Watsco (NYSE:WSO) Shares Gap Down After Earnings Miss

Shares of Watsco, Inc. (NYSE:WSO) gapped down prior to trading on Wednesday following a weaker than expected earnings announcement. The stock had previously closed at $484.77, but opened at $454.91. Watsco shares last traded at $469.99, with a volume of 38,082 shares traded.

The construction company reported $4.22 earnings per share for the quarter, missing the consensus estimate of $4.73 by ($0.51). Watsco had a net margin of 7.02% and a return on equity of 18.55%. The firm had revenue of $2.16 billion during the quarter, compared to the consensus estimate of $2.24 billion. During the same quarter in the previous year, the firm earned $4.35 earnings per share. The business’s revenue was up 1.6% compared to the same quarter last year.

Watsco Dividend Announcement

The firm also recently disclosed a quarterly dividend, which will be paid on Thursday, October 31st. Investors of record on Wednesday, October 16th will be issued a dividend of $2.70 per share. This represents a $10.80 annualized dividend and a yield of 2.26%. The ex-dividend date of this dividend is Wednesday, October 16th. Watsco’s payout ratio is 83.08%.

Analyst Ratings Changes

Several analysts have issued reports on the company. Robert W. Baird dropped their target price on Watsco from $550.00 to $540.00 and set an “outperform” rating on the stock in a research report on Thursday. JPMorgan Chase & Co. boosted their target price on shares of Watsco from $420.00 to $425.00 and gave the stock a “neutral” rating in a report on Wednesday, July 31st.

Institutional Trading of Watsco

Several hedge funds and other institutional investors have recently made changes to their positions in WSO. Hunter Associates Investment Management LLC lifted its position in Watsco by 1.8% during the 3rd quarter. Hunter Associates Investment Management LLC now owns 6,555 shares of the construction company’s stock worth $3,223,000 after acquiring an additional 115 shares during the period. Autumn Glory Partners LLC boosted its stake in shares of Watsco by 149.8% during the 3rd quarter. Autumn Glory Partners LLC now owns 1,369 shares of the construction company’s stock worth $679,000 after acquiring an additional 821 shares in the last quarter. Semanteon Capital Management LP grew its holdings in Watsco by 202.4% in the third quarter. Semanteon Capital Management LP now owns 2,313 shares of the construction company’s stock valued at $1,138,000 after purchasing an additional 1,548 shares during the period. State of Alaska Department of Revenue increased its holdings in Watsco by 16.1% in the 3rd quarter. State of Alaska Department of Revenue now owns 4,037 shares of the construction company’s stock worth $1,985,000 after acquiring an additional 560 shares in the last quarter. Finally, Hamlin Capital Management LLC raised its position in shares of Watsco by 7.4% during the 3rd quarter. Hamlin Capital Management LLC now owns 314,543 shares of the construction company’s stock worth $154,717,000 after purchasing an additional 21,649 shares during the last quarter. Hedge funds and other institutional investors own 89.71% of the company’s stock.

Watsco Stock Performance

The company has a quick ratio of 1.55, a current ratio of 3.21 and a debt-to-equity ratio of 0.01. The firm has a 50-day moving average price of $481.96 and a two-hundred day moving average price of $473.32. The firm has a market cap of $19.27 billion, a PE ratio of 36.78 and a beta of 0.88.

About Watsco

Watsco, Inc, together with its subsidiaries, engages in the distribution of air conditioning, heating, refrigeration equipment, and related parts and supplies in the United States and internationally. The company distributes equipment, including residential ducted and ductless air conditioners, such as gas, electric, and oil furnaces; commercial air conditioning and heating equipment systems; and other specialized equipment.