Johnson Controls (JCI) AI Stock Analysis

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Johnson Controls

(NYSE:JCI)

Select Model

Outperform 70 (OpenAI - 4o)

Rating:70Outperform

Price Target:

$133.00

▲(17.75% Upside)

Johnson Controls' strong earnings call performance and strategic initiatives are the most significant factors driving the score. Financial performance is robust, but challenges in cash flow and valuation concerns slightly offset the positive outlook. Technical indicators suggest caution due to potential overbought conditions.

Positive Factors

Revenue Growth

Consistent revenue and margin growth indicate strong market demand and effective cost management, supporting long-term financial health.

Technological Advancements

Investments in advanced cooling solutions for AI-driven data centers position JCI as a leader in high-demand tech markets.

Strategic Backlog Growth

A growing backlog reflects sustained demand and provides revenue visibility, supporting stable future cash flows.

Negative Factors

Challenges in APAC Region

Declining sales in APAC, especially in China, could hinder overall growth and market expansion efforts in a key region.

Increased Leverage

Increased leverage may limit financial flexibility and increase risk, impacting the company's ability to invest in growth opportunities.

Patent Infringement Lawsuit

Ongoing litigation could lead to financial liabilities and distract management, potentially affecting long-term strategic initiatives.

Johnson Controls (JCI) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$68.53B

Dividend Yield1.27%

Average Volume (3M)5.69M

Price to Earnings (P/E)41.0

Beta (1Y)1.13

Revenue Growth-10.19%

EPS Growth100.65%

CountryUS

Employees94,000

SectorIndustrials

Sector Strength72

IndustryConstruction

Share Statistics

EPS (TTM)1.26

Shares Outstanding611,135,700

10 Day Avg. Volume7,098,623

30 Day Avg. Volume5,688,853

Financial Highlights & Ratios

PEG Ratio9.58

Price to Book (P/B)0.00

Price to Sales (P/S)3.04

P/FCF Ratio74.26

Enterprise Value/Market Cap1.17

Enterprise Value/Revenue3.41

Enterprise Value/Gross Profit9.37

Enterprise Value/Ebitda26.06

Forecast

1Y Price Target

$133.22

Price Target Upside17.95% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering11

EPS Forecast (FY)4.6

Revenue Forecast (FY)$24.84B

Johnson Controls Business Overview & Revenue Model

Company DescriptionJohnson Controls International plc, together with its subsidiaries, engages in engineering, manufacturing, commissioning, and retrofitting building products and systems in the United States, Europe, the Asia Pacific, and internationally. It operates in four segments: Building Solutions North America, Building Solutions EMEA/LA, Building Solutions Asia Pacific, and Global Products. The company designs, sells, installs, and services heating, ventilating, air conditioning, controls, building management, refrigeration, integrated electronic security, integrated fire detection and suppression systems, and fire protection and security products for commercial, industrial, retail, small business, institutional, and governmental customers; and provides energy efficiency solutions and technical services, including inspection, scheduled maintenance, and repair and replacement of mechanical and control systems, as well as data-driven smart building solutions to non-residential building and industrial applications. It also offers controls software and software services for residential and commercial applications. Johnson Controls International plc was founded in 1885 and is headquartered in Cork, Ireland.

How the Company Makes MoneyJohnson Controls generates revenue through several key streams. The Building Solutions segment is a significant contributor, as it provides HVAC systems, building automation, security, and fire protection services to commercial, industrial, and residential markets. The Power Solutions segment, which focuses on advanced battery systems for vehicles, also plays a crucial role in the company's earnings. JCI benefits from long-term service contracts and maintenance agreements, ensuring recurring revenue. Additionally, strategic partnerships with technology firms and collaborations with construction companies bolster its market position and expand its reach. The company also emphasizes innovation in energy efficiency and sustainability, aligning with global trends towards greener technologies, which contributes to increased demand and revenue growth.

Johnson Controls Key Performance Indicators (KPIs)

Any

EBITDA by Segment

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.

Chart InsightsJohnson Controls' EBITDA growth in North America and EMEA segments is robust, with significant improvements in 2024, reflecting strong organic sales and margin expansion. The APAC segment faces challenges, aligning with flat orders and tariff impacts mentioned in the earnings call. Despite these regional hurdles, the Global Products segment shows resilience, supported by a record backlog and strategic focus on high-performance solutions. The company's raised full-year guidance underscores confidence in overcoming operational complexities and sustaining financial strength.

Data provided by:

The Fly

Johnson Controls Earnings Call Summary

Earnings Call Date:Nov 05, 2025

(Q4-2025)

% Change Since: |

Next Earnings Date:Feb 04, 2026

Earnings Call Sentiment Positive

Johnson Controls reported strong financial performance with significant growth in revenue, margins, and backlog. The implementation of their proprietary business system is showing promising results. However, there were some challenges in the APAC region, particularly in China, and the company faced impairments related to portfolio actions.

Q4-2025 Updates

Positive Updates

Strong Revenue and Margin Growth

Sales grew 6% for fiscal 2025, with segment margins expanding by 100 basis points and adjusted EPS increasing 17%.

Record Backlog and Free Cash Flow

Orders grew 7% for the year, backlog expanded 13% to a record $15 billion, and free cash flow conversion reached 102%.

Successful Business System Implementation

The proprietary business system is showing early signs of success, with over 700 colleagues engaged in priority areas and significant improvements in sales capacity and factory on-time delivery.

Technological Advancements in Data Centers

Launch of the coolant distribution unit and strategic investment in Accelsius to enhance cooling solutions for AI-driven data centers.

Decarbonization Leadership in Europe

Johnson Controls will provide green heat to Zurich through a major waste incineration project, showcasing its heat pump technology.

Negative Updates

Challenges in APAC Region

Sales declined 3% organically in APAC, primarily due to lower volumes in China.

Amortization and Impairments

The company reported impairments related to portfolio actions and a restructuring charge of $400 million.

Company Guidance

During the Q4 2025 earnings call, Johnson Controls provided guidance for fiscal 2026, highlighting expectations for mid-single-digit organic revenue growth and double-digit adjusted EPS growth. The company anticipates operating leverage of approximately 50%, exceeding their long-term algorithm of 30% or better, largely driven by strategic restructuring and productivity improvements. Marc Vandiepenbeeck, the CFO, emphasized the company's strong free cash flow conversion target of approximately 100%, supported by robust working capital management and disciplined capital allocation. The company’s backlog reached a record $15 billion, growing by 13%, with orders increasing 7% for the year. Key metrics for fiscal 2025 included a 6% growth in sales, a 100 basis-point expansion in segment margins, and a 17% increase in adjusted EPS. The company also successfully achieved a 102% free cash flow conversion rate. As part of its long-term strategy, Johnson Controls is focused on leveraging its proprietary business system to drive operational efficiency, investing in technological innovation, and pursuing selective acquisitions.

Johnson Controls Financial Statement Overview

Summary

Johnson Controls shows strong revenue growth and efficient cost management, with improved gross profit margins. However, increased leverage and challenges in free cash flow generation present areas for improvement.

Income Statement

Positive

Johnson Controls has demonstrated a solid revenue growth trajectory with a TTM (Trailing-Twelve-Months) revenue growth rate of 8.29%. The gross profit margin has improved to 36.41%, indicating efficient cost management. However, the net profit margin slightly decreased to 7.29%, suggesting some pressure on net profitability. The EBIT and EBITDA margins remain stable, reflecting consistent operational performance.

Balance Sheet

Positive

The company's debt-to-equity ratio of 0.72 indicates a moderate level of leverage, which is manageable but has increased compared to previous years. Return on equity has improved to 14.02%, showcasing effective use of equity to generate profits. The equity ratio stands at 34.06%, reflecting a balanced capital structure with a reasonable proportion of equity financing.

Cash Flow

Positive

Operating cash flow has increased, but free cash flow has declined by 17.91% in the TTM period, indicating potential challenges in cash generation. The operating cash flow to net income ratio of 0.26 suggests a moderate conversion of net income into cash. The free cash flow to net income ratio of 0.85 is healthy, showing that a significant portion of earnings is translated into free cash flow.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	23.60B	23.60B	22.95B	22.33B	25.30B	23.67B
Gross Profit	8.59B	8.59B	8.08B	7.82B	8.31B	8.05B
EBITDA	3.09B	3.15B	2.80B	2.10B	2.88B	3.88B
Net Income	1.72B	1.72B	1.71B	1.85B	1.53B	1.64B
Balance Sheet
Total Assets	37.94B	37.94B	42.70B	42.24B	42.16B	41.89B
Cash, Cash Equivalents and Short-Term Investments	379.00M	379.00M	606.00M	828.00M	2.03B	1.34B
Total Debt	9.88B	9.88B	9.49B	8.82B	8.96B	7.74B
Total Liabilities	24.98B	24.98B	25.33B	24.55B	24.76B	23.14B
Stockholders Equity	12.93B	12.93B	16.10B	16.55B	16.27B	17.56B
Cash Flow
Free Cash Flow	965.00M	965.00M	1.60B	1.77B	1.50B	1.94B
Operating Cash Flow	1.40B	1.40B	2.10B	2.22B	1.99B	2.49B
Investing Cash Flow	6.13B	6.13B	-221.00M	-1.18B	-693.00M	-1.09B
Financing Cash Flow	-7.39B	-7.39B	-2.08B	-2.17B	-516.00M	-2.13B

Johnson Controls Technical Analysis

Technical Analysis Sentiment

Neutral

Last Price112.95

Price Trends

50DMA

116.65

Negative

100DMA

112.45

Positive

200DMA

104.54

Positive

Market Momentum

MACD

-1.30

Positive

RSI

42.04

Neutral

STOCH

25.42

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For JCI, the sentiment is Neutral. The current price of 112.95 is below the 20-day moving average (MA) of 117.01, below the 50-day MA of 116.65, and above the 200-day MA of 104.54, indicating a neutral trend. The MACD of -1.30 indicates Positive momentum. The RSI at 42.04 is Neutral, neither overbought nor oversold. The STOCH value of 25.42 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for JCI.

Johnson Controls Risk Analysis

Johnson Controls disclosed 37 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
JCI	70 Outperform	$68.53B	40.95	11.86%	1.27%	-10.19%	100.65%
CSL	70 Outperform	$15.01B	20.32	32.36%	1.28%	0.14%	3.88%
TT	70 Outperform	$85.56B	29.69	37.07%	0.95%	8.58%	20.37%
CARR	66 Neutral	$46.83B	22.31	9.44%	1.65%	-7.93%	-35.00%
LII	64 Neutral	$18.42B	22.17	92.25%	0.96%	3.77%	12.46%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
BLDR	63 Neutral	$13.98B	24.54	13.56%	―	-6.44%	-48.84%

* Industrials Sector Average

Performance Comparison

JCI

Johnson Controls

112.95

33.03

41.33%

BLDR

Builders Firstsource

128.96

-35.16

-21.42%

CSL

Carlisle Companies

366.17

-29.05

-7.35%

Trane Technologies

387.27

1.77

0.46%

LII

Lennox International

522.33

-120.65

-18.76%

CARR

Carrier Global

55.55

-13.42

-19.46%

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.Date of analysis: Nov 06, 2025