Watsco, Inc. distributes air conditioning, heating, and refrigeration equipment, along with related parts and supplies, across the United States, Canada, Latin America, and the Caribbean. Its product range includes residential ducted and ductless air conditioners, gas, electric, and oil furnaces, commercial HVAC systems, and specialized equipment. The company also supplies replacement components such as compressors, evaporator coils, and motors, plus thermostats, insulation, refrigerants, ductwork, tools, and plumbing and bathroom remodeling supplies. Watsco serves contractors and dealers in the replacement and new construction markets for residential and light commercial HVAC and refrigeration systems. Incorporated in 1956, it is headquartered in Miami, Florida.
Watsco Acquires The Granite Group in Roughly $500 Million Sales Deal
Watsco agreed on September 14 to acquire The Granite Group, a plumbing and HVAC distributor generating roughly $500 million in annual sales across seven Northeast states. Founded in 1971 and based in Concord, New Hampshire, The Granite Group serves about 11,000 customers from 82 locations and stocks roughly 29,000 SKUs from more than 450 vendors, and it will keep operating independently under CEO Bill Condron. The deal is Watsco's second of 2026, following the June acquisition of Jackson Supply Company, a $230 million Sunbelt HVAC distributor spanning 25 locations, as management continues hunting in a $74 billion North American distribution market. Watsco carries $464 million in cash and no debt, and in April it raised its annual dividend 10% to $13.20 per share, extending a streak of 52 consecutive years of payouts. The expansion comes alongside softer results: second-quarter revenue rose just 2% to $2.1 billion, but gross profit fell 4% to $579 million as gross margin slipped to 27.5% from 29.3%, operating income dropped 12% to $238 million, and earnings per share fell 12% to $4.00.
WSO · Capital · Positive Watsco agreed to acquire The Granite Group, a ~$500M-sales plumbing/HVAC distributor, expanding its footprint via M&A.
The Granite Group · Capital · Positive The Granite Group is being acquired by Watsco in a roughly $500 million sales deal and will keep operating independently.
Watsco Q2 Revenue Misses Estimates as Industrial Distributors Post Strong Quarter
Watsco reported second-quarter revenues of $2.10 billion, up 2.1% year on year but falling 1.9% short of analysts' expectations, in a quarter that saw the 24 industrial distributors stocks tracked by the report collectively beat consensus revenue estimates by 3.7%. The HVAC and refrigeration distributor also posted a significant miss of analysts' EPS estimates, and its stock is down 17.4% since reporting, trading at $303.57. Chairman and CEO Albert H. Nahmad said the quarter's performance was indicative of improving end-market stability after a busy period of regulatory transitions. Among peers, Transcat reported revenues of $92.95 million, up 21.6% year on year and 7.4% above expectations, while SiteOne posted $1.53 billion, up 4.7% but 0.7% below estimates, Alta Equipment Group reported $475.5 million, down 1.2% and 3.1% short, and Core & Main reported $2.15 billion, up 2.5% and in line with expectations. On average, shares of the group are down 5.2% since the latest earnings results.
Watsco to acquire The Granite Group in plumbing and HVAC deal
Watsco has agreed to acquire The Granite Group, a plumbing and HVAC distributor with approximately $500M in annual sales across seven Northeast states. The Granite Group serves about 11,000 customers through 82 locations, offering roughly 29,000 SKUs from more than 450 vendors. Following the deal, Granite will operate independently under its existing management team, led by CEO Bill Condron, while gaining access to Watsco's scale, capital and technology.
WSO · Capital · Positive Watsco agreed to acquire The Granite Group, an M&A deal adding ~$500M in annual sales and 82 locations.
The Granite Group · Capital · Positive The Granite Group is being acquired by Watsco and will gain access to Watsco's scale, capital and technology while operating independently.
Core & Main Q2 Earnings Preview: Revenue Growth Expected
Core & Main, a water and fire protection solutions company, will report its second-quarter earnings before the market opens on Wednesday. Analysts expect revenue to grow 2% year over year, a slowdown from the 6.6% increase recorded in the same quarter last year. The company beat revenue expectations last quarter with $1.91 billion in revenue, flat year on year, and also exceeded EBITDA estimates. However, Core & Main has missed Wall Street's revenue estimates multiple times over the past two years. In the industrial distributors segment, peers DNOW and Watsco have already reported, with DNOW beating expectations and Watsco falling short. Core & Main's stock is down 4.1% over the last month, trading at $44.32, below the average analyst price target of $59.43.
Watsco, Inc. reported second-quarter 2026 sales of US$2,104.86 million, with net income of US$163.34 million and diluted EPS from continuing operations of US$4, both lower than a year earlier despite slightly higher sales. International markets, including Canada and Latin America/Caribbean, contributed under 9% of revenue and came in below analyst expectations, underscoring the current softness of Watsco's non-U.S. operations. The company also maintained its quarterly cash dividend at US$3.30 per share following a 10% increase in April, highlighting management's focus on shareholder returns even as earnings softened. The results reinforce that near-term margin stabilization remains the key catalyst, while risks persist from tariffs, refrigerant issues, and weak international demand.
Watsco stock tumbled 15.3% through 10:45 a.m. ET Wednesday after the HVAC distributor reported second-quarter earnings that fell short of analyst expectations. Analysts had forecast earnings of $4.41 per share on more than $2.1 billion in sales, but Watsco earned $4 per share and its sales came in just below estimates. Revenue grew only 2% year over year, while gross profit declined and operating costs rose, leading to a 12% drop in earnings. The company recently acquired Jackson Supply and continues to seek additional acquisitions to spur growth in the fragmented North American HVAC market.
Watsco Inc will host a conference call at 10:00 AM ET on July 29, 2026, to discuss its second quarter 2026 earnings results. The live webcast can be accessed through the company's website at www.watsco.com. To listen by phone, dial 844-883-3908 in the US or 412-317-9254 internationally.
WSO · Capital · Neutral The article announces an earnings call, but no actual results or guidance are provided, so the impact is neutral until results are released.
Watsco reports second-quarter profit decline to $152.6 million
Watsco, Inc. announced a decline in second-quarter profit. The company's earnings totaled $152.603 million, or $4.00 per share, compared with $171.454 million, or $4.52 per share, in the same period last year. Revenue for the quarter rose 2.0% to $2.104 billion from $2.062 billion a year earlier.
Watsco is set to report its second-quarter earnings this Wednesday before the bell. The market expects revenue to grow 4% year on year, reversing a 3.6% decline in the same quarter last year. Analysts have largely maintained their estimates over the past 30 days, though the company has missed Wall Street revenue expectations multiple times in the last two years. Watsco shares are down 11.3% over the past month, heading into earnings with an average analyst price target of $428.70 compared to the current share price of $364.20.
Watsco Sets July 29 Earnings Call Amid 12.2% Undervaluation Narrative
Watsco has scheduled a conference call for July 29, 2026, to discuss its second quarter results. The HVAC distributor's stock recently closed at $371.91, down 13.56% over the past 90 days but with a total shareholder return of 18.36% over the past year. A narrative fair value estimate of $423.55 suggests the shares are 12.2% undervalued, supported by a strong balance sheet with $430 million in cash, no debt, and over $3 billion in equity. However, the current price-to-earnings ratio of 31x exceeds the US Trade Distributors industry average of 25.6x and the peer average of 19.6x, indicating higher valuation risk if growth assumptions are questioned.
WSO · Capital · Neutral Article discusses earnings call, valuation narrative, and balance sheet, but no concrete results or catalyst; mixed signals from undervaluation claim vs high P/E.
StockStory flags Watsco, Illumina, and First Horizon as mid-cap stocks to avoid
StockStory has identified three mid-cap stocks that raise concerns for investors. Watsco, with a market cap of $15.43 billion, saw flat sales over the last two years and a 3.7% annual decline in earnings per share, partly due to shareholder dilution. Illumina, valued at $25.15 billion, also experienced flat sales over the same period and posted a return on capital of just 0.7%, signaling difficulty in finding profitable growth. First Horizon, a $11.86 billion bank, reported slower net interest income growth than peers and earnings per share growth of only 5.7% annually over five years, with tangible book value per share growth expected to slow to 5.3%.
Watsco's Board of Directors has declared a regular quarterly cash dividend of $3.30 per share on its Common and Class B common stock. The dividend is payable on July 31, 2026 to shareholders of record as of July 16, 2026. Watsco has paid dividends for 52 consecutive years and plans to share cash flow while maintaining a conservative balance sheet. The company is the largest distributor in the North American HVAC/R market and serves approximately 74,000 contractors digitally.
Watsco Stock Up 22% YTD, Yields Over 3% as Dividend Raised 10%
Watsco shares have gained 22% year-to-date in 2026, outperforming the S&P 500's 8% rise, while offering a forward dividend yield above 3%. The Miami-based HVAC distributor's board approved a 10% quarterly dividend increase to $3.30 per share in April, lifting the annual rate to $13.20 and a forward yield of 3.29%. March quarter revenue of $1.53 billion beat estimates by 3.4%, and adjusted earnings per share of $1.87 topped consensus by 10.7%, supported by an adjusted EBITDA margin of 8.4%. Watsco also closed the acquisition of Jackson Supply Company, a distributor with $230 million in 2025 sales and 25 locations across Sun Belt states, strengthening its footprint in high-growth markets. Analysts maintain a consensus Hold rating with an average 12-month price target of $420.80, implying about 2% upside from current levels near $411.
StockStory Highlights Apple and Analog Devices as Opportunities, Warns on Watsco
StockStory identifies Apple and Analog Devices as stocks poised to prove Wall Street wrong, while flagging Watsco as facing legitimate challenges. Apple, trading at $294.65 per share with a forward P/E of 32.6x, benefits from enduring brand strength and elite operating margins despite sluggish recent growth. Analog Devices, at $410.08 per share and a 32.2x forward P/E, stands out for its 15.5% annual revenue growth over five years and best-in-class 62% gross margin. Watsco, priced at $387.69 with a 31.2x forward P/E, is weighed down by stagnating sales, 3.7% annual EPS declines from share issuance, and diminishing returns on capital.
Watsco Acquires Jackson Supply Company, Adding 25 Sunbelt Locations
Watsco Inc. has completed its acquisition of Jackson Supply Company, a major independent HVAC distributor in the Sunbelt. Jackson Supply generated $230 million in sales in 2025 and operates 25 locations across Texas, Louisiana, Tennessee, Alabama, Mississippi, Oklahoma, and Arizona, serving approximately 5,000 contractor customers. The acquired business will retain its name, vendor relationships, brand identity, and existing leadership team under Jim Durrett. Watsco's Chairman and CEO Albert H. Nahmad highlighted Jackson Supply's five decades of entrepreneurial success, and the deal supports Watsco's goal of expanding its share of the estimated $74 billion North American HVAC/R distribution market.
United States