Watsco continues its bullish rally to test new highs.
From a fundamental viewpoint, the group is in a good financial situation. The debt level is very low, as shown by the financial leverage of only 0.43x for 2013. The group also have an attractive valuation level, of 0.93x for this year.
Since several months, the stock has initiated a sharp bullish trend mainly due to strong fundamentals. The move should be continued, supported by the 20-day moving average, and allow the stock to cross the USD 96.4 resistance.
Therefore, investors could take a long position in Watsco, on crossing of the USD 96.4 resistance, to target the USD 101, corresponding to the bullish trend line. A stop loss should be placed bellow the 20-day moving average.
Watsco, Inc. is engaged in the distribution of air conditioning, heating and refrigeration equipment and related parts and supplies (HVAC/R) with locations in the United States, Canada, Mexico, and Puerto Rico, and on an export basis to Latin America and the Caribbean. The Company sells products to the commercial refrigeration market, which include condensing units, compressors, evaporators, valves, refrigerants, walk-in coolers, and ice machines for industrial and commercial applications. It also sells a variety of non-equipment products including parts, ductwork, air movement products, insulation, tools, installation supplies, thermostats, and air quality products. It distributes products manufactured by Flexible Technologies, Inc. (Flexible Technologies), Resideo Technologies, Inc. (Resideo), Copeland Corporation, LLC, The Chemours Company (Chemours), Mueller Industries, Inc. (Mueller), and Welbilt, Inc. (Welbilt), among others. The Company operates in approximately 692 locations.
WATSCO, INC. 
