Watsco (WSO) Upgraded to “Buy” at Zacks Investment Research

Watsco (NYSE:WSO) was upgraded by Zacks Investment Research from a “hold” rating to a “buy” rating in a research report issued to clients and investors on Monday. The brokerage presently has a $197.00 price target on the construction company’s stock. Zacks Investment Research‘s target price indicates a potential upside of 12.01% from the stock’s previous close.

According to Zacks, “Watsco will gain from its industry-leading technologies and estimates the e-commerce sales to touch $1 billion this year. Watsco continues to transform its business into the digital age by investing in scalable platforms for mobile apps, e-commerce, business intelligence and supply-chain optimization. Its technology evolution continues to make progress. Further, its focus on strategic acquisitions, cost-cutting initiatives and growth potential in the replacement market will drive growth.”

WSO has been the subject of several other reports. KeyCorp reaffirmed a “buy” rating on shares of Watsco in a research report on Friday, November 17th. Morgan Stanley upped their target price on Watsco from $141.00 to $151.00 and gave the stock an “underweight” rating in a report on Monday, September 25th. One investment analyst has rated the stock with a sell rating, two have assigned a hold rating and five have given a buy rating to the company. The stock has an average rating of “Buy” and an average price target of $166.00.

Watsco (NYSE:WSO) traded up $2.19 during mid-day trading on Monday, hitting $175.87. The stock had a trading volume of 98,700 shares, compared to its average volume of 166,369. The company has a quick ratio of 1.42, a current ratio of 3.13 and a debt-to-equity ratio of 0.21. The firm has a market capitalization of $6,285.77, a PE ratio of 32.51 and a beta of 0.83. Watsco has a 52 week low of $134.08 and a 52 week high of $176.57.

Watsco (NYSE:WSO) last posted its quarterly earnings data on Wednesday, October 25th. The construction company reported $1.82 earnings per share for the quarter, missing the consensus estimate of $1.95 by ($0.13). The firm had revenue of $1.23 billion for the quarter, compared to analyst estimates of $1.26 billion. Watsco had a return on equity of 15.00% and a net margin of 4.46%. The firm’s quarterly revenue was down .9% on a year-over-year basis. During the same period in the prior year, the company earned $1.78 earnings per share. sell-side analysts anticipate that Watsco will post 5.58 earnings per share for the current fiscal year.

In related news, SVP Barry S. Logan sold 3,246 shares of the company’s stock in a transaction dated Wednesday, November 22nd. The stock was sold at an average price of $164.30, for a total transaction of $533,317.80. Following the sale, the senior vice president now owns 15,800 shares in the company, valued at $2,595,940. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is accessible through this hyperlink. Corporate insiders own 13.93% of the company’s stock.

Institutional investors and hedge funds have recently added to or reduced their stakes in the stock. LaFleur & Godfrey LLC raised its holdings in Watsco by 4.6% during the second quarter. LaFleur & Godfrey LLC now owns 25,570 shares of the construction company’s stock worth $3,597,000 after acquiring an additional 1,120 shares in the last quarter. Anchor Capital Advisors LLC raised its stake in Watsco by 0.8% in the second quarter. Anchor Capital Advisors LLC now owns 5,035 shares of the construction company’s stock valued at $708,000 after buying an additional 40 shares during the period. Neuberger Berman Group LLC raised its stake in Watsco by 16.3% in the fourth quarter. Neuberger Berman Group LLC now owns 1,067,452 shares of the construction company’s stock valued at $125,031,000 after buying an additional 149,964 shares during the period. First Trust Advisors LP raised its stake in Watsco by 3.8% in the fourth quarter. First Trust Advisors LP now owns 75,134 shares of the construction company’s stock valued at $8,800,000 after buying an additional 2,765 shares during the period. Finally, Janus Capital Management bought a new stake in Watsco in the third quarter valued at approximately $6,718,000. Institutional investors and hedge funds own 82.45% of the company’s stock.

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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.

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