Watsco's Days Sales Outstanding for the
three
months ended in Mar. 2026 was 48.37.
Watsco's Days Inventory for the
three
months ended in Mar. 2026 was 127.28.
Watsco's Days Payable for the
three
months ended in Mar. 2026 was 38.52.
Therefore, Watsco's Cash Conversion Cycle (CCC) for the
three
months ended in Mar. 2026 was 137.13.
Generally, the lower this number is, the better for the company. Although it should be combined with other metrics (such as ROE % and ROA %), it can be especially useful for comparing close competitors, because the company with the lowest CCC is often the one with better management.
Be Aware
CCC is most effective with retail-type companies, which have inventories that are sold to customers. Consulting businesses, software companies and insurance companies are all examples of companies for whom this metric is meaningless.
The CCC is one of several tools that can help you evaluate management, especially if it is calculated for several consecutive time periods and for several competitors. Decreasing or steady CCCs are good, while rising ones should motivate you to dig a bit deeper.
Watsco Cash Conversion Cycle Related Terms
Watsco Cash Conversion Cycle Historical Data
* Premium members only.
The historical data trend for Watsco's Cash Conversion Cycle can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
STU:WC3 vs WCC, QXO, AIT: Cash Conversion Cycle Comparison
For the Industrial Distribution subindustry, Watsco's Cash Conversion Cycle, along with its competitors' market caps and Cash Conversion Cycle data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Watsco Cash Conversion Cycle vs Industrial Distribution Industry
For the Industrial Distribution industry and Industrials sector, Watsco's Cash Conversion Cycle distribution charts can be found below:
* The bar in red indicates where Watsco's Cash Conversion Cycle falls into.
Cash Conversion Cycle (CCC) measures how fast a company can convert cash on hand into even more cash on hand. This metric looks at the amount of time needed to sell inventory, the amount of time needed to collect receivables and the length of time the company is afforded to pay its bills without incurring penalties.
Cash Conversion Cycle is one of several measures of management effectiveness.
Watsco's Cash Conversion Cycle for the fiscal year that ended in Dec. 2025 is calculated as
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Watsco (STU:WC3) has a Cash Conversion Cycle of 137.13 as of Mar. 2026. Cash conversion cycle equals sum of days inventory and days sales outstanding less days payable. View historical data on Watsco and its competitors.
Is Watsco's Cash Conversion Cycle too high?
Watsco's current Cash Conversion Cycle is 137.13. The Industrial Distribution industry median Cash Conversion Cycle is 99.15. Watsco's value of 137.13 is 38.3% above this industry median. Overall, Watsco has a GF Score™ of 83/100 and is considered Fairly Valued, reflecting its overall financial health beyond just this single metric.
How does Watsco's Cash Conversion Cycle compare to WCC and QXO?
Watsco's Cash Conversion Cycle of 137.13 can be compared against companies in the Industrial Distribution industry. The industry median Cash Conversion Cycle is 99.15. Watsco's value of 137.13 is 38.3% above this benchmark. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Cash Conversion Cycle for an Industrial Distribution company?
The median Cash Conversion Cycle among Industrial Distribution companies is 99.15, based on 156 companies in the industry. Companies in the top quartile (top 25%) have a Cash Conversion Cycle significantly above this median, while those in the bottom quartile fall well below. However, Cash Conversion Cycle should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Watsco's current Cash Conversion Cycle of 137.13 is 38.3% above the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Cash Conversion Cycle mean?
A high Cash Conversion Cycle can signal that a stock is expensive relative to its fundamentals. Cash conversion cycle equals sum of days inventory and days sales outstanding less days payable. View historical data on Watsco and its competitors. For the Industrial Distribution industry, the median Cash Conversion Cycle is 99.15 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Watsco's current Cash Conversion Cycle is 137.13. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Watsco stock overvalued right now?
Based on GuruFocus' analysis, Watsco (STU:WC3) is currently considered Fairly Valued. The stock's GF Value™ is €355.94, compared to a current price of €348.40 — trading 2.1% below its estimated fair value. The current Cash Conversion Cycle is 137.13 and 38.3% above the Industrial Distribution industry median of 99.15. Watsco's overall GF Score™ is 83/100 with 3 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Cash Conversion Cycle calculated?
Cash Conversion Cycle is calculated from a company's financial statements. For Watsco (STU:WC3), the current Cash Conversion Cycle is 137.13 as of Mar. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Watsco (STU:WC3) Overvalued in 2026?
Based on GuruFocus' analysis, Watsco stock appears to be undervalued.
The current stock price of €348.40 is trading 2.1% below its estimated GF Value™ of €355.94.
GuruFocus considers Watsco to be Fairly Valued.
Key valuation signals for STU:WC3:
Cash Conversion Cycle: 137.13
GF Value™: €355.94 vs. price of €348.40 (2.1% below fair value)
Industry Position: 38.3% above the Industrial Distribution median
No single metric tells the full story. See the STU:WC3 stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Watsco is the largest HVAC and refrigeration products distributor in North America with approximately 13% market share. The company primarily operates in the United States (90% of revenue) with significant exposure in the Sunbelt states. Watsco also has operations in Canada, Latin America, and the Caribbean. The company's customer base comprises more than 120,000 dealers and contractors serving the replacement and new-construction HVAC/R markets for residential and light-commercial applications. As much as 20% of residential HVAC units are distributed through Watsco in any given year. Revenue is approximately 75%-80% residential HVAC and 20%-25% commercial, with relatively small exposure to more complex "applied" solutions.
83GF Score
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