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Johnson Controls (JCI)
NYSE:JCI
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Johnson Controls
(NYSE:JCI)
Rating:73Outperform
Price Target:
$118.00
â–²(8.30%Upside)
Positive Factors
Cash Conversion
JCI is currently forecasting cash conversion around 100%, driven by improvements in inventory and operating efficiencies.
Divestitures and Share Buybacks
$5bn of proceeds from the residential and light commercial divestiture expected will be deployed into share buybacks.
Management Strategy
The appointment of a new CEO, Joakim Weidemanis, is viewed positively as he has a track record of significant operating margin improvements.
Negative Factors
EPS Expectations
FY25 EPS guidance was narrowed to ~$3.60, aligning with previous estimates and raising the EBITA guide by 10bps.
EPS Guidance
Management introduced FY3Q25 adj. EPS guide of $0.97-$1.00, which comes in below consensus of $1.01.
European Market Challenges
Continuing delays in the European datacenter market due to regulatory barriers and power constraints.
Johnson Controls (JCI) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$70.60B
Dividend Yield1.36%
Average Volume (3M)4.15M
Price to Earnings (P/E)29.1
Beta (1Y)1.19
Revenue Growth-8.39%
EPS Growth51.56%
CountryUS
Employees94,000
SectorIndustrials
Sector Strength91
IndustryConstruction
Share Statistics
EPS (TTM)0.82
Shares Outstanding658,047,300
10 Day Avg. Volume3,494,087
30 Day Avg. Volume4,154,476
Financial Highlights & Ratios
PEG Ratio0.64
Price to Book (P/B)4.40
Price to Sales (P/S)0.00
P/FCF Ratio23.82
Enterprise Value/Market Cap1.11
Enterprise Value/Revenue0.84
Enterprise Value/Gross Profit9.96
Enterprise Value/Ebitda6.51
Forecast
1Y Price Target
$112.23Price Target Upside3.00% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering15
Johnson Controls Business Overview & Revenue Model
Company DescriptionJohnson Controls International (JCI) is a global diversified technology and multi-industrial leader serving a wide range of customers in more than 150 countries. The company specializes in creating intelligent buildings, efficient energy solutions, integrated infrastructure, and next-generation transportation systems. Its core products and services include building management systems, HVAC equipment, fire and security solutions, and energy storage solutions.
How the Company Makes MoneyJohnson Controls makes money through a diverse revenue model that includes the sale and servicing of building products and systems, such as heating, ventilation, and air conditioning (HVAC) equipment, as well as fire and security systems. A significant portion of its revenue comes from long-term service contracts and maintenance agreements, which provide a steady stream of income. The company also benefits from its focus on sustainability and energy efficiency, offering solutions that help clients reduce energy consumption and emissions, leading to cost savings. Partnerships with businesses, governments, and organizations worldwide further enhance its revenue streams. Additionally, Johnson Controls' global presence allows it to tap into markets across various regions, contributing to its earnings.
Johnson Controls Key Performance Indicators (KPIs)
Any
EBITDA by Segment
Shows earnings before interest, taxes, depreciation, and amortization for each business segment, highlighting which areas are most profitable and where operational efficiencies or challenges exist.
Shows earnings before interest, taxes, depreciation, and amortization for each business segment, highlighting which areas are most profitable and where operational efficiencies or challenges exist.
Data provided by:
Main Street Data
Main Street DataJohnson Controls Earnings Call Summary
Earnings Call Date:May 07, 2025
(Q2-2025)
| % Change Since: 23.13%|
Next Earnings Date:Jul 29, 2025
Earnings Call Sentiment Positive
Johnson Controls demonstrated a strong financial performance in the second quarter with notable improvements in sales growth, margins, and backlog. Despite some challenges in the Asia Pacific region and the impact of tariffs, the company showed resilience and confidence by raising its full-year guidance. The overall sentiment is positive, supported by strong execution and strategic focus on innovation and customer-centricity.Q2-2025 Updates
Positive Updates
Strong Organic Sales Growth
Johnson Controls reported a 7% organic sales growth in the second quarter, driven by continued strength in applied and resilient service businesses.
Significant Margin Expansion
Segment margins expanded by 180 basis points to 16.7%, with adjusted EPS increasing by 19%.
Record Backlog
The company grew its backlog by 12% to $14 billion, highlighting sustained demand for its solutions.
Improved Financial Management
Net debt decreased to 2.4 times, and adjusted free cash flow increased by $1.1 billion year-to-date, showcasing effective financial management.
Raised Full-Year Guidance
Johnson Controls raised its full-year guidance for margins, adjusted EPS, and free cash flow conversion due to strong first-half performance.
Data Center Market Strength
The data center segment continues to show strong growth potential, supported by Johnson Controls' differentiated high-performance YORK Chiller platform.
Negative Updates
Challenges in Asia Pacific
Orders in the Asia Pacific region were flat, with the company focusing on booking profitable system projects with upfront payments.
Tariff Impact Concerns
The company's guidance considers the current geopolitical environment, including tariffs, which are expected to impact up to 3% of cost of goods sold.
Complexities in Product Offerings
The company faces operational slowdowns due to complexities in current product offerings, number of SKUs, footprint, and operating methods.
Company Guidance
During the Johnson Controls fiscal Q2 2025 earnings call, the company reported strong performance across several metrics. Organic sales increased by 7%, and segment margins expanded by 180 basis points to 16.7%. Adjusted EPS saw a 19% rise. Additionally, orders grew by 5%, and the company achieved a record backlog growth of 12%, reaching $14 billion. Johnson Controls also ended the quarter with $800 million in available cash, with net debt at 2.4 times EBITDA. Adjusted free cash flow showed an impressive increase of $1.1 billion year-to-date. For the fiscal year, the company slightly raised guidance, now expecting adjusted segment EBITA margin to expand by roughly 90 basis points and adjusted EPS to approximate $3.60 per share, reflecting approximately 12% growth. Free cash flow conversion is anticipated to reach about 100% for the year.Johnson Controls Financial Statement Overview
Summary
Johnson Controls demonstrates solid financial health with stable margins and effective cash flow management. While revenue growth has been inconsistent, the company maintains strong profitability and a healthy balance sheet.Income Statement
The income statement shows stable gross and net profit margins with slight fluctuations. The TTM gross profit margin is approximately 37.1%, and the net profit margin is about 11.8%, indicating solid profitability. However, revenue growth has been inconsistent, with a decrease from 2023 to TTM. EBIT and EBITDA margins reflect efficient operations but have slightly decreased over recent years.70
Positive
Balance Sheet
The balance sheet presents a healthy equity base with an equity ratio of about 37.3% for TTM, indicating financial stability. The debt-to-equity ratio is approximately 0.63, showing moderate leverage. ROE stands at a robust 15.8%, reflecting efficient use of equity to generate profits.75
Positive
Cash Flow
Cash flow analysis reveals strong free cash flow growth from the last annual report to TTM, increasing by around 81.7%. The operating cash flow to net income ratio is 1.35, showing good cash generation relative to profits. Free cash flow to net income ratio is also strong at 1.16, indicating efficient cash management.80
Positive
| Breakdown | TTM | Sep 2024 | Sep 2023 | Sep 2022 | Sep 2021 | Sep 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 21.26B | 22.95B | 26.79B | 25.30B | 23.67B | 22.32B |
| Gross Profit | 7.89B | 8.08B | 8.97B | 8.34B | 8.06B | 7.41B |
| EBITDA | 3.51B | 2.80B | 2.15B | 2.88B | 3.67B | 1.97B |
| Net Income | 2.50B | 1.71B | 1.85B | 1.53B | 1.64B | 631.00M |
Balance Sheet | ||||||
| Total Assets | 42.37B | 42.70B | 42.24B | 42.16B | 41.89B | 40.81B |
| Cash, Cash Equivalents and Short-Term Investments | 795.00M | 606.00M | 835.00M | 2.03B | 1.34B | 1.95B |
| Total Debt | 9.99B | 9.49B | 10.14B | 10.23B | 9.11B | 9.03B |
| Total Liabilities | 25.34B | 25.33B | 24.55B | 24.76B | 23.14B | 22.28B |
| Stockholders Equity | 15.80B | 16.10B | 16.55B | 16.27B | 17.56B | 17.45B |
Cash Flow | ||||||
| Free Cash Flow | 2.91B | 1.60B | 1.68B | 1.39B | 1.94B | 879.00M |
| Operating Cash Flow | 3.39B | 2.10B | 2.22B | 1.99B | 2.49B | 975.00M |
| Investing Cash Flow | -254.00M | -221.00M | -1.18B | -693.00M | -1.09B | -258.00M |
| Financing Cash Flow | -3.30B | -2.08B | -2.17B | -516.00M | -2.13B | -2.81B |
Johnson Controls Technical Analysis
Positive
108.96
Price Trends
101.75
Positive
91.00
Positive
85.58
Positive
Market Momentum
1.97
Positive
71.80
Negative
95.40
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JCI, the sentiment is Positive. The current price of 108.96 is above the 20-day moving average (MA) of 105.57, above the 50-day MA of 101.75, and above the 200-day MA of 85.58, indicating a bullish trend. The MACD of 1.97 indicates Positive momentum. The RSI at 71.80 is Negative, neither overbought nor oversold. The STOCH value of 95.40 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for JCI.
Johnson Controls Risk Analysis
Johnson Controls disclosed 38 risk factors in its most recent earnings report. Johnson Controls reported the most risks in the "Legal & Regulatory" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Johnson Controls Peers Comparison
Overall Rating
UnderperformOutperform
Sector (63)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
81 Outperform | $97.45B | 37.45 | 38.45% | 0.83% | 11.43% | 28.49% | |
81 Outperform | $65.70B | 17.58 | 25.69% | 1.17% | 0.14% | 202.13% | |
75 Outperform | $21.63B | 27.16 | 131.48% | 0.85% | 7.78% | 30.10% | |
74 Outperform | $17.72B | 23.66 | 33.11% | 0.98% | -0.14% | 11.31% | |
73 Outperform | $70.60B | 29.05 | 14.92% | 1.36% | -8.39% | 51.56% | |
70 Outperform | $13.71B | 18.01 | -118.61% | 1.88% | -2.67% | -10.72% | |
63 Neutral | kr59.62B | 12.31 | 1.88% | 2.31% | 0.37% | -4.53% |
* Industrials Sector Average
Performance Comparison
JCI
Johnson Controls
108.96
39.99
57.98%
CSL
Carlisle Companies
409.59
-13.56
-3.20%
TT
Trane Technologies
447.33
113.39
33.96%
LII
Lennox International
609.43
53.46
9.62%
MAS
Masco
65.56
-6.09
-8.50%
CARR
Carrier Global
76.63
9.04
13.37%
Johnson Controls Corporate Events
Business Operations and StrategyFinancial Disclosures
Johnson Controls Announces Organizational Realignment
Neutral
May 12, 2025
On April 1, 2025, Johnson Controls International plc realigned its organizational structure from four to three regional reporting segments to enhance simplification and growth. This change aims to better reflect the company’s operational structure and align with decision-making processes. The company has released unaudited historical financial information for the three months ended March 31, 2025, to assist investors in comparing past and future financial data under the new segment structure. While this realignment affects only the reporting of operating segment results, it does not impact the company’s consolidated financial statements.
The most recent analyst rating on (JCI) stock is a Buy with a $73.00 price target. To see the full list of analyst forecasts on Johnson Controls stock, see the JCI Stock Forecast page.
Business Operations and StrategyFinancial Disclosures
Johnson Controls Realigns Organizational Structure Globally
Neutral
May 5, 2025
On April 1, 2025, Johnson Controls International plc realigned its organizational structure from four to three regional reporting segments: Americas, EMEA, and APAC. This change aims to simplify operations, accelerate growth, and align with the company’s decision-making processes. The company has provided unaudited historical financial data to help investors compare past and future performance under the new structure. The realignment affects only the reporting of segment results and does not impact the consolidated financial statements.
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.