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KeyBanc Upgrades Watsco (WSO) to Buy; Negative Sentiment Peaking, Valuations Attractive

August 26, 2011 7:18 AM EDT
Get Alerts WSO Hot Sheet
Price: $431.97 -0.53%

Rating Summary:
    6 Buy, 13 Hold, 3 Sell

Rating Trend: Up Up

Today's Overall Ratings:
    Up: 0 | Down: 0 | New: 0
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KeyBanc upgraded Watsco (NYSE: WSO) from Hold to Buy with a price target of $67.00.

KeyBanc analyst says, "Following meetings with management of Carrier Enterprises (CE), WSO's joint venture with Carrier, we are upgrading our rating to BUY. In short, we believe negative sentiment and underlying demand weakness within the residential HVAC industry, which have supported a weaker share price, are nearing a bottom. In the meantime, we see considerable runway for growth and operational improvements at both the original CE JV and new JV, which encapsulates Carrier Northeast and Carrier Mexico. In addition, we expect WSO to continue to explore other JV opportunities (via Carrier Canada, other Carrier independent distributors), while continuing to pursue further M&A opportunities with both independents and other OE's in the space."

For more ratings news on Watsco click here and for the rating history of Watsco click here.

Shares of Watsco closed at $54.95 yesterday.


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