Watsco (NYSE: WSO.B) and Watsco (NYSE:WSO) are both mid-cap industrials companies, but which is the better stock? We will compare the two businesses based on the strength of their earnings, valuation, profitabiliy, analyst recommendations, institutional ownership, risk and dividends.

Analyst Ratings

This is a breakdown of recent recommendations for Watsco and Watsco, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Watsco 0 0 0 0 N/A
Watsco 1 2 3 0 2.33

Watsco has a consensus price target of $161.75, indicating a potential upside of 6.56%.

Profitability

This table compares Watsco and Watsco’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Watsco 7.12% 27.14% 17.82%
Watsco 4.29% 14.52% 9.25%

Institutional & Insider Ownership

0.1% of Watsco shares are owned by institutional investors. Comparatively, 81.2% of Watsco shares are owned by institutional investors. 13.8% of Watsco shares are owned by company insiders. Comparatively, 13.9% of Watsco shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Dividends

Watsco pays an annual dividend of $5.00 per share. Watsco pays an annual dividend of $5.00 per share and has a dividend yield of 3.3%. Watsco pays out 93.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Watsco pays out 93.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Watsco has raised its dividend for 3 consecutive years.

Earnings and Valuation

This table compares Watsco and Watsco’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Watsco N/A N/A N/A $5.37 N/A
Watsco $4.30 billion 1.15 $376.63 million $5.37 28.27

Watsco has higher revenue and earnings than Watsco. Watsco is trading at a lower price-to-earnings ratio than Watsco, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

Watsco has a beta of 0.79, meaning that its stock price is 21% less volatile than the S&P 500. Comparatively, Watsco has a beta of 0.83, meaning that its stock price is 17% less volatile than the S&P 500.

Summary

Watsco beats Watsco on 6 of the 11 factors compared between the two stocks.

About Watsco

Watsco, Inc. is a distributor of air conditioning, heating and refrigeration equipment, and related parts and supplies (HVAC/R) in the HVAC/R distribution industry in North America. As of December 31, 2016, the Company sold a range of non-equipment products, representing more than 300,000 stock keeping units, including parts, ductwork, air movement products, insulation, tools, installation supplies, thermostats and air quality products. It distributes products consisting of equipment, including residential ducted and ductless air conditioners ranging from 1 to 5 tons, gas, electric and oil furnaces ranging from 50,000 to 150,000 British Thermal Units, commercial air conditioning and heating equipment and systems ranging from 1.5 to 25 tons and other specialized equipment; parts, including replacement compressors and motors, and supplies, including ductwork, grills, registers, sheet metal, adhesives and other ancillary supplies. It also sells products to the refrigeration market.

About Watsco

Watsco, Inc. is a distributor of air conditioning, heating and refrigeration equipment, and related parts and supplies (HVAC/R) in the HVAC/R distribution industry in North America. As of December 31, 2016, the Company sold a range of non-equipment products, representing more than 300,000 stock keeping units, including parts, ductwork, air movement products, insulation, tools, installation supplies, thermostats and air quality products. It distributes products consisting of equipment, including residential ducted and ductless air conditioners ranging from 1 to 5 tons, gas, electric and oil furnaces ranging from 50,000 to 150,000 British Thermal Units, commercial air conditioning and heating equipment and systems ranging from 1.5 to 25 tons and other specialized equipment; parts, including replacement compressors and motors, and supplies, including ductwork, grills, registers, sheet metal, adhesives and other ancillary supplies. It also sells products to the refrigeration market.

Receive News & Ratings for Watsco Inc Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Watsco Inc and related companies with MarketBeat.com's FREE daily email newsletter.