Applied Industrial Technologies Inc (AIT) is overvalued and Watsco Inc (WSO) is overvalued.
Both trade above our estimate of their intrinsic value. AIT is the closer of the two: -52%, against -63% for WSO.
Values as of the 22 Sept 2026 close.
Discounting its cash flows at 9.3% (average of 3 methods) values the shares at $216.68; the price of $329.79 is 52% above that value, and 75% of that value comes from beyond year five.
Leak Score 59/100 on 3 of 12 signals
Discounting its cash flows at 9.8% (average of 3 methods) values the shares at $199.68; the price of $325.58 is 63% above that value, and 73% of that value comes from beyond year five.
Leak Score 59/100 on 3 of 12 signals
| Metric | AIT | WSO |
|---|---|---|
| Verdict | Overvalued | Overvalued |
| Price | $329.79 | $325.58 |
| Intrinsic value | $216.68 | $199.68 |
| Margin of safety | -52% | -63% |
| Leak Score | 59/100 (3/12) | 59/100 (3/12) |
| Market cap | $12.1B | $13.4B |
| Revenue growth, 5 years | 8.9% | 7.4% |
| Operating margin | 11.7% | 9.0% |
| Net margin | 8.3% | 6.1% |
| Return on equity | 22.4% | 15.3% |
| Debt to equity | 0.26 | 0.18 |
| P/E | 30.1x | 28.3x |
| Forward P/E | 24.9x | 24.8x |
| P/B | 6.5x | 4.5x |
| Dividend yield | 0.6% | 3.8% |