WSO
Watsco, Inc.
Industrial - Distribution
Market Cap$17.10B
5Y Perf.+136.5%
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Stock Comparison
WSO vs MSM
Revenue, margins, valuation, and 5-year total return — side by side.
MSM
MSC Industrial Direct Co., Inc.
Industrial - Distribution
Market Cap$5.75B
5Y Perf.+48.6%
WSO vs MSM — Key Financials
Market cap, revenue, margins, and valuation side-by-side.
| Company Snapshot | WSO | MSM |
|---|---|---|
| Industry | Industrial - Distribution | Industrial - Distribution |
| Market Cap | $17.10B | $5.75B |
| Revenue (TTM) | $7.24B | $3.81B |
| Net Income (TTM) | $496M | $205M |
| Gross Margin | 28.4% | 40.7% |
| Operating Margin | 9.8% | 8.4% |
| Forward P/E | 33.4x | 23.7x |
| Total Debt | $479M | $539M |
| Cash & Equiv. | $433M | $56M |
WSO vs MSM — Long-Term Stock Performance
Price return indexed to 100 at period start. Dividends excluded.
WSO
MSM
| Stock | May 20 | May 26 | Return |
|---|---|---|---|
| Watsco, Inc. (WSO) | 100 | 236.5 | +136.5% |
| MSC Industrial Dire… (MSM) | 100 | 148.6 | +48.6% |
Price return only. Dividends and distributions are not included.
Quick Verdict: WSO vs MSM
Each card shows where this stock fits in a portfolio — not just who wins on paper.
Bottom line: MSM leads in 4 of 7 categories, making it the strongest pick for growth and revenue expansion and valuation and capital efficiency. Watsco, Inc. is the stronger pick specifically for profitability and margin quality and dividend income and shareholder returns. As sector peers, any of these can serve as alternatives in the same allocation.
WSO
Watsco, Inc.
The Long-Run Compounder
WSO is the clearest fit if your priority is long-term compounding and sleep-well-at-night.
- 276.6% 10Y total return vs MSM's 86.2%
- Lower volatility, beta 1.10, Low D/E 14.9%, current ratio 4.12x
- 6.8% margin vs MSM's 5.4%
Best for: long-term compounding and sleep-well-at-night
MSM
MSC Industrial Direct Co., Inc.
The Income Pick
MSM carries the broadest edge in this set and is the clearest fit for income & stability and growth exposure.
- Dividend streak 4 yrs, beta 0.86, yield 3.3%
- Rev growth -1.3%, EPS growth -22.1%, 3Y rev CAGR 0.7%
- Beta 0.86, yield 3.3%, current ratio 1.68x
Best for: income & stability and growth exposure
See the full category breakdown
| Category | Winner | Why |
|---|---|---|
| Growth | MSM | -1.3% revenue growth vs WSO's -5.0% |
| Value | MSM | Lower P/E (23.7x vs 33.4x) |
| Quality / Margins | WSO | 6.8% margin vs MSM's 5.4% |
| Stability / Safety | MSM | Beta 0.86 vs WSO's 1.10 |
| Dividends | WSO | 3.0% yield, 12-year raise streak, vs MSM's 3.3% |
| Momentum (1Y) | MSM | +37.8% vs WSO's -9.6% |
| Efficiency (ROA) | WSO | 10.8% ROA vs MSM's 8.2%, ROIC 16.6% vs 12.3% |
WSO vs MSM — Revenue Breakdown by Segment
How each company's revenue is distributed across its business units
Segment breakdown not available.
FY 2025
WSO vs MSM — Financial Metrics
Side-by-side numbers across 2 stocks — who leads on profitability, valuation, growth, and risk.
BEST OVERALLWSOLAGGINGMSM
MSMMSC Industrial Direct…
2leads
WSOWatsco, Inc.
2leads
6 Total Categories
CATEGORYLEADERvs MSMMETRICS WON
Income & Cash FlowRevenue, margins, and cash flow strength
Tied
—
Valuation MetricsMultiples, price ratios, and targets
MSM6/6
Profitability & EfficiencyROE, ROIC, leverage, and quality scores
WSO7/7
Total Returns1Y, 3Y, 5Y total returns with dividends
WSO5/6
Risk & VolatilityBeta, volatility, and downside exposure
MSM2/2
Analyst OutlookRatings, price targets, and dividends
Tied
—
Income & Cash Flow (Last 12 Months)
Evenly matched — WSO and MSM each lead in 3 of 6 comparable metrics.
Income & Cash Flow (Last 12 Months)
WSO is the larger business by revenue, generating $7.2B annually — 1.9x MSM's $3.8B. Profitability is closely matched — net margins range from 6.8% (WSO) to 5.4% (MSM). On growth, MSM holds the edge at +4.0% YoY revenue growth, suggesting stronger near-term business momentum.
| Metric | WSOWatsco, Inc. | MSMMSC Industrial Di… |
|---|---|---|
| RevenueTrailing 12 months | $7.2B | $3.8B |
| EBITDAEarnings before interest/tax | $757M | $414M |
| Net IncomeAfter-tax profit | $496M | $205M |
| Free Cash FlowCash after capex | $702M | $167M |
| Gross MarginGross profit ÷ Revenue | +28.4% | +40.7% |
| Operating MarginEBIT ÷ Revenue | +9.8% | +8.4% |
| Net MarginNet income ÷ Revenue | +6.8% | +5.4% |
| FCF MarginFCF ÷ Revenue | +9.7% | +4.4% |
| Rev. Growth (YoY)Latest quarter vs prior year | +0.1% | +4.0% |
| EPS Growth (YoY)Latest quarter vs prior year | -3.1% | +12.0% |
Evenly matched — WSO and MSM each lead in 3 of 6 comparable metrics.
Valuation Metrics
MSM leads this category, winning 6 of 6 comparable metrics.
Valuation Metrics
At 28.9x trailing earnings, MSM trades at a 16% valuation discount to WSO's 34.3x P/E. On an enterprise value basis, MSM's 15.4x EV/EBITDA is more attractive than WSO's 23.3x.
| Metric | WSOWatsco, Inc. | MSMMSC Industrial Di… |
|---|---|---|
| Market CapShares × price | $17.1B | $5.7B |
| Enterprise ValueMkt cap + debt − cash | $17.1B | $6.2B |
| Trailing P/EPrice ÷ TTM EPS | 34.34x | 28.85x |
| Forward P/EPrice ÷ next-FY EPS est. | 33.37x | 23.69x |
| PEG RatioP/E ÷ EPS growth rate | 2.91x | — |
| EV / EBITDAEnterprise value multiple | 23.29x | 15.43x |
| Price / SalesMarket cap ÷ Revenue | 2.36x | 1.52x |
| Price / BookPrice ÷ Book value/share | 4.95x | 4.12x |
| Price / FCFMarket cap ÷ FCF | 31.94x | 23.86x |
MSM leads this category, winning 6 of 6 comparable metrics.
Profitability & Efficiency
WSO leads this category, winning 7 of 7 comparable metrics.
Profitability & Efficiency
WSO delivers a 15.3% return on equity — every $100 of shareholder capital generates $15 in annual profit, vs $15 for MSM. WSO carries lower financial leverage with a 0.15x debt-to-equity ratio, signaling a more conservative balance sheet compared to MSM's 0.39x.
| Metric | WSOWatsco, Inc. | MSMMSC Industrial Di… |
|---|---|---|
| ROE (TTM)Return on equity | +15.3% | +14.8% |
| ROA (TTM)Return on assets | +10.8% | +8.2% |
| ROICReturn on invested capital | +16.6% | +12.3% |
| ROCEReturn on capital employed | +19.0% | +17.5% |
| Piotroski ScoreFundamental quality 0–9 | 5 | 5 |
| Debt / EquityFinancial leverage | 0.15x | 0.39x |
| Net DebtTotal debt minus cash | $46M | $483M |
| Cash & Equiv.Liquid assets | $433M | $56M |
| Total DebtShort + long-term debt | $479M | $539M |
| Interest CoverageEBIT ÷ Interest expense | — | 12.56x |
WSO leads this category, winning 7 of 7 comparable metrics.
Total Returns (Dividends Reinvested)
WSO leads this category, winning 5 of 6 comparable metrics.
Total Returns (Dividends Reinvested)
A $10,000 investment in WSO five years ago would be worth $15,861 today (with dividends reinvested), compared to $12,864 for MSM. Over the past 12 months, MSM leads with a +37.8% total return vs WSO's -9.6%. The 3-year compound annual growth rate (CAGR) favors WSO at 10.5% vs MSM's 7.6% — a key indicator of consistent wealth creation.
| Metric | WSOWatsco, Inc. | MSMMSC Industrial Di… |
|---|---|---|
| YTD ReturnYear-to-date | +22.9% | +22.0% |
| 1-Year ReturnPast 12 months | -9.6% | +37.8% |
| 3-Year ReturnCumulative with dividends | +34.9% | +24.7% |
| 5-Year ReturnCumulative with dividends | +58.6% | +28.6% |
| 10-Year ReturnCumulative with dividends | +276.6% | +86.2% |
| CAGR (3Y)Annualised 3-year return | +10.5% | +7.6% |
WSO leads this category, winning 5 of 6 comparable metrics.
Risk & Volatility
MSM leads this category, winning 2 of 2 comparable metrics.
Risk & Volatility
MSM is the less volatile stock with a 0.86 beta — it tends to amplify market swings less than WSO's 1.10 beta. A beta below 1.0 means the stock typically moves less than the S&P 500. MSM currently trades 98.0% from its 52-week high vs WSO's 84.8% drawdown — a narrower gap to the peak suggests stronger recent price momentum.
| Metric | WSOWatsco, Inc. | MSMMSC Industrial Di… |
|---|---|---|
| Beta (5Y)Sensitivity to S&P 500 | 1.10x | 0.86x |
| 52-Week HighHighest price in past year | $496.25 | $105.09 |
| 52-Week LowLowest price in past year | $323.05 | $74.30 |
| % of 52W HighCurrent price vs 52-week peak | +84.8% | +98.0% |
| RSI (14)Momentum oscillator 0–100 | 49.3 | 61.4 |
| Avg Volume (50D)Average daily shares traded | 452K | 594K |
MSM leads this category, winning 2 of 2 comparable metrics.
Analyst Outlook
Evenly matched — WSO and MSM each lead in 1 of 2 comparable metrics.
Analyst Outlook
Wall Street rates WSO as "Hold" and MSM as "Hold". Consensus price targets imply -5.0% upside for WSO (target: $400) vs -5.1% for MSM (target: $98). For income investors, MSM offers the higher dividend yield at 3.29% vs WSO's 2.97%.
| Metric | WSOWatsco, Inc. | MSMMSC Industrial Di… |
|---|---|---|
| Analyst RatingConsensus buy/hold/sell | Hold | Hold |
| Price TargetConsensus 12-month target | $399.80 | $97.75 |
| # AnalystsCovering analysts | 26 | 28 |
| Dividend YieldAnnual dividend ÷ price | +3.0% | +3.3% |
| Dividend StreakConsecutive years of raises | 12 | 4 |
| Dividend / ShareAnnual DPS | $12.50 | $3.39 |
| Buyback YieldShare repurchases ÷ mkt cap | +0.0% | +0.7% |
Evenly matched — WSO and MSM each lead in 1 of 2 comparable metrics.
Key Takeaway
MSM leads in 2 of 6 categories (Valuation Metrics, Risk & Volatility). WSO leads in 2 (Profitability & Efficiency, Total Returns). 2 tied.
Best OverallWatsco, Inc. (WSO)Leads 2 of 6 categories
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WSO vs MSM: Frequently Asked Questions
10 questions · data-driven answers · updated daily
01Is WSO or MSM a better buy right now?
For growth investors, MSC Industrial Direct Co.
, Inc. (MSM) is the stronger pick with -1. 3% revenue growth year-over-year, versus -5. 0% for Watsco, Inc. (WSO). MSC Industrial Direct Co. , Inc. (MSM) offers the better valuation at 28. 9x trailing P/E (23. 7x forward), making it the more compelling value choice. Analysts rate Watsco, Inc. (WSO) a "Hold" — based on 26 analyst ratings — the highest consensus in this comparison. The "better buy" depends entirely on your goals: growth investors should weight revenue trajectory, value investors should weight P/E and PEG, and income investors should weight dividend yield and streak.
02Which has the better valuation — WSO or MSM?
On trailing P/E, MSC Industrial Direct Co.
, Inc. (MSM) is the cheapest at 28. 9x versus Watsco, Inc. at 34. 3x. On forward P/E, MSC Industrial Direct Co. , Inc. is actually cheaper at 23. 7x.
03Which is the better long-term investment — WSO or MSM?
Over the past 5 years, Watsco, Inc.
(WSO) delivered a total return of +58. 6%, compared to +28. 6% for MSC Industrial Direct Co. , Inc. (MSM). Over 10 years, the gap is even starker: WSO returned +276. 6% versus MSM's +86. 2%. Past returns do not guarantee future results, and the stock with the higher historical return may already have its best growth priced in.
04Which is safer — WSO or MSM?
By beta (market sensitivity over 5 years), MSC Industrial Direct Co.
, Inc. (MSM) is the lower-risk stock at 0. 86β versus Watsco, Inc. 's 1. 10β — meaning WSO is approximately 29% more volatile than MSM relative to the S&P 500. On balance sheet safety, Watsco, Inc. (WSO) carries a lower debt/equity ratio of 15% versus 39% for MSC Industrial Direct Co. , Inc. — giving it more financial flexibility in a downturn.
05Which is growing faster — WSO or MSM?
By revenue growth (latest reported year), MSC Industrial Direct Co.
, Inc. (MSM) is pulling ahead at -1. 3% versus -5. 0% for Watsco, Inc. (WSO). On earnings-per-share growth, the picture is similar: Watsco, Inc. grew EPS -7. 9% year-over-year, compared to -22. 1% for MSC Industrial Direct Co. , Inc.. Over a 3-year CAGR, MSM leads at 0. 7% annualised revenue growth. Higher growth typically commands a higher valuation multiple — check whether the premium P/E or P/S is justified by the growth rate using the PEG ratio.
06Which has better profit margins — WSO or MSM?
Watsco, Inc.
(WSO) is the more profitable company, earning 6. 9% net margin versus 5. 3% for MSC Industrial Direct Co. , Inc. — meaning it keeps 6. 9% of every revenue dollar as bottom-line profit. Operating margin tells a similar story: WSO leads at 9. 6% versus 8. 3% for MSM. At the gross margin level — before operating expenses — MSM leads at 40. 8%, reflecting greater pricing power or product mix advantage. Stronger margins indicate durable pricing power, lower cost of revenue, or higher mix of software/services. They are one of the clearest signs of business quality.
07Is WSO or MSM more undervalued right now?
On forward earnings alone, MSC Industrial Direct Co.
, Inc. (MSM) trades at 23. 7x forward P/E versus 33. 4x for Watsco, Inc. — 9. 7x cheaper on a one-year earnings basis. Analyst consensus price targets imply the most upside for WSO: -5. 0% to $399. 80.
08Which pays a better dividend — WSO or MSM?
All stocks in this comparison pay dividends.
MSC Industrial Direct Co. , Inc. (MSM) offers the highest yield at 3. 3%, versus 3. 0% for Watsco, Inc. (WSO).
09Is WSO or MSM better for a retirement portfolio?
For long-horizon retirement investors, MSC Industrial Direct Co.
, Inc. (MSM) is the stronger choice — it scores higher on the combination of lower volatility, dividend reliability, and long-term compounding (low volatility (β 0. 86), 3. 3% yield). Both have compounded well over 10 years (MSM: +86. 2%, WSO: +276. 6%), confirming both are viable long-term holds — but the lower-volatility option typically results in less emotional selling during corrections. Retirement portfolios generally favour predictability over maximum returns. Consult a financial advisor before making allocation decisions.
10What are the main differences between WSO and MSM?
Both stocks operate in the Industrials sector, making this a peer-level intra-sector comparison — the same macro tailwinds and headwinds will affect both.
In terms of investment character: WSO is a mid-cap quality compounder stock; MSM is a small-cap income-oriented stock. These fundamental differences mean investors should not choose between them on a single metric — the "better stock" depends entirely on which of these characteristics aligns with your investment strategy.
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Revenue Growth>
%
(WSO: 0.1% · MSM: 4.0%)Net Margin>
%
(WSO: 6.8% · MSM: 5.4%)P/E Ratio<
x
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