Watsco (STU:WC3) Moat Score: 7/10 (As of Jul. 07, 2026)


STU:WC3 Watsco Inc STU:WC3
83 GF Score
Price €349.40
GF Value €362.13
Valuation Fairly Valued
! 3 Warning Signs
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What is Watsco Moat Score?

Watsco STU:WC3 +0.29% 83 Moat Score is 7 as of Jul. 07, 2026. GuruFocus rates STU:WC3 with a GF Score™ of 83/100 and a GF Value™ of €362.13 (Fairly Valued). The stock has 3 warning signs investors should review. Among 153 Industrial Distribution companies, Watsco ranks better than 99.35% on this metric.

Watsco has the Moat Score of 7, which implies that the company might have Wide Moat - Entry-level wide moat, clearly possessing durable advantages.

Watsco has Wide Moat: Watsco has a wide moat due to its leading position in HVAC distribution, strong supplier relationships, and economies of scale. It benefits from a superior distribution network and significant customer switching costs, providing durable competitive advantages.

Moat Score is a ranking system developed by GuruFocus to assess a company's ability to sustain a competitive advantage, rated on a scale from 0 to 10. It takes into account key factors such as market leadership, cost advantages, network effects, customer switching costs, and more.

The company's Moat Score is based on these criteria:

1. Market leadership and sustainable market share
2. Network effects and significant customer switching costs
3. Valuable intellectual property and patents
4. Strong brand strength and deep customer loyalty
5. Durable cost advantages (e.g., economies of scale, proprietary technology)
6. Significant regulatory barriers and exclusive licenses
7. Superior distribution network
8. Strong and sustainable pricing power
9. Consistent and impactful innovation and R&D capabilities

Based on the research, GuruFocus believes Watsco might have Wide Moat - Entry-level wide moat, clearly possessing durable advantages.

Watsco  (STU:WC3) Moat Score Explanation

The Moat Score ranges from 0 to 10, with 10 as the highest. GuruFocus divided Moat Score into following 8 categories:

Moat Score Moat Level
10Wide Moat - Exceptionally dominant and durable wide moat
8 - 9Wide Moat - Clear and robust wide moat
7Wide Moat - Entry-level wide moat, clearly possessing durable advantages
6Narrow Moat - Strong narrow moat, clearly distinguishable but not wide
5Narrow Moat - Solid narrow moat
4Narrow Moat - Discernible but modest moat
1 - 3No Moat - Very weak/transient advantages
0No Moat - No discernible moat

Watsco Moat Score Related Terms

STU:WC3 vs WCC, QXO, AIT: Moat Score Comparison

For the Industrial Distribution subindustry, Watsco's Moat Score, along with its competitors' market caps and Moat Score 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 Moat Score vs Industrial Distribution Industry

For the Industrial Distribution industry and Industrials sector, Watsco's Moat Score distribution charts can be found below:

* The bar in red indicates where Watsco's Moat Score falls into.


STU:WC3
83GF Score
Watsco Inc STU:WC3
Moat Score is just one metric. See GF Score™, valuation, warning signs, and more.
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Frequently Asked Questions Learn more about Moat Score →
What does a Moat Score of 7 mean?
Watsco (STU:WC3) has a Moat Score of 7 as of Jul. 07, 2026. Moat Score is a ranking system developed by GuruFocus to assess a company's ability to sustain a competitive advantage, rated on a scale from 0 to 10. It takes into account key factors such as market leadership, cost advantages, network effects, customer switching costs, and more. According to the industry distribution chart, Watsco ranks #1 out of 153 companies in the Industrial Distribution industry, placing it in the top 0.7%.
Is Watsco's Moat Score too high?
Watsco's current Moat Score is 7. Based on the distribution chart, Watsco ranks #1 out of 153 companies in the Industrial Distribution industry, which is in the top quartile — a strong position relative to peers. 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 Moat Score compare to WCC and QXO?
According to the Industrial Distribution industry distribution chart, Watsco ranks #1 out of 153 companies for Moat Score. This places Watsco in the top 1% of its industry — outperforming the majority of peers. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Moat Score for an Industrial Distribution company?
A good Moat Score depends on the Industrial Distribution industry context. However, Moat Score 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 Moat Score mean?
A high Moat Score can signal that a stock is expensive relative to its fundamentals. Moat Score is a ranking system developed by GuruFocus to assess a company's ability to sustain a competitive advantage, rated on a scale from 0 to 10. It takes into account key factors such as market leadership, cost advantages, network effects, customer switching costs, and more. Watsco's current Moat Score is 7. 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 €362.13, compared to a current price of €349.40 — trading 3.5% below its estimated fair value. The current Moat Score is 7. 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 Moat Score calculated?
Moat Score is calculated from a company's financial statements. For Watsco (STU:WC3), the current Moat Score is 7 as of Jul. 07, 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 €349.40 is trading 3.5% below its estimated GF Value™ of €362.13. GuruFocus considers Watsco to be Fairly Valued.

Key valuation signals for STU:WC3:

  • Moat Score: 7
  • GF Value™: €362.13 vs. price of €349.40 (3.5% below fair value)
  • GF Score™: 83/100 with 3 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

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Moat Score is just one metric. See GF Value™, 30-year financials, guru trades, warning signs, and more.

€349.40
Price
€362.13
GF Value