ScoreWhy is Watsco, Inc. ?
1
High Management Efficiency with a high ROCE of 33.49%
2
Company has a low Debt to Equity ratio (avg) at times
3
Healthy long term growth as Net Sales has grown by an annual rate of 9.22% and Operating profit at 16.80%
4
Flat results in Jun 25
- ROCE(HY) Lowest at 18.38%
- INVENTORY TURNOVER RATIO(HY) Lowest at 3.11 times
5
With ROCE of 31.28%, it has a very expensive valuation with a 8.38 Enterprise value to Capital Employed
- The stock is trading at a discount compared to its peers' average historical valuations
- Over the past year, while the stock has generated a return of -35.26%, its profits have risen by 2%
6
Below par performance in long term as well as near term
- Along with generating -35.26% returns in the last 1 year, the stock has also underperformed S&P 500 in the last 3 years, 1 year and 3 months
Real-Time Research ReportHow much should you hold?
- Overall Portfolio exposure to Watsco, Inc. should be less than 10%
- Overall Portfolio exposure to Building Products should be less than 30%
(If sector exposure > 30%, please use optimiser tool to see which are the best stocks to hold in Building Products)
When to exit? - We will constantly monitor the company and suggest at the appropriate time to exit from the stock
Is Watsco, Inc. for you?
Medium Risk, Low Return
Absolute
Risk Adjusted
Volatility
Watsco, Inc.
-35.26%
-0.76
32.91%
S&P 500
13.22%
0.65
20.20%
Quality
Management Risk
Growth
Capital StructureQuality key factors
Factor
Value
Sales Growth (5y)
9.22%
EBIT Growth (5y)
16.80%
EBIT to Interest (avg)
100.00
Debt to EBITDA (avg)
0.11
Net Debt to Equity (avg)
-0.12
Sales to Capital Employed (avg)
2.86
Tax Ratio
20.88%
Dividend Payout Ratio
81.20%
Pledged Shares
0
Institutional Holding
100.00%
ROCE (avg)
33.49%
ROE (avg)
26.16%
ValuationValuation Key Factors 
Factor
Value
P/E Ratio
34
Industry P/E
Price to Book Value
7.49
EV to EBIT
26.78
EV to EBITDA
25.34
EV to Capital Employed
8.38
EV to Sales
2.59
PEG Ratio
NA
Dividend Yield
2.17%
ROCE (Latest)
31.28%
ROE (Latest)
21.95%
TechnicalsTechnical key factors
Indicator
Weekly
Monthly
MACD
Bearish
Mildly Bearish
RSI
Bullish
No Signal
Bollinger Bands
Mildly Bearish
Bearish
Moving Averages
Bearish (Daily)
KST
Bearish
Mildly Bearish
Dow Theory
No Trend
Mildly Bearish
OBV
No Trend
Mildly Bullish
Technical Indicator Scale: Bearish, Mildly Bearish, Sideways, Mildly Bullish, Bullish Turned 
Financial Trend11What is working for the Company
DIVIDEND PER SHARE(HY)
Highest at USD 7.44
DIVIDEND PAYOUT RATIO(Y)
Highest at 66.31%
RAW MATERIAL COST(Y)
Fallen by -8.19% (YoY
OPERATING PROFIT(Q)
Highest at USD 275.99 MM
OPERATING PROFIT MARGIN(Q)
Highest at 13.38 %
PRE-TAX PROFIT(Q)
Highest at USD 274.79 MM
NET PROFIT(Q)
Highest at USD 171.91 MM
EPS(Q)
Highest at USD 4.52
-3What is not working for the Company
ROCE(HY)
Lowest at 18.38%
INVENTORY TURNOVER RATIO(HY)
Lowest at 3.11 times
Here's what is working for Watsco, Inc.
Dividend per share
Highest at USD 7.44 and Grown
In each year in the last five yearsMOJO Watch
Company is distributing higher dividend from profits generated
DPS (USD)
Operating Profit
Highest at USD 275.99 MM
in the last five periodsMOJO Watch
Near term Operating Profit trend is positive
Operating Profit (USD MM)
Operating Profit Margin
Highest at 13.38 %
in the last five periodsMOJO Watch
Company's profit margin has improved
Operating Profit to Sales
Pre-Tax Profit
Highest at USD 274.79 MM
in the last five periodsMOJO Watch
Near term Pre-Tax Profit trend is positive
Pre-Tax Profit (USD MM)
Pre-Tax Profit
At USD 274.79 MM has Grown at 39.48%
over average net sales of the previous four periods of USD 197 MMMOJO Watch
Near term Pre-Tax Profit trend is positive
Pre-Tax Profit (USD MM)
Net Profit
Highest at USD 171.91 MM
in the last five periodsMOJO Watch
Near term Net Profit trend is positive
Net Profit (USD MM)
Net Profit
At USD 171.91 MM has Grown at 40.79%
over average net sales of the previous four periods of USD 122.11 MMMOJO Watch
Near term Net Profit trend is positive
Net Profit (USD MM)
EPS
Highest at USD 4.52
in the last five periodsMOJO Watch
Increasing profitability; company has created higher earnings for shareholders
EPS (USD)
Dividend Payout Ratio
Highest at 66.31%
in the last five yearsMOJO Watch
Company is distributing higher proportion of profits generated as dividend
DPR (%)
Raw Material Cost
Fallen by -8.19% (YoY)
MOJO Watch
The company's ability to pass on the cost of raw materials to customers has improved; this may lead to a rise in profit margin
Raw Material Cost as a percentage of Sales
Depreciation
Highest at USD 10.91 MM
in the last five periodsMOJO Watch
The expenditure on assets done by the company may have gone into operation
Depreciation (USD MM)
Here's what is not working for Watsco, Inc.
Inventory Turnover Ratio
Lowest at 3.11 times
in the last five Semi-Annual periodsMOJO Watch
Company's pace of selling inventory has slowed
Inventory Turnover Ratio
InfinHub Market Technologies FZ-LLC, Building-2, Unit 112, Dubai Internet City, Dubai, United Arab Emirates
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