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WSO

Watsco, Inc.

WSO

Watsco, Inc. • NYSE
$346.40 ▲ 0.23% (+0.80)
Market Cap $14.09 B
52w High $552.32
52w Low $323.05
Dividend Yield 11.70%
P/E 26.96
Volume 180.44K
Outstanding Shares 40.67M

Income Statement

Period Revenue Operating Expense Net Income Net Profit Margin Earnings Per Share EBITDA
Q3-2025 $2.067B ▲ $360.075M ▲ $189.23M ▲ 9.155% ▲ $3.98 ▼ $249.488M ▼
Q2-2025 $2.062B ▲ $331.619M ▲ $183.613M ▲ 8.903% ▲ $4.53 ▲ $282.779M ▲
Q1-2025 $1.531B ▼ $317.435M ▼ $80.061M ▼ 5.229% ▼ $1.93 ▼ $117.819M ▼
Q4-2024 $1.754B ▼ $331.896M ▲ $96.841M ▼ 5.521% ▼ $2.39 ▼ $140.086M ▼
Q3-2024 $2.16B $315.997M $171.031M 7.918% $4.24 $250.309M

Balance Statement

Period Cash & Short-term Total Assets Total Liabilities Total Equity
Q3-2025 $524.348M ▲ $4.555B ▼ $1.253B ▼ $2.815B ▲
Q2-2025 $292.978M ▼ $4.73B ▲ $1.508B ▲ $2.76B ▲
Q1-2025 $431.823M ▼ $4.454B ▼ $1.366B ▼ $2.665B ▲
Q4-2024 $781.94M ▲ $4.532B ▲ $1.468B ▲ $2.657B ▼
Q3-2024 $550.023M $4.517B $1.356B $2.696B

Cash Flow Statement

Period Net Income Cash From Operations Cash From Investing Cash From Financing Net Change Free Cash Flow
Q3-2025 $189.23M ▼ $354.937M ▲ $-208.773M ▼ $-113.57M ▼ $31.37M ▲ $346.428M ▲
Q2-2025 $216.768M ▲ $-7.446M ▲ $-22.304M ▼ $-112.554M ▲ $-138.845M ▼ $-14.283M ▲
Q1-2025 $94.54M ▼ $-177.644M ▼ $244.556M ▲ $-161.679M ▼ $-94.448M ▼ $-185.185M ▼
Q4-2024 $115.18M ▼ $378.897M ▲ $-7.951M ▲ $-133.469M ▼ $-23.752M ▼ $370.865M ▲
Q3-2024 $201.647M $232.764M $-65.404M $-98.871M $125.169M $222.968M

Five-Year Company Overview

Income Statement

Income Statement Revenue has grown meaningfully over the past several years, but has flattened out more recently. Profitability is solid: gross profit and operating profit remain healthy, although earnings appear to have peaked a couple of years ago and then eased slightly. Even with that softening, current profit levels are still well above where they were earlier in the period, suggesting the business has scaled well but is now in a more mature, slower‑growth, more cyclical phase tied to HVAC demand and pricing trends.

Balance Sheet

Balance Sheet The balance sheet looks sturdier over time. Total assets and shareholders’ equity have steadily increased, indicating reinvestment and retained earnings. Debt is present but does not look outsized relative to the company’s equity base, and cash has built up in recent years. Overall, Watsco appears to have a solid financial foundation with reasonable leverage and growing financial flexibility.

Cash Flow

Cash Flow Cash generation is a clear strength. Operating cash flow has trended upward and consistently covers the company’s modest capital spending needs, resulting in solid free cash flow year after year. Because the business is not very capital intensive, a large share of accounting profits is converting into cash, giving Watsco room to fund growth initiatives, absorb downturns, and return capital without stretching its finances.

Competitive Edge

Competitive Edge Watsco holds a leading position as the largest HVAC/R distributor in North America, operating in an industry that is still fragmented and local in nature. Its scale, broad branch network, deep manufacturer relationships, and extensive product catalog give it meaningful bargaining power and service advantages. The firm’s technology stack and digital tools deepen relationships with contractors and make switching less attractive, while its ongoing acquisition strategy helps expand territory and consolidate share. Together, these factors form a durable, though not unassailable, competitive moat.

Innovation and R&D

Innovation and R&D Instead of traditional lab-style R&D, Watsco’s innovation is centered on software, data, and digital tools for contractors. Its e‑commerce platforms, mobile apps, and proposal/financing tools aim to make it the easiest and most integrated place for contractors to do business. The company is layering on AI assistants for both employees and customers, and is preparing new platforms like WatscoOne for larger commercial buyers. This digital ecosystem, combined with data analytics and a focus on energy‑efficient and regulatory‑compliant products, suggests a steady push to modernize a historically low‑tech distribution niche.

Summary

Watsco combines a mature, cash‑generative distribution business with a clear strategic push into technology and data. Financially, it shows healthy margins, strong free cash flow, a solid balance sheet, and only modest leverage, though earnings growth has cooled after a strong run. Competitively, its size, broad footprint, and digital ecosystem give it advantages in a fragmented HVAC/R market, especially in the more stable replacement segment. The main things to watch are how effectively it sustains growth in a slower market, the adoption and monetization of its digital tools (including AI and WatscoOne), and its ability to keep using acquisitions and technology to deepen its lead without eroding returns.

NEWS

October 29, 2025 · 7:30 AM UTC

Watsco Reports Record Third Quarter Gross Profit, Gross Margin and Operating Cash Flow in Challenging Market Conditions

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October 16, 2025 · 7:30 AM UTC

Watsco to Host Investor Day to Showcase Transformational Technologies and New Strategies that Enhance Long-Term Growth and Profitability

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October 13, 2025 · 7:30 AM UTC

Watsco Schedules Third Quarter Earnings Call on October 29, 2025

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October 1, 2025 · 7:30 AM UTC

Watsco Declares $3.00 Quarterly Dividend

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September 11, 2025 · 7:30 AM UTC

Watsco to Present at the 13th Annual Morgan Stanley Laguna Conference on September 11, 2025 at 4:50 p.m. PDT

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