What is Zacks Research’s Forecast for Watsco Q3 Earnings?

Watsco, Inc. (NYSE:WSO) – Analysts at Zacks Research decreased their Q3 2026 EPS estimates for Watsco in a research note issued to investors on Wednesday, August 19th. Zacks Research analyst Team now anticipates that the construction company will earn $4.21 per share for the quarter, down from their previous forecast of $4.29. The consensus estimate for Watsco’s current full-year earnings is $12.43 per share. Zacks Research also issued estimates for Watsco’s Q4 2026 earnings at $2.13 EPS, FY2026 earnings at $12.21 EPS, Q1 2027 earnings at $1.93 EPS, Q2 2027 earnings at $4.61 EPS, Q3 2027 earnings at $4.65 EPS, Q4 2027 earnings at $2.33 EPS, FY2027 earnings at $13.53 EPS, Q1 2028 earnings at $2.05 EPS, Q2 2028 earnings at $5.06 EPS and FY2028 earnings at $15.26 EPS.

Several other research firms have also commented on WSO. DA Davidson reduced their price target on Watsco from $385.00 to $330.00 and set a “neutral” rating on the stock in a research report on Thursday, July 30th. Stephens reissued an “overweight” rating and set a $485.00 target price on shares of Watsco in a research report on Monday. Morgan Stanley upped their target price on shares of Watsco from $370.00 to $405.00 and gave the company an “equal weight” rating in a research note on Friday, July 10th. Weiss Ratings reaffirmed a “hold (c)” rating on shares of Watsco in a report on Friday, June 26th. Finally, Robert W. Baird set a $400.00 price target on shares of Watsco in a research note on Thursday, July 30th. Two analysts have rated the stock with a Buy rating and nine have issued a Hold rating to the stock. Based on data from MarketBeat.com, the company presently has a consensus rating of “Hold” and an average price target of $395.50.

Watsco Price Performance

Shares of WSO opened at $319.91 on Thursday. The stock’s 50-day moving average is $365.93 and its two-hundred day moving average is $386.76. The stock has a market cap of $13.20 billion, a PE ratio of 27.75 and a beta of 1.05. Watsco has a 12 month low of $300.66 and a 12 month high of $459.00.

Watsco (NYSE:WSO) last announced its quarterly earnings results on Wednesday, July 29th. The construction company reported $4.00 earnings per share for the quarter, missing analysts’ consensus estimates of $4.41 by ($0.41). Watsco had a return on equity of 14.40% and a net margin of 6.53%.The business had revenue of $2.10 billion for the quarter, compared to analysts’ expectations of $2.14 billion. During the same period last year, the company posted $4.52 earnings per share. The firm’s revenue for the quarter was up 2.1% on a year-over-year basis.

Institutional Inflows and Outflows

A number of institutional investors have recently added to or reduced their stakes in the stock. Torren Management LLC bought a new stake in Watsco in the fourth quarter valued at $26,000. Bayban bought a new stake in Watsco in the 4th quarter valued at about $29,000. Bamco Inc. NY acquired a new position in Watsco during the 4th quarter valued at about $35,000. Laurel Wealth Advisors LLC acquired a new position in Watsco during the 4th quarter valued at about $37,000. Finally, Quarry LP bought a new position in Watsco in the 4th quarter worth about $37,000. 89.71% of the stock is currently owned by institutional investors.

Watsco Dividend Announcement

The firm also recently announced a quarterly dividend, which was paid on Friday, July 31st. Shareholders of record on Thursday, July 16th were issued a $3.30 dividend. The ex-dividend date of this dividend was Thursday, July 16th. This represents a $13.20 dividend on an annualized basis and a yield of 4.1%. Watsco’s dividend payout ratio (DPR) is currently 114.48%.

Key Stories Impacting Watsco

Here are the key news stories impacting Watsco this week:

• Positive Sentiment: Zacks Research raised its FY2028 EPS forecast to $15.26 from $14.93, suggesting analysts still see meaningful long-term earnings growth. The firm also increased its Q1 2027 estimate slightly to $1.93 from $1.92 and its Q1 2028 estimate to $2.05 from $1.93. Watsco analyst estimates
• Positive Sentiment: Stephens reaffirmed an Overweight rating on Watsco, maintaining a constructive view of the company’s shares. Stephens Reaffirms Overweight Rating for Watsco
• Neutral Sentiment: Zacks’ FY2028 EPS forecast of $15.26 remains above its FY2026 estimate of $12.21 and FY2027 estimate of $13.53, indicating a continued longer-term growth outlook. However, the current-year consensus estimate is $12.43, leaving FY2026 expectations slightly below consensus.
• Negative Sentiment: Zacks Research cut its FY2026 EPS forecast to $12.21 from $12.56 and reduced FY2027 EPS to $13.53 from $13.70. It also lowered estimates for Q3 2026 to $4.21 from $4.29, Q4 2026 to $2.13 from $2.15, Q2 2027 to $4.61 from $4.75, Q3 2027 to $4.65 from $4.69, Q4 2027 to $2.33 from $2.34, and Q2 2028 to $5.06 from $5.24. The broad pattern of downward revisions signals softer near- and medium-term earnings expectations.

About Watsco

Watsco, Inc is the largest distributor of heating, ventilation, air conditioning and refrigeration (HVAC/R) equipment, parts and supplies in the United States. Headquartered in Miami, Florida, the company operates a network of more than 600 branches across the continental U.S., Canada and Puerto Rico. Watsco serves residential and commercial contractors by providing essential components for climate control systems, including air conditioners, furnaces, heat pumps, coils, refrigerants, controls and electrical and piping supplies.

Founded in 1947, Watsco has grown from a single regional distributor into an industry leader through a combination of organic expansion, acquisitions and strategic partnerships with original equipment manufacturers such as Carrier, Trane, Goodman and Lennox.