On September 24, 2023, Naples Global Advisors LLC revealed that it has reduced its stake in Watsco, Inc. (NYSE:WSO) by 1.9% during the second quarter of this year. This information was provided in the company’s most recent disclosure with the Securities and Exchange Commission. After selling 335 shares during the quarter, Naples Global Advisors LLC now owns 16,953 shares of Watsco’s stock. This reduction in holdings means that Watsco accounts for around 0.8% of Naples Global Advisors LLC’s portfolio and is currently their 28th largest position. According to its most recent SEC filing, Naples Global Advisors LLC estimates the value of its holdings in Watsco to be worth $6,467,000.
Additionally, Watsco recently declared a quarterly dividend payment which was disbursed to shareholders on July 31st. Shareholders who were recorded as holding shares on July 17th received a dividend of $2.45 per share. The ex-dividend date for this particular dividend was on July 14th. Based on these figures, the annualized dividend amounts to $9.80 per share, resulting in a yield of approximately 2.75%. As for Watsco’s payout ratio, it currently stands at 66.08%.
It is essential for investors and stakeholders to remain updated on such developments as they play a significant role in understanding the financial health and stability of companies like Watsco, especially in the construction industry. Keeping track of institutional investors’ movements can provide useful insights into market sentiments and investor confidence.
This latest disclosure from Naples Global Advisors LLC provides an understanding of their current strategy concerning their investment holdings in Watsco and gives potential investors valuable information when making investment decisions regarding this particular company.
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Increasing Institutional Holdings in Watsco and Analysts’ Outlook on the Construction Company’s Stock
Institutional investors have been increasing their holdings in Watsco, a prominent construction company. Sei Investments Co., for example, saw a significant increase of 192.0% in its holdings during the first quarter of this year. The company now owns an impressive 54,613 shares of Watsco’s stock, valued at $17,376,000 after acquiring an additional 35,908 shares in the last quarter.
Envestnet Asset Management Inc. also lifted its stake in Watsco by 7.5% during the same period. The firm now owns 136,642 shares of the construction company’s stock worth $43,474,000 after buying an additional 9,566 shares in the last quarter.
Financial Gravity Asset Management Inc., on the other hand, boosted its holdings by 27.7%, bringing their total ownership to 318 shares worth $395,000.
Heartwood Wealth Advisors LLC took a different approach by purchasing a new stake in Watsco worth approximately $202,000 during the first quarter.
Lastly, Truist Financial Corp increased its stake by 1.0%, owning a total of 57,972 shares valued at $18,444,000 after acquiring an additional 600 shares in the last quarter.
It is interesting to note that these institutional investors and hedge funds own a whopping 89.49% of Watsco’s stock.
A number of analysts have recently issued reports on the company as well. JPMorgan Chase & Co., for instance, raised their price target from $305.00 to $325.00 and gave the stock a “neutral” rating.
Other analysts from StockNews.com and Mizuho had similar sentiments and gave Watsco a “hold” rating with neutral outlooks.
Morgan Stanley decided to go against the tide and gave Watsco an “underweight” rating while raising their price target from $326.00 to $337.00.
Among these analysts, Stephens stood out by reaffirming an “overweight” rating on Watsco while setting a much higher price objective of $450.00.
Overall, Bloomberg.com reports that there is a consensus rating of “Hold” with an average target price of $366.89 for the company.
As for its performance in the stock market, Watsco’s shares traded up $9.91 during mid-day trading on Friday, reaching $356.38. The trading volume reached 402,599 shares, exceeding its average volume of 260,486.
Watsco has a market capitalization of $13.92 billion and boasts a price-to-earnings ratio of 24.03 along with a low beta of 0.95, which indicates that it is less volatile compared to the overall market.
In terms of liquidity ratios, Watsco has a quick ratio of 1.25 and a current ratio of 3.02, suggesting that the company is in a strong financial position to meet its short-term obligations.
The construction industry has faced challenges due to various factors such as economic uncertainties and supply chain disruptions caused by the ongoing pandemic.
Despite these challenges, Watsco reported earnings results for the quarter ending on August 1st, which fell short of analysts’ consensus estimates. The company reported earnings per share (EPS) of $4.42 instead of the expected $4.87.
