What Happened?
Shares of equipment distributor Watsco (NYSE: WSO) jumped 8.3% in the morning session after the company reported strong fourth-quarter 2024 results, which blew past analysts' sales, operating profits, and earnings estimates. Sales rose 9.4% y/y, fueled by double-digit growth in residential HVAC equipment. Zooming out, we think this was a good quarter with some key areas of upside.
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What The Market Is Telling Us
Watsco’s shares are not very volatile and have only had 2 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.
Watsco is up 12.6% since the beginning of the year, and at $527.68 per share, it is trading close to its 52-week high of $568.78 from November 2024. Investors who bought $1,000 worth of Watsco’s shares 5 years ago would now be looking at an investment worth $3,094.
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