Watsco, Inc. cash flow to debt ratio of 118.97% indicates that the company generates enough cash to cover a substantial portion of its debt. This level indicates very strong financial health.

Watsco, Inc.'s free cash flow has decreased 27.99% from $743.01M last year to $535.06M, signaling decreasing performance

Watsco, Inc.'s debt to equity ratio is 0.18, which means that the company's assets are healthy financed, signaling financial stability.

Watsco, Inc.'s debt has increased relative to shareholder equity from 0.17 last year to 0.18 today, signaling weakened financials

Watsco, Inc. has a net cash position, so leverage is healthy.

Watsco, Inc. earns at least as much interest as it pays. Interest obligations are fully covered.

Watsco, Inc.'s profit margin has decreased (7.22%) in the last year from 7.04% to 6.53%, signaling decreasing performance

Watsco, Inc.'s short-term assets of $2.95B exceed its short-term liabilities of $717.74M

Watsco, Inc.'s return on assets of 9.36% is higher than the 5.00% threshold, indicating efficient asset utilization

Watsco, Inc.'s return on equity of 16.76%, is higher than 15.00%, indicating good performance

Watsco, Inc.'s operating cash flow exceeds its net income, indicating high-quality earnings backed by actual cash generation

Watsco, Inc. had positive net income in 5 out of 5 years, indicating stable and consistent earnings

Watsco, Inc. has positive free cash flow, indicating the company generates cash after capital expenditures

Watsco, Inc. has a free cash flow yield of 3.98%, which is above the 2.00% threshold, indicating strong cash generation relative to market value

Watsco, Inc.'s yearly earnings has decreased 7.33% since last year from $536.29M to $496.99M, signaling decreasing performance

Watsco, Inc.'s yearly revenue has decreased 4.98% since last year from $7.62B to $7.24B, signaling decreasing performance

ROIC 13.10% (Source: FMP key-metrics). At or above the 10% threshold. Score: 2 of 2. The company is generating returns above the upper end of the typical US weighted-average cost of capital range under this definition of invested capital.

Watsco, Inc.'s 3-year revenue CAGR of -0.16% is negative, indicating declining revenue over the past 3 years

Watsco, Inc. had revenue growth in 4 out of 5 years, indicating consistent revenue performance

Watsco, Inc. had positive ROE in 5 out of 5 years, indicating consistent and reliable returns on equity

Watsco, Inc. is overvalued relative to its fair value price of 157.58 based on Discounted Cash Flow model

Watsco, Inc. has an earnings yield of 3.82%, which is below the 4.00% threshold, indicating the stock may be expensive relative to its earnings

Watsco, Inc. is overvalued relative to its fair value price of 133.43 based on EBITDA multiple model

Watsco, Inc. has an EV/EBITDA ratio of 16.89x, which is below the 20.00x threshold, indicating reasonable valuation relative to its operating earnings

Watsco, Inc. is undervalued relative to its fair value price of 364.60 based on Earnings Fair Value model

Watsco, Inc. has a PEG-ratio over 1 which is considered overvalued

Watsco, Inc. has a price-to-book ratio of 3.58x, which is below the 5.00x threshold, indicating reasonable valuation relative to its book value

Watsco, Inc. has a price-to-sales ratio of 1.71x, which is below the 8.00x threshold, indicating reasonable valuation relative to its revenue