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In the last reported quarter, the company’s earnings and sales surpassed the Zacks Consensus Estimate by 18.1% and 11.8%, respectively. On a year-over-year basis, earnings and sales also increased 77.2% and 31%, respectively.
Watsco's earnings topped the consensus mark in each of the last four quarters, with the average being 22.7%.
Trend in Estimate Revision
The Zacks Consensus Estimate for the to-be-reported quarter’s earnings has increased 1.1% to $1.82 from $1.80 per share in the past seven days. The estimated figure indicates 30.9% growth from the year-ago earnings of $1.39 per share. The consensus mark for revenues is pegged at $1.38 billion, suggesting 21.6% year-over-year growth.
Solid housing and repair & remodeling activities are expected to have benefited the company’s top line in the first quarter. Also, a higher sales mix of high-efficiency systems, improved margins and operating efficiencies and acquisitions are expected to have added positives to Watsco’s quarterly performance.
Watsco has been aggressively investing in technologies to transform customer experience through e-commerce. The technology deployment will help the company improves order fill rates with speed and accuracy. Moreover, its recently launched “contactless” sales and servicing capabilities as well as curbside pick-up and touchless payment capabilities to enable contactless order fulfilment is expected to boost sales in the to-be-reported quarter.
Acquisitions have also been a vital part of WSO’s strategy. Business combinations are one of the preferred modes of solidifying the product portfolio and leveraging new business opportunities.
However, price pressure on raw materials may pressurize the company’s margins. Also, supply chain disruptions and seasonality in the residential central air conditioning replacement market are causes of concerns.
What the Zacks Model Unveils
Our proven model predicts an earnings beat for Watsco this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Here are some companies in the Zacks Construction sector, which according to our model, have the right combination of elements to post an earnings beat in their respective quarters to be reported.
Summit Materials, Inc. (SUM - Free Report) has an Earnings ESP of +5.26% and sports a Zacks Rank #1.
SUM’s earnings topped the consensus mark thrice but missed the same on the other occasion, with the average surprise being 7.5%. Earnings for the to-be-reported quarter are expected to decline 15.2% year over year.
PotlatchDeltic Corporation (PCH - Free Report) has an Earnings ESP of +7.24% and holds a Zacks Rank #2.
PCH’s earnings topped the consensus mark in all the last four quarters, with the average being 6.4%. Earnings for the to-be-reported quarter are expected to grow 18.8% year over year.
KBR, Inc. (KBR - Free Report) has an Earnings ESP of +6.64% and a Zacks Rank #2.
KBR’s earnings topped the consensus mark in all the last four quarters, with the average being 10.4%. Earnings for the to-be-reported quarter are expected to grow 10.3% year over year.
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Watsco (WSO) to Report Q1 Earnings: What's in the Offing?
Watsco, Inc. (WSO - Free Report) is slated to report first-quarter 2022 results on Apr 21, before market open.
In the last reported quarter, the company’s earnings and sales surpassed the Zacks Consensus Estimate by 18.1% and 11.8%, respectively. On a year-over-year basis, earnings and sales also increased 77.2% and 31%, respectively.
Watsco's earnings topped the consensus mark in each of the last four quarters, with the average being 22.7%.
Trend in Estimate Revision
The Zacks Consensus Estimate for the to-be-reported quarter’s earnings has increased 1.1% to $1.82 from $1.80 per share in the past seven days. The estimated figure indicates 30.9% growth from the year-ago earnings of $1.39 per share. The consensus mark for revenues is pegged at $1.38 billion, suggesting 21.6% year-over-year growth.
Watsco, Inc. Price and EPS Surprise
Watsco, Inc. price-eps-surprise | Watsco, Inc. Quote
Factors to Note
Solid housing and repair & remodeling activities are expected to have benefited the company’s top line in the first quarter. Also, a higher sales mix of high-efficiency systems, improved margins and operating efficiencies and acquisitions are expected to have added positives to Watsco’s quarterly performance.
Watsco has been aggressively investing in technologies to transform customer experience through e-commerce. The technology deployment will help the company improves order fill rates with speed and accuracy. Moreover, its recently launched “contactless” sales and servicing capabilities as well as curbside pick-up and touchless payment capabilities to enable contactless order fulfilment is expected to boost sales in the to-be-reported quarter.
Acquisitions have also been a vital part of WSO’s strategy. Business combinations are one of the preferred modes of solidifying the product portfolio and leveraging new business opportunities.
However, price pressure on raw materials may pressurize the company’s margins. Also, supply chain disruptions and seasonality in the residential central air conditioning replacement market are causes of concerns.
What the Zacks Model Unveils
Our proven model predicts an earnings beat for Watsco this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Currently, it has a Zacks Rank #2 and an Earnings ESP of +0.74%. You can see the complete list of today’s Zacks #1 Rank stocks here.
Stocks With Favorable Combination
Here are some companies in the Zacks Construction sector, which according to our model, have the right combination of elements to post an earnings beat in their respective quarters to be reported.
Summit Materials, Inc. (SUM - Free Report) has an Earnings ESP of +5.26% and sports a Zacks Rank #1.
SUM’s earnings topped the consensus mark thrice but missed the same on the other occasion, with the average surprise being 7.5%. Earnings for the to-be-reported quarter are expected to decline 15.2% year over year.
PotlatchDeltic Corporation (PCH - Free Report) has an Earnings ESP of +7.24% and holds a Zacks Rank #2.
PCH’s earnings topped the consensus mark in all the last four quarters, with the average being 6.4%. Earnings for the to-be-reported quarter are expected to grow 18.8% year over year.
KBR, Inc. (KBR - Free Report) has an Earnings ESP of +6.64% and a Zacks Rank #2.
KBR’s earnings topped the consensus mark in all the last four quarters, with the average being 10.4%. Earnings for the to-be-reported quarter are expected to grow 10.3% year over year.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.