Should You Consider Adding Watsco (WSO) to Your Portfolio?

Conestoga Capital Advisors, an asset management company, released its “Conestoga Mid Cap Growth Fund” third-quarter investor letter. A copy of the same can be downloaded here. In the third quarter, the Mid Cap composite returned -4.84% net of fees compared to a -0.65% return for the Russell Mid Cap Growth Index. Negative stock selection and allocation effects led to the fund’s underperformance in the quarter. In addition, please check the fund’s top five holdings to know its best picks in 2022.

Conestoga Capital Advisors highlighted stocks like Watsco, Inc. (NYSE:WSO). Headquartered in Miami, Florida, Watsco, Inc. (NYSE:WSO) is a HVAC equipment distributor. On December 16, 2022, Watsco, Inc. (NYSE:WSO) stock closed at $255.35 per share. One-month return of Watsco, Inc. (NYSE:WSO) was -7.60%, and its shares lost 14.84% of their value over the last 52 weeks. Watsco, Inc. (NYSE:WSO) has a market capitalization of $10.013 billion.

Conestoga Capital Advisors made the following comment about Watsco, Inc. (NYSE:WSO) in its Q3 2022 investor letter:

“Watsco, Inc. (NYSE:WSO): WSO is the nation’s largest distributor of heating, ventilation and air conditioning (HVAC) equipment, parts and supplies with 80% of revenue tied to the Sun Belt region. We added this SMid Cap portfolio holding (since 2017) given its high replacement driven revenue model. While the company benefitted from at home spend during the pandemic, we believe potential volume declines can be offset by the higher pricing associated with new Department of Energy minimum efficiency requirements that go into effect in 2023.”

Photo by Sigmund on Unsplash

Watsco, Inc. (NYSE:WSO) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 26 hedge fund portfolios held Watsco, Inc. (NYSE:WSO) at the end of the third quarter, which was 25 in the previous quarter. In addition, please check out our hedge fund investor letters Q3 2022 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.