Watsco (WSO) To Report Earnings Tomorrow: Here Is What To Expect

Equipment distributor Watsco (NYSE:WSO) will be announcing earnings results tomorrow before market hours. Here’s what to look for.

Watsco missed analysts’ revenue expectations by 2.1% last quarter, reporting revenues of $2.14 billion, up 6.8% year on year. It was a disappointing quarter for the company, with a miss of analysts’ same-store sales and earnings estimates.

Is Watsco a buy or sell going into earnings? Read our full analysis here, it’s free.

This quarter, analysts are expecting Watsco’s revenue to grow 5.4% year on year to $2.24 billion, in line with the 4.5% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $4.76 per share.

The majority of analysts covering the company have reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings.

Looking at Watsco’s peers in the industrial distributors segment, some have already reported their Q3 results, giving us a hint as to what we can expect. Richardson Electronics delivered year-on-year revenue growth of 2.2%, beating analysts’ expectations by 8.7%, and Fastenal reported revenues up 3.5%, in line with consensus estimates. Richardson Electronics traded down 2.5% following the results while Fastenal was up 9.6%.

Read our full analysis of Richardson Electronics’s results here and Fastenal’s results here.

There has been positive sentiment among investors in the industrial distributors segment, with share prices up 2.3% on average over the last month. Watsco’s stock price was unchanged during the same time and is heading into earnings with an average analyst price target of $470.45 (compared to the current share price of $492.22).

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