Watsco Inc
NYSE: WSO · INDUSTRIALS · INDUSTRIAL DISTRIBUTION
Updated 2026-04-29
Watsco Inc (WSO) Stock Valuation Analysis
Fair value estimate, historical valuation range, and quality signals for WSO.
Current price exceeds what fundamentals support. Risk/reward skewed unfavorably.
WSO historical valuation range
Where current P/E sits in WSO's own 5Y range.
WSO intrinsic value (DCF)
DCF-based fair value estimate vs current market price.
Intrinsic value calculated using discounted cash flow (DCF) model based on projected free cash flows, discount rate, and terminal growth assumptions. A positive margin of safety indicates the current price is below estimated fair value, providing a cushion against estimation error.
WSO valuation signals
Quick-read green flags, caution flags, and risks based on current metrics.
P/E Ratio — History
Current: 34.95x
P/S Ratio — History
Current: 2.41x
Is WSO overvalued in 2026?
Watsco Inc (WSO) currently trades at $428.51 per share with a market capitalization of $17,421,119,000.00. Based on our multi-factor framework, the stock appears richly valued with a Smart Value Score of 45/100. This score blends growth quality, financial health, and price attractiveness into a single institutional-grade read.
The stock trades at a P/E ratio of 35.0x, above its 5-year median of 31.9x. The PEG ratio of 1.73 points to a price that reasonably reflects expected earnings growth.
Looking at its own history, WSO is currently trading more expensive than 72% of the last 5Y on P/E. This places it in the 72th percentile of its historical range, a reasonable but unremarkable position.
Our discounted cash flow model estimates WSO's intrinsic value at $290.63 per share, against the current market price of $428.51. This implies a premium to fair value of -47.12%. The current price sits well above what projected cash flows justify, implying investors are paying for growth that has not yet materialized.
Financial quality is a concern. The Piotroski F-Score of 3/9 flags weakening fundamentals that deserve closer scrutiny before the valuation case can be fully trusted.
Bottom line: WSO appears richly valued on our framework, with a Smart Value Score of 45/100. At current levels the risk/reward is skewed against the buyer. A materially lower price or significant operational improvement would be needed to change the picture.
Frequently asked questions
Is WSO overvalued in 2026?
Based on a Smart Value Score of 45/100, WSO appears overvalued. Current price exceeds what fundamentals currently justify.
What is WSO's fair value?
Our DCF model estimates WSO's intrinsic value at $290.63 per share, versus the current price of $428.51. This produces a margin of safety of -47.12%.
What P/E ratio does WSO trade at?
WSO trades at a P/E of 35.0x on trailing twelve-month earnings, compared to its 5-year median of 31.9x.
Is WSO a buy based on valuation?
WallStSmart does not issue buy or sell recommendations. Our Smart Value Score of 45/100 reflects the combined read on growth, quality, and price. The profile skews cautious. Consider waiting for a better price or clearer operational improvement.
How does WSO's valuation compare to its history?
On P/E, WSO currently sits in the 72th percentile of its own 5Y range. That is above its long-run median relative to where it has traded over the period.
What is WSO's Smart Value Score?
WSO's Smart Value Score is 45/100. The Smart Value Score is a proprietary WallStSmart metric blending growth quality, financial health, and valuation attractiveness into a single 0-100 read. Scores above 75 are rare and indicate strong multi-factor alignment.