NYSE Shariah screener · October 2026

Is Watsco, Inc. (WSO) Halal?

Q: What does Watsco do?

Watsco, Inc. (NYSE: WSO) is the largest distributor of air conditioning, heating, and refrigeration equipment and related parts and supplies in North America. Per its FY2025 Form 10-K (fiscal year ended December 31, 2025, filed February 27, 2026), it distributes residential and commercial HVAC equipment, replacement parts such as compressors, evaporator coils and motors, and supplies such as thermostats, insulation, refrigerants, and sheet metal. It serves contractors and dealers in the residential replacement, commercial, and residential new-construction markets, sourcing from manufacturers including Carrier, Rheem, Trane, Goodman, Nordyne, and Lennox, with operations across the United States, Canada, Mexico, Puerto Rico, Latin America, and the Caribbean Basin.

Q: Is Watsco's business Shariah compliant?

Watsco is a wholesale distributor of HVAC and refrigeration equipment, parts, and supplies - it buys equipment from manufacturers and sells it to contractors and dealers. It is not an interest-based lender and is not involved in conventional banking or insurance, alcohol, tobacco, gambling, pork, weapons, or adult entertainment. For transparency: its filings note purchasing concentration with Carrier and a contractual dispute with Gree over a distribution agreement renewal (Gree-branded products were under 3% of consolidated revenues over the preceding 12 months) - ordinary commercial matters, not haram business lines. Assessed on the filed business description, the business passes this screener's first gate.

Q: How much interest-bearing debt does Watsco have?

Watsco carries effectively no interest-bearing debt. Its Q2 2026 Form 10-Q (June 30, 2026, filed August 7, 2026) reports no outstanding balance on its $600 million revolving credit facility, and management describes a 'debt-free balance sheet.' Against a market capitalization of about $13.21 billion (Finnhub, October 2, 2026), interest-bearing debt of zero is 0.00% - far under the 33% ceiling. Cash and cash equivalents of $364,189 thousand plus $100,000 thousand in short-term cash investments at June 30, 2026 represent about 3.5% of market cap.

Q: What do third-party Shariah screeners say about Watsco?

Zoya publishes a WSO page citing FY2025 figures ($17,329,000 interest income against $7,239,290,000 revenue, about 0.24%) under its AAOIFI methodology, but the compliance rating on the page did not render in a text fetch, so its current rating could not be verified from public sources. I could not verify a Musaffa rating page for WSO or a ShariaPortfolio rating from public sources. Third-party screeners apply different assumptions and update on different schedules, and their results can change when new financial statements are published - always check the latest screening before investing.

PASS

Watsco, Inc. · NYSE: WSO · Industrials

The short answer

Watsco passes all three Shariah gates: it is a wholesale distributor of HVAC and refrigeration equipment (no interest-based business), carries effectively zero interest-bearing debt (0.00% of its ~$13.21 billion market cap), and interest income of about 0.24% of revenue is under the 5% ceiling.

Gate 1 — Business activity: PASS

Gate 1 — business activity: PASS. Watsco, Inc., per its FY2025 Form 10-K (fiscal year ended December 31, 2025, filed February 27, 2026), is 'the largest distributor of air conditioning, heating and refrigeration equipment, and related parts and supplies' in North America. It distributes residential and commercial HVAC equipment, replacement parts (compressors, evaporator coils, motors), and supplies (thermostats, insulation materials, refrigerants, sheet metal, tools), serving contractors and dealers in the residential replacement, commercial, and residential new-construction markets.

It sources from manufacturers including Carrier, Rheem, Trane, Goodman, Nordyne, and Lennox, and operates across the United States, Canada, Mexico, Puerto Rico, Latin America, and the Caribbean Basin. It is not an interest-based lender and is not involved in conventional banking or insurance, alcohol, tobacco, gambling, pork, weapons, or adult entertainment. For transparency, its filings note purchasing concentration with Carrier and a contractual dispute with Gree over a distribution-agreement renewal (Gree-branded products under 3% of consolidated revenues) — ordinary commercial matters, not haram lines. The business passes gate 1.

Gate 2 — Debt and cash: PASS

Gate 2 — interest-bearing debt: PASS (0.00%, ceiling 33%). Per Watsco's Q2 2026 condensed consolidated balance sheet (June 30, 2026, filed August 7, 2026), there was no outstanding balance on its $600 million revolving credit facility — management describes a 'debt-free balance sheet.' Lease liabilities are excluded as they are not interest-bearing debt.

Zero interest-bearing debt against a market capitalization of about $13.21 billion (Finnhub, October 2, 2026; $301.15 per share) is 0.00%, far under the 33% ceiling. Cash and cash equivalents of $364,189 thousand plus short-term cash investments of $100,000 thousand at June 30, 2026 represent about 3.5% of market cap.

Gate 3 — Non-compliant income: PASS

Gate 3 — non-compliant income: PASS (0.24%, ceiling 5%). Watsco's FY2025 Form 10-K separately discloses 'Interest (income) expense, net' on its Consolidated Statements of Income: $17,329 thousand of net interest income against revenues of $7,239,290 thousand is about 0.24% — far under the 5% ceiling. The company also disclosed net interest income of $20,869 thousand in FY2024.

Zoya's WSO page cites the same FY2025 figures ($17,329,000 interest income against $7,239,290,000 revenue, about 0.24%) under its AAOIFI methodology. The most recent annual figure (0.24%) is used for this gate.

Key figures used

Business: largest North American distributor of HVAC/R equipment, parts, and supplies — residential/commercial HVAC equipment, compressors, coils, motors, thermostats, insulation, refrigerants, sheet metal; serves contractors/dealers in replacement, commercial, and new-construction markets; sources from Carrier, Rheem, Trane, Goodman, Nordyne, Lennox; operates across US, Canada, Mexico, Puerto Rico, Latin America, Caribbean Basin
Haram assessment: no interest-based lending; no conventional banking/insurance, alcohol, tobacco, gambling, pork, weapons, or adult entertainment — clean wholesale distribution business; purchasing concentration with Carrier and a Gree distribution-agreement dispute (Gree products <3% of revenue) are ordinary commercial matters
Debt: no outstanding balance on $600M revolving credit facility at June 30, 2026; management describes a 'debt-free balance sheet'; 0.00% of ~$13.21B market cap (Finnhub, Oct 2, 2026) — far under the 33% ceiling
Cash: $364,189K cash & equivalents + $100,000K short-term cash investments at June 30, 2026 (~3.5% of market cap); $464M cash and cash investments per Q2 2026 earnings release
Interest income: $17,329K net interest income in FY2025 vs $7,239,290K revenues = 0.24% — far under the 5% ceiling (FY2024: $20,869K; H1 2026: $9,956K)
Market data: NYSE-listed (per 10-K cover); still listed (confirmed October 2, 2026; live quotes, no delisting); acquired Jackson Supply Company (~$230M annualized sales, 25 Sunbelt locations) in Q2 2026; annual dividend raised 10% to $13.20/share for 2026
Third-party: Zoya publishes a WSO page (AAOIFI, FY2025 figures cited) but its current rating could not be verified from the page text; no verifiable Musaffa or ShariaPortfolio rating found

Frequently asked questions

What does Watsco do?

Watsco, Inc. (NYSE: WSO) is the largest distributor of air conditioning, heating, and refrigeration equipment and related parts and supplies in North America. Per its FY2025 Form 10-K (fiscal year ended December 31, 2025, filed February 27, 2026), it distributes residential and commercial HVAC equipment, replacement parts such as compressors, evaporator coils and motors, and supplies such as thermostats, insulation, refrigerants, and sheet metal. It serves contractors and dealers in the residential replacement, commercial, and residential new-construction markets, sourcing from manufacturers including Carrier, Rheem, Trane, Goodman, Nordyne, and Lennox, with operations across the United States, Canada, Mexico, Puerto Rico, Latin America, and the Caribbean Basin.

Is Watsco's business Shariah compliant?

Watsco is a wholesale distributor of HVAC and refrigeration equipment, parts, and supplies - it buys equipment from manufacturers and sells it to contractors and dealers. It is not an interest-based lender and is not involved in conventional banking or insurance, alcohol, tobacco, gambling, pork, weapons, or adult entertainment. For transparency: its filings note purchasing concentration with Carrier and a contractual dispute with Gree over a distribution agreement renewal (Gree-branded products were under 3% of consolidated revenues over the preceding 12 months) - ordinary commercial matters, not haram business lines. Assessed on the filed business description, the business passes this screener's first gate.

How much interest-bearing debt does Watsco have?

Watsco carries effectively no interest-bearing debt. Its Q2 2026 Form 10-Q (June 30, 2026, filed August 7, 2026) reports no outstanding balance on its $600 million revolving credit facility, and management describes a 'debt-free balance sheet.' Against a market capitalization of about $13.21 billion (Finnhub, October 2, 2026), interest-bearing debt of zero is 0.00% - far under the 33% ceiling. Cash and cash equivalents of $364,189 thousand plus $100,000 thousand in short-term cash investments at June 30, 2026 represent about 3.5% of market cap.

How much interest income does Watsco earn?

Watsco's FY2025 Form 10-K separately discloses 'Interest (income) expense, net' on its Consolidated Statements of Income: net interest income of $17,329 thousand against revenues of $7,239,290 thousand is about 0.24% - far under the 5% non-compliant income ceiling. The company also disclosed net interest income of $20,869 thousand in FY2024. Quarterly filings show the same separate line (for example, $9,956 thousand for the six months ended June 30, 2026). The most recent annual figure (0.24%) is used for this gate.

What do third-party Shariah screeners say about Watsco?

Zoya publishes a WSO page citing FY2025 figures ($17,329,000 interest income against $7,239,290,000 revenue, about 0.24%) under its AAOIFI methodology, but the compliance rating on the page did not render in a text fetch, so its current rating could not be verified from public sources. I could not verify a Musaffa rating page for WSO or a ShariaPortfolio rating from public sources. Third-party screeners apply different assumptions and update on different schedules, and their results can change when new financial statements are published - always check the latest screening before investing.

Sources

Screened 2026-10-02 from published company figures and market data. Figures change; this page is educational, not financial advice and not a religious ruling.

Screened with our two-gate Shariah screening methodology (business-activity gate, then AAOIFI-style financial ratios).