Watsco (STU:WC3) Margin of Safety % (DCF FCF Based): -29.31% (As of Jun. 26, 2026)


STU:WC3 Watsco Inc STU:WC3
83 GF Score
Price €359.40
GF Value €359.89
Valuation Fairly Valued
! 4 Warning Signs
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What is Watsco Margin of Safety % (DCF FCF Based)?

Watsco STU:WC3 +2.33% 83 Margin of Safety % (DCF FCF Based) is -29.31% as of Jun. 26, 2026. GuruFocus rates STU:WC3 with a GF Score™ of 83/100 and a GF Value™ of €359.89 (Fairly Valued). The stock has 4 warning signs investors should review.

Margin of Safety % (DCF FCF Based) = (Intrinsic Value: DCF (FCF Based) - Current Price) / Intrinsic Value: DCF (FCF Based).

Note: Discounted FCF model is only suitable for predictable companies (Business Predictability Rank higher than 1-Star). If the company's Predictability Rank is 1-Star or Not Rated, result may not be accurate due to the low predictability of business and the data will not be stored into our database.

As of today (2026-06-26), Watsco's Predictability Rank is 2.5-Stars. Watsco's intrinsic value calculated from the Discounted FCF model is €195.48 and current share price is €359.40. Consequently,

Watsco's Margin of Safety % (DCF FCF Based) using Discounted FCF model is -29.31%.

STU:WC3 vs WCC, QXO, AIT: Margin of Safety % (DCF FCF Based) Comparison

For the Industrial Distribution subindustry, Watsco's Margin of Safety % (DCF FCF Based), along with its competitors' market caps and Margin of Safety % (DCF FCF Based) 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 Margin of Safety % (DCF FCF Based) vs Industrial Distribution Industry

For the Industrial Distribution industry and Industrials sector, Watsco's Margin of Safety % (DCF FCF Based) distribution charts can be found below:

* The bar in red indicates where Watsco's Margin of Safety % (DCF FCF Based) falls into.


STU:WC3
83GF Score
Watsco Inc STU:WC3
Margin of Safety % (DCF FCF Based) is just one metric. See GF Score™, valuation, warning signs, and more.
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Watsco Margin of Safety % (DCF FCF Based) Calculation

Watsco's Margin of Safety % (DCF FCF Based) for today is calculated as

Margin of Safety % (DCF FCF Based)=(Intrinsic Value: DCF (FCF Based)-Current Price)/Intrinsic Value: DCF (FCF Based)
=(277.93-359.40)/277.93
=-29.31 %

* 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.

The intrinsic value is calculated from the Discounted FCF model with default parameters. The calculation method is the same as Discounted Earnings model except free cash flow are used in the calculation instead of earnings per share.

What does a Margin of Safety % (DCF FCF Based) of -29.31% mean?
Watsco (STU:WC3) has a Margin of Safety % (DCF FCF Based) of -29.31% as of Jun. 26, 2026. Margin of Safety % (DCF FCF Based) is the percent difference between the current price and the intrinsic DCF FCF price. View historical data on Watsco.
Is Watsco's Margin of Safety % (DCF FCF Based) too high?
Watsco's current Margin of Safety % (DCF FCF Based) is -29.31%. 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 Margin of Safety % (DCF FCF Based) compare to WCC and QXO?
Watsco's Margin of Safety % (DCF FCF Based) of -29.31% can be compared against companies in the Industrial Distribution industry. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Margin of Safety % (DCF FCF Based) for an Industrial Distribution company?
A good Margin of Safety % (DCF FCF Based) depends on the Industrial Distribution industry context. However, Margin of Safety % (DCF FCF Based) should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Margin of Safety % (DCF FCF Based) mean?
A high Margin of Safety % (DCF FCF Based) can signal that a stock is expensive relative to its fundamentals. Margin of Safety % (DCF FCF Based) is the percent difference between the current price and the intrinsic DCF FCF price. View historical data on Watsco. Watsco's current Margin of Safety % (DCF FCF Based) is -29.31%. 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 €359.89, compared to a current price of €359.40 — trading 0.1% below its estimated fair value. The current Margin of Safety % (DCF FCF Based) is -29.31%. Watsco's overall GF Score™ is 83/100 with 4 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Margin of Safety % (DCF FCF Based) calculated?
Margin of Safety % (DCF FCF Based) is calculated from a company's financial statements. For Watsco (STU:WC3), the current Margin of Safety % (DCF FCF Based) is -29.31% as of Jun. 26, 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 €359.40 is trading 0.1% below its estimated GF Value™ of €359.89. GuruFocus considers Watsco to be Fairly Valued.

Key valuation signals for STU:WC3:

  • Margin of Safety % (DCF FCF Based): -29.31%
  • GF Value™: €359.89 vs. price of €359.40 (0.1% below fair value)
  • GF Score™: 83/100 with 4 warning signs

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 Business Description

Address 2665 South Bayshore Drive, Suite 901, Miami, FL, USA, 33133
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

Get the complete analysis for STU:WC3

Margin of Safety % (DCF FCF Based) is just one metric. See GF Value™, 30-year financials, guru trades, warning signs, and more.

€359.40
Price
€359.89
GF Value