Financial Performance - For the quarter ended June 2024, Watsco reported revenue of $2.14 billion, reflecting a year-over-year increase of 6.8% [1] - The earnings per share (EPS) for the quarter was $4.49, slightly up from $4.42 in the same quarter last year [1] - The reported revenue was a surprise of -0.16% compared to the Zacks Consensus Estimate of $2.14 billion, while the EPS fell short of the consensus estimate of $4.75 by -5.47% [1] Sales Trends - Sales trends for HVAC equipment accounted for 71% of total sales, exceeding the average estimate of 36.5% based on two analysts [3] - Sales trends for commercial refrigeration products represented 4% of total sales, compared to the average estimate of 3.3% [3] - Other HVAC products made up 25% of total sales, significantly higher than the average estimate of 14% [4] Stock Performance - Watsco's shares have returned -2% over the past month, while the Zacks S&P 500 composite experienced a -0.4% change [4] - The stock currently holds a Zacks Rank 3 (Hold), suggesting it may perform in line with the broader market in the near term [4]

Financial Performance - Watsco, Inc. reported second-quarter earnings per share of $4.49, missing the expected $4.67 [1] - Sales totaled $2.14 billion, falling short of the analyst consensus of $2.19 billion [1] - Revenue increased by 7% year over year, with a 4% increase on a same-store basis [1] - Gross profit rose by 3% to $580 million, achieving a gross margin of 27.1% [1] Market Reaction - Following the earnings announcement, Watsco shares gained 1.4%, trading at $487.65 [2] - Analysts adjusted their price targets for Watsco after the earnings report [2] Analyst Ratings - Baird analyst David Manthey maintained an Outperform rating on Watsco, raising the price target from $460 to $522 [3] - JP Morgan analyst Stephen Tusa maintained a Neutral rating, increasing the price target from $420 to $425 [3]

Core Viewpoint - Watsco reported strong sales growth and improving cash flow, but results fell short of Wall Street expectations, leading to a decline in share price [3][4][8] Financial Performance - The company earned $4.49 per share on revenue of $2.14 billion, reflecting a 7% year-over-year sales growth [4] - The HVAC equipment segment, which constitutes 71% of total sales, experienced an 8% growth [4] - Operating cash flow improved by $100 million, reaching $58 million in the quarter [4] - Wall Street had anticipated earnings of $4.68 per share and sales of $2.2 billion, indicating a shortfall in expectations [5] Market Reaction - Following the earnings release, Watsco's shares fell approximately 5% [8] - The stock had previously increased over 20% for the year prior to the earnings announcement, suggesting it may have been overvalued [6] Management Insights - Management indicated that margin fluctuations are expected as manufacturers adjust pricing and inventories are replenished, but they foresee a return to normal business operations [7] - Long-term investors have historically seen market-beating returns from the company, and there are no indications from the earnings report that Watsco will not continue to perform well in the future [7]

Watsco, Inc. (NYSE:WSO) Q2 2024 Earnings Conference Call July 30, 2024 10:00 AM ET Company Participants Al Nahmad - Chairman and CEO Paul Johnston – EVP Barry Logan – EVP A.J. Nahmad – President Rick Gomez - VP Conference Call Participants Jeffrey Hammond - KeyBanc Capital Markets Inc. Tommy Moll - Stephens Inc. Ryan Merkel - William Blair Brett Linzey - Mizuho Patrick Baumann – J.P. Morgan David Manthey – Baird Nigel Coe - Wolfe Research Operator Good day, and welcome to the Watsco Second Quarter 2024 Earn ...

Watsco (WSO) came out with quarterly earnings of $4.49 per share, missing the Zacks Consensus Estimate of $4.75 per share. This compares to earnings of $4.42 per share a year ago. These figures are adjusted for nonrecurring items. Watsco, which belongs to the Zacks Building Products - Air Conditioner and Heating industry, posted revenues of $2.14 billion for the quarter ended June 2024, missing the Zacks Consensus Estimate by 0.16%. This compares to year-ago revenues of $2 billion. The company has topped co ...

Continued Customer Adoption of Industry-Leading Technologies Helps Drive Share Gains; Debt-Free Balance Sheet Supports Long-Term Investment and Growth A cornerstone of Watsco's growth strategy is the acquisition of long-standing, family-owned businesses. Watsco has completed 69 acquisitions, achieving industry-leading scale and preserving many wonderful business legacies into future generations. Over the last five years, Watsco has acquired eight businesses that today generate approximately $1 billion in an ...

Continued Customer Adoption of Industry-Leading Technologies Helps Drive Share Gains; Debt-Free Balance Sheet Supports Long-Term Investment and Growth Since entering distribution in 1989, Watsco's operating profits have grown at a compounded annual growth rate (CAGR) of 18% and dividends have grown at a 21% CAGR. These long-term growth rates are indicative of strong and consistent performance across most macroeconomic and industry cycles. Second Quarter Results 8% increase in HVAC equipment (71% of sales) 1 ...

Continued Customer Adoption of Industry-Leading Technologies Helps Drive Share Gains; Debt-Free Balance Sheet Supports Long-Term Investment and Growth MIAMI, July 30, 2024 (GLOBE NEWSWIRE) -- Watsco, Inc. (NYSE: WSO) announced its operating results for the second quarter and six-month period ended June 30, 2024. Commentary was also provided on business trends, growth opportunities, technology innovation and its financial position. Watsco is the largest distributor in the highly fragmented $64 billion North ...

While the sustainability of the immediate price change and future earnings expectations will mostly depend on management's discussion of business conditions on the earnings call, it's worth handicapping the probability of a positive EPS surprise. Estimate Revisions Trend The stock might move higher if these key numbers top expectations in the upcoming earnings report, which is expected to be released on July 30. On the other hand, if they miss, the stock may move lower. This heating and cooling company is e ...

Company Overview - Watsco, Inc. operates the largest distribution network for heating, air conditioning, and refrigeration (HVAC/R) products across the United States, Canada, Mexico, and Puerto Rico, with additional export operations to Latin America and the Caribbean [5] - The company has 691 locations that serve over 375,000 owner-operators, technicians, and installers annually, providing information, technical support, and product sales [5] Market Focus - Watsco focuses on the replacement market, which is growing due to the aging of installed HVAC systems, the introduction of more energy-efficient models, and the essential nature of HVAC products in residential and commercial settings [6] - Approximately 102 million HVAC systems in the U.S. are over 10 years old and operate below current efficiency standards, indicating a significant opportunity for replacement [6] Environmental Impact - Watsco plays a crucial role in addressing climate change by contributing to the reduction of CO2e emissions through the sale of higher-efficiency HVAC systems [7] - HVAC systems account for about half of U.S. household energy consumption, making the replacement of older systems a vital strategy for reducing electricity use and carbon footprints [7] - From January 1, 2020, to June 30, 2024, Watsco is estimated to have averted 20.9 million metric tons of CO2e emissions, equivalent to removing 5 million gas-powered vehicles from the road annually [8]