
Watsco (WSO) Stock Forecast & Price Target
Watsco (WSO) Analyst Ratings
Bulls say
Watsco has demonstrated robust pricing power and strong gross margins, with significant price increases anticipated from major OEMs contributing to a positive outlook for 2024 and 2025. The company has also reported inventory profit growth in 2023, which complements the expected unit and price/mix momentum moving forward. Given the continued improvement in volumetric and pricing conditions, Watsco's strategic positioning within the HVACR sector bodes well for maintaining and enhancing its gross margin targets.
Bears say
Watsco has reported a year-over-year decline in gross margin of 160 basis points, primarily attributed to the elimination of inventory profits and a decrease in the product mix, which negatively impacted revenues during a seasonally minor quarter. Additionally, the miss in earnings per share compared to expectations can be linked to lower equipment volumes and anticipated declines in sales based on industry metrics from AHRI and HARDI. The outlook is further clouded by concerns over potential gross margin deterioration, lagging product transitions, and underperformance in SG&A productivity, suggesting ongoing challenges for the company's financial performance.
This aggregate rating is based on analysts' research of Watsco and is not a guaranteed prediction by Public.com or investment advice.
Watsco (WSO) Analyst Forecast & Price Prediction
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