WATSCO INC 10-K

ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market Information Our Common stock is listed on the New York Stock Exchange under the ticker symbol WSO, and our Class B common stock is listed on the New York Stock Exchange under the ticker symbol WSOB. Holders At February 21, 2023, there were 260 registered holders of our Common stock and 152 registered holders of our Class B common stock. 19 Table of Contents Shareholder Return Performance The following graph compares the cumulative five-year total shareholder return attained by holders of our Common stock and Class B common stock relative to the cumulative total returns of the Russell 2000 index, the S&P MidCap 400 index, the S&P 500 index, and the S&P 400 Industrials index. Given our position as the largest distributor of HVAC/R equipment, parts and supplies in North America, our unique, sole line of business, the nature of our customers (air conditioning and heating contractors), and the products and markets we serve, we cannot reasonably identify an appropriate peer group; therefore, we have included in the graph below the performance of certain major market indices, which contain companies with market capitalizations similar to our own. We have determined to add the S&P 400 Industrials Index in the graph below because it more closely relates to the industry in which we operate. The graph tracks the performance of a $100 investment in our common stock and in each index (with the reinvestment of all dividends) from December 31, 2017 to December 31, 2022. The performance graph shall not be deemed incorporated by reference by any general statement incorporating by reference this annual report into any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, as amended, except to the extent we specifically incorporate this information by reference, and shall not otherwise be deemed filed under such acts. 12/31/17 12/31/18 12/31/19 12/31/20 12/31/21 12/31/22 Watsco, Inc. 100.00 84.48 114.00 148.79 211.38 173.93 Watsco, Inc. Class B 100.00 82.60 115.56 154.05 208.80 177.20 Russell 2000 Index 100.00 88.99 111.70 134.00 153.85 122.41 S&P MidCap 400 Index 100.00 88.92 112.21 127.54 159.12 138.34 S&P 500 Index 100.00 95.62 125.72 148.85 191.58 156.89 S&P 400 Industrials 100.00 85.11 113.67 132.41 170.07 150.52 20 Table of Contents Purchases of Equity Securities by the Issuer and Affiliated Purchasers Period Total Number of Shares Purchased Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (1) Maximum Dollar Value that May Yet Be Purchased Under the Plans or Programs (1) October 1, 2022 to October 31, 2022(1) 311,408 $ 271.73 — $ — November 1, 2022 to November 30, 2022 — — — — December 1, 2022 to December 31, 2022 — — — — Total 311,408 $ 271.73 — $ — (1) On October 15, 2022, 975,622 shares of Class B restricted stock previously granted to our CEO during the period from 1997 to 2011 under various performance-based incentive plans vested. The vested shares had a value of $265.1 million based on the closing price of our Class B common stock as of that date. This vested value constitutes taxable compensation to our CEO for income tax purposes and was subject to statutory withholding. Upon vesting, we funded $104.3 million in statutory withholding, which, in turn, was satisfied by the CEO through a cash payment to us of $19.7 million and by the surrendering of 311,408 shares of Class B common stock, which we retired. In September 1999, our Board of Directors authorized the repurchase, at management’s discretion, of up to 7,500,000 shares of common stock in the open market or via private transactions. No shares were repurchased under this plan during 2022, 2021 or 2020. In aggregate, 6,370,913 shares of Common and Class B common stock have been repurchased at a cost of $114.4 million since the inception of this plan. At December 31, 2022, there were 1,129,087 shares remaining authorized for repurchase under this plan. Shares were last repurchased by the Company under this plan in 2008. ITEM 6. [RESERVED] ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Our 2022 Annual Report contains “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” which section is incorporated herein by reference. ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK Our 2022 Annual Report contains “Quantitative and Qualitative Disclosures about Market Risk,” which section is incorporated herein by reference.