watsco currently has a consensus rating of “Hold” and an average target price of $399.83.

Watsco Price Performance

WSO opened at $386.53 on Thursday. The company’s 50 day simple moving average is $399.50 and its two-hundred day simple moving average is $381.07. Watsco has a 1-year low of $323.05 and a 1-year high of $494.94. The firm has a market capitalization of $15.72 billion, a price-to-earnings ratio of 32.08 and a beta of 1.12.

Institutional Trading of Watsco

A number of institutional investors and hedge funds have recently added to or reduced their stakes in WSO. Empowered Funds LLC raised its position in Watsco by 4.1% in the first quarter. Empowered Funds LLC now owns 5,927 shares of the construction company’s stock valued at $3,013,000 after purchasing an additional 232 shares during the period. Bank of Nova Scotia raised its position in Watsco by 95.0% in the second quarter. Bank of Nova Scotia now owns 1,297 shares of the construction company’s stock valued at $573,000 after purchasing an additional 632 shares during the period. Sei Investments Co. raised its position in Watsco by 7.6% in the second quarter. Sei Investments Co. now owns 50,442 shares of the construction company’s stock valued at $22,275,000 after purchasing an additional 3,570 shares during the period. Treasurer of the State of North Carolina raised its position in Watsco by 2.8% in the second quarter. Treasurer of the State of North Carolina now owns 16,258 shares of the construction company’s stock valued at $7,180,000 after purchasing an additional 437 shares during the period. Finally, Diversify Advisory Services LLC raised its position in Watsco by 12.0% in the second quarter. Diversify Advisory Services LLC now owns 523 shares of the construction company’s stock valued at $221,000 after purchasing an additional 56 shares during the period. Hedge funds and other institutional investors own 89.71% of the company’s stock.

Watsco Increases Dividend

The company also recently declared a quarterly dividend, which was paid on Thursday, April 30th. Stockholders of record on Thursday, April 16th were given a dividend of $3.30 per share. This represents a $13.20 annualized dividend and a dividend yield of 3.4%. The ex-dividend date of this dividend was Thursday, April 16th. This is a boost from Watsco’s previous quarterly dividend of $3.00. Watsco’s dividend payout ratio is presently 109.54%.

About Watsco

Watsco, Inc is the largest distributor of heating, ventilation, air conditioning and refrigeration (HVAC/R) equipment, parts and supplies in the United States. Headquartered in Miami, Florida, the company operates a network of more than 600 branches across the continental U.S., Canada and Puerto Rico. Watsco serves residential and commercial contractors by providing essential components for climate control systems, including air conditioners, furnaces, heat pumps, coils, refrigerants, controls and electrical and piping supplies.

Founded in 1947, Watsco has grown from a single regional distributor into an industry leader through a combination of organic expansion, acquisitions and strategic partnerships with original equipment manufacturers such as Carrier, Trane, Goodman and Lennox.