Watsco Acquires Jackson Supply Company for $230 Million
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1 hour ago
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Should l Buy WSO?
Source: Newsfilter
- Acquisition Overview: Watsco, Inc. announced the acquisition of Jackson Supply Company for $230 million, with Jackson achieving $230 million in sales in 2025 and operating 25 locations serving approximately 5,000 customers in high-growth Sunbelt markets like Texas and Louisiana.
- Independent Operation Model: Jackson Supply will continue to operate as an independent entity with its existing management team, a strategy that not only helps maintain the company's culture and brand identity but also ensures ongoing growth in the HVAC industry.
- Strategic Growth Plans: Watsco's acquisition strategy focuses on partnering with great businesses, supporting their leadership teams, and driving aggressive growth plans, aiming to increase its market share in the $74 billion North American HVAC/R product market and further solidify its industry leadership.
- Technology Platform Integration: Watsco will leverage its industry-leading technology platforms to enhance Jackson Supply's customer experience and operational efficiency, which not only strengthens customer loyalty but also drives success in the company's digital transformation efforts.
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Analyst Views on WSO
Wall Street analysts forecast WSO stock price to fall
9 Analyst Rating
1 Buy
7 Hold
1 Sell
Hold
Current: 440.640
Low
349.00
Averages
394.14
High
460.00
Current: 440.640
Low
349.00
Averages
394.14
High
460.00
About WSO
Watsco, Inc. is a distributor of air conditioning, heating and refrigeration equipment and related parts and supplies. It sells air conditioning and heating equipment to the replacement and new construction markets for both residential and commercial applications. It also sells a variety of non-equipment products including parts, supplies, ductwork, air movement products, insulation, tools, installation supplies, thermostats, and air quality products. It provides condensing units, compressors, evaporators, valves, refrigerants, walk-in coolers, and ice machines for industrial and commercial applications. Its business units include Carrier Enterprise, Baker Distributing Company, Gemaire Distributors, East Coast Metal Distributors, Heating and Cooling Supply, Homans Associates, Pierce Phelps, N&S Supply, Acme Refrigeration, Alert Labs Inc., Tradewinds, Boreal International, Watsco Ventures, and Gateway Supply Co.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Watsco Signs Agreement to Acquire Jackson Supply Company
- Acquisition Agreement: Watsco announced it has signed a definitive agreement to acquire Jackson Supply Company, which is projected to achieve approximately $230 million in sales in 2025, thereby enhancing Watsco's market share in the HVAC/R sector.
- Independent Operation Model: Jackson Supply operates 25 locations across Sunbelt states including Texas, Louisiana, and Arizona, serving around 5,000 customers, and will continue to run independently under its existing management team post-acquisition, ensuring business continuity and stability in customer relationships.
- Transaction Timeline: The transaction is expected to close in the second quarter, subject to customary conditions and regulatory approvals, providing Watsco with strategic flexibility to adjust quickly in response to market changes.
- Market Outlook: Watsco aims for technology-driven margin expansion with a target of achieving a 30% gross margin, and the acquisition is expected to contribute to long-term financial growth potential as the A2L transition stabilizes.
See More
Watsco Q1 Earnings Beat Expectations with Strong EPS Growth
- Earnings Performance: Watsco reported a Q1 GAAP EPS of $1.87, beating expectations by $0.18, indicating strong profitability that may boost investor confidence in the company's financial health.
- Stable Revenue: The company achieved revenue of $1.53 billion, flat year-over-year but exceeding market expectations by $40 million, reflecting stability in the U.S. market that supports overall financial health.
- Market Performance Discrepancy: Overall sales in the U.S. increased by 2%, while international sales declined by 11%, highlighting resilience in the domestic market but also indicating challenges abroad that could impact future expansion strategies.
- Product Sales Dynamics: HVAC equipment sales decreased by 1% (65% of sales), while other HVAC products saw a 4% increase (30% of sales), and commercial refrigeration products rose by 11% (5% of sales), demonstrating diversification in the product mix that helps mitigate risks from market fluctuations.
See More
Watsco Acquires Jackson Supply Company for $230 Million
- Acquisition Overview: Watsco, Inc. announced the acquisition of Jackson Supply Company for $230 million, with Jackson achieving $230 million in sales in 2025 and operating 25 locations serving approximately 5,000 customers in high-growth Sunbelt markets like Texas and Louisiana.
- Independent Operation Model: Jackson Supply will continue to operate as an independent entity with its existing management team, a strategy that not only helps maintain the company's culture and brand identity but also ensures ongoing growth in the HVAC industry.
- Strategic Growth Plans: Watsco's acquisition strategy focuses on partnering with great businesses, supporting their leadership teams, and driving aggressive growth plans, aiming to increase its market share in the $74 billion North American HVAC/R product market and further solidify its industry leadership.
- Technology Platform Integration: Watsco will leverage its industry-leading technology platforms to enhance Jackson Supply's customer experience and operational efficiency, which not only strengthens customer loyalty but also drives success in the company's digital transformation efforts.
See More
Watsco Reports Q1 Results and Jackson Supply Acquisition
- Acquisition Announcement: Watsco announced the acquisition of Jackson Supply Company, a leading HVAC distributor with annual sales of $230 million, expected to close in Q2 2026, enhancing Watsco's scale and diversification in the Sunbelt markets.
- Q1 Performance: Watsco reported revenues of $1.53 billion and flat gross profit of $428 million, although operating income decreased by 2% to $110 million, cash flow usage improved significantly to $19 million, indicating enhanced operational efficiency.
- Market Trends: Market conditions improved in Q1 as the transition to A2L refrigerant products affected approximately 55% of sales, prompting Watsco to invest in inventory, technology, and training to support customers during this transition, which is expected to drive future growth.
- Technology Investment: Watsco has invested over $250 million in technology over the past five years, with Q1 e-commerce sales growing 16% to $2.6 billion, representing 36% of total sales, showcasing the company's success in digital transformation.
See More
Surge in Options Trading Volume for Watsco and Innodata
- Watsco Options Volume: Watsco Inc. saw options trading volume of 3,948 contracts, representing approximately 394,800 shares, which is about 84% of its average daily trading volume of 470,055 shares over the past month, indicating heightened investor interest in the stock.
- High Put Option Activity: Among Watsco's options, the $420 strike put option has seen 1,023 contracts traded today, equating to approximately 102,300 shares, reflecting market expectations of potential price declines, which could impact investor confidence.
- Innodata Options Trading: Innodata Inc. recorded an options trading volume of 8,086 contracts, representing around 808,600 shares, which accounts for 77% of its average daily trading volume of 1.1 million shares over the past month, showcasing the stock's active trading environment.
- Bullish Call Option Surge: For Innodata, the $55 strike call option has traded 4,943 contracts today, representing approximately 494,300 shares, indicating a bullish sentiment in the market regarding the stock's future price increase, potentially attracting more investor attention.
See More
Watsco Set to Announce Q1 Earnings on April 28
- Earnings Announcement: Watsco (WSO) is set to release its Q1 2023 earnings results on April 28 before market open, with consensus EPS estimate at $1.69 and revenue estimate at $1.49 billion, reflecting a 2.6% year-over-year decline.
- Earnings Estimate Adjustments: Over the past three months, EPS estimates have seen one upward revision and eight downward revisions, indicating market concerns regarding the company's profitability, which could impact investor confidence.
- Revenue Estimate Changes: Revenue estimates have also experienced one upward revision and eight downward revisions, reflecting a pessimistic sentiment in the market regarding Watsco's future performance, potentially leading to stock price volatility.
- Historical Performance Review: In Q4 2022, Watsco reported a GAAP EPS of $1.68, missing expectations by $0.21, with revenue of $1.58 billion falling short by $40 million, highlighting the challenges the company faces.
See More
Watsco Signs Agreement to Acquire Jackson Supply Company
- Acquisition Agreement: Watsco announced it has signed a definitive agreement to acquire Jackson Supply Company, which is projected to achieve approximately $230 million in sales in 2025, thereby enhancing Watsco's market share in the HVAC/R sector.
- Independent Operation Model: Jackson Supply operates 25 locations across Sunbelt states including Texas, Louisiana, and Arizona, serving around 5,000 customers, and will continue to run independently under its existing management team post-acquisition, ensuring business continuity and stability in customer relationships.
- Transaction Timeline: The transaction is expected to close in the second quarter, subject to customary conditions and regulatory approvals, providing Watsco with strategic flexibility to adjust quickly in response to market changes.
- Market Outlook: Watsco aims for technology-driven margin expansion with a target of achieving a 30% gross margin, and the acquisition is expected to contribute to long-term financial growth potential as the A2L transition stabilizes.
See More
Watsco Q1 Earnings Beat Expectations with Strong EPS Growth
- Earnings Performance: Watsco reported a Q1 GAAP EPS of $1.87, beating expectations by $0.18, indicating strong profitability that may boost investor confidence in the company's financial health.
- Stable Revenue: The company achieved revenue of $1.53 billion, flat year-over-year but exceeding market expectations by $40 million, reflecting stability in the U.S. market that supports overall financial health.
- Market Performance Discrepancy: Overall sales in the U.S. increased by 2%, while international sales declined by 11%, highlighting resilience in the domestic market but also indicating challenges abroad that could impact future expansion strategies.
- Product Sales Dynamics: HVAC equipment sales decreased by 1% (65% of sales), while other HVAC products saw a 4% increase (30% of sales), and commercial refrigeration products rose by 11% (5% of sales), demonstrating diversification in the product mix that helps mitigate risks from market fluctuations.
See More
Watsco Acquires Jackson Supply Company for $230 Million
- Acquisition Overview: Watsco, Inc. announced the acquisition of Jackson Supply Company for $230 million, with Jackson achieving $230 million in sales in 2025 and operating 25 locations serving approximately 5,000 customers in high-growth Sunbelt markets like Texas and Louisiana.
- Independent Operation Model: Jackson Supply will continue to operate as an independent entity with its existing management team, a strategy that not only helps maintain the company's culture and brand identity but also ensures ongoing growth in the HVAC industry.
- Strategic Growth Plans: Watsco's acquisition strategy focuses on partnering with great businesses, supporting their leadership teams, and driving aggressive growth plans, aiming to increase its market share in the $74 billion North American HVAC/R product market and further solidify its industry leadership.
- Technology Platform Integration: Watsco will leverage its industry-leading technology platforms to enhance Jackson Supply's customer experience and operational efficiency, which not only strengthens customer loyalty but also drives success in the company's digital transformation efforts.
See More
Watsco Reports Q1 Results and Jackson Supply Acquisition
- Acquisition Announcement: Watsco announced the acquisition of Jackson Supply Company, a leading HVAC distributor with annual sales of $230 million, expected to close in Q2 2026, enhancing Watsco's scale and diversification in the Sunbelt markets.
- Q1 Performance: Watsco reported revenues of $1.53 billion and flat gross profit of $428 million, although operating income decreased by 2% to $110 million, cash flow usage improved significantly to $19 million, indicating enhanced operational efficiency.
- Market Trends: Market conditions improved in Q1 as the transition to A2L refrigerant products affected approximately 55% of sales, prompting Watsco to invest in inventory, technology, and training to support customers during this transition, which is expected to drive future growth.
- Technology Investment: Watsco has invested over $250 million in technology over the past five years, with Q1 e-commerce sales growing 16% to $2.6 billion, representing 36% of total sales, showcasing the company's success in digital transformation.
See More
Surge in Options Trading Volume for Watsco and Innodata
- Watsco Options Volume: Watsco Inc. saw options trading volume of 3,948 contracts, representing approximately 394,800 shares, which is about 84% of its average daily trading volume of 470,055 shares over the past month, indicating heightened investor interest in the stock.
- High Put Option Activity: Among Watsco's options, the $420 strike put option has seen 1,023 contracts traded today, equating to approximately 102,300 shares, reflecting market expectations of potential price declines, which could impact investor confidence.
- Innodata Options Trading: Innodata Inc. recorded an options trading volume of 8,086 contracts, representing around 808,600 shares, which accounts for 77% of its average daily trading volume of 1.1 million shares over the past month, showcasing the stock's active trading environment.
- Bullish Call Option Surge: For Innodata, the $55 strike call option has traded 4,943 contracts today, representing approximately 494,300 shares, indicating a bullish sentiment in the market regarding the stock's future price increase, potentially attracting more investor attention.
See More
Watsco Set to Announce Q1 Earnings on April 28
- Earnings Announcement: Watsco (WSO) is set to release its Q1 2023 earnings results on April 28 before market open, with consensus EPS estimate at $1.69 and revenue estimate at $1.49 billion, reflecting a 2.6% year-over-year decline.
- Earnings Estimate Adjustments: Over the past three months, EPS estimates have seen one upward revision and eight downward revisions, indicating market concerns regarding the company's profitability, which could impact investor confidence.
- Revenue Estimate Changes: Revenue estimates have also experienced one upward revision and eight downward revisions, reflecting a pessimistic sentiment in the market regarding Watsco's future performance, potentially leading to stock price volatility.
- Historical Performance Review: In Q4 2022, Watsco reported a GAAP EPS of $1.68, missing expectations by $0.21, with revenue of $1.58 billion falling short by $40 million, highlighting the challenges the company faces.
See More
