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Watsco, Inc. and its subsidiaries (collectively, Watsco, the Company , or we, us, or our ) was incorporated in Florida in 1956 and is the largest distributor of air conditioning, heating and refrigeration equipment and related parts and supplies ( HVAC/R ) in the HVAC/R distribution industry in North America. States, Canada, Mexico and Puerto Rico with additional market coverage on an export ba…
$375.17
$3.19 (-0.84%)
Price from 12 days ago
Operating margin is thin at 9.95%. Limited cushion if revenue slows or costs rise, not the profile of a wide-moat business.
Revenue declined 5.0% YoY. The question is whether this is cyclical or a structural shift.
At 31x earnings, the current multiple leaves limited room for execution misses or growth deceleration. Free cash flow declined 28% versus the prior year, cash generation momentum has weakened.
30.8x earnings, 20.5x FCF. Not cheap, the quality is already reflected in the price. Upside from here requires either margin expansion or growth re-acceleration, not just continuation.
Based on TTM earnings · Diluted shares
Profitability & Returns
Revenue (TTM)
$7.24B
▼ -5.0% YoY
Net Income (TTM)
$482M
▼ -7.3% YoY
Op. Margin
9.92%
▼ -0.3pp YoY
ROIC
16.80%
▼ -3.1pp YoY
Cash Flow & Balance Sheet
FCF (TTM)
$694M
▼ -28.0% YoY
Op. Cash Flow (TTM)
$728M
▼ -26.3% YoY
Net Debt
-$96M
Net Cash Position
Cash & Equiv.
$593M
5Y CAGR: +7.4%
5Y CAGR: +0.7%
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