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Lennox International
(NYSE:LII)
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Rating:67Neutral
Price Target:
$599.00
â–²(22.97% Upside)
Action:Downgraded
Date:05/29/26
The score is driven primarily by strong margins and free-cash-flow generation, tempered by balance-sheet leverage risk. The latest earnings call adds moderate support via raised revenue outlook and maintained EPS/FCF targets, but ongoing HCS volume pressure and rising tariff/input costs remain key headwinds. Technically, signals are neutral-to-soft, and valuation is relatively expensive with only a modest dividend yield.
Positive Factors
Strong margins and profitability
Sustainably high gross and net margins reflect durable product differentiation, pricing power, and scale in manufacturing and aftermarket parts. These margins support reinvestment, R&D, and working-capital cushions, allowing the company to sustain returns through cyclical HVAC demand swings.
Negative Factors
High leverage vs equity base
Material leverage amplifies returns but restricts financial flexibility in a cyclical construction-linked industry. Elevated debt relative to a modest equity base raises refinancing and interest-rate vulnerability, and limits the firm’s ability to absorb prolonged volume declines or fund opportunistic investments without higher risk.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong margins and profitability
Sustainably high gross and net margins reflect durable product differentiation, pricing power, and scale in manufacturing and aftermarket parts. These margins support reinvestment, R&D, and working-capital cushions, allowing the company to sustain returns through cyclical HVAC demand swings.
Read all positive factors
Lennox International Key Performance Indicators (KPIs)
Any
Revenue by Geography
Shows how much revenue comes from different countries or regions, helping assess diversification and vulnerability to local downturns or supply disruptions. For Lennox, a heavy U.S. concentration means domestic housing and commercial markets heavily influence results, while international trends indicate longer-term growth opportunities or risks.
Shows how much revenue comes from different countries or regions, helping assess diversification and vulnerability to local downturns or supply disruptions. For Lennox, a heavy U.S. concentration means domestic housing and commercial markets heavily influence results, while international trends indicate longer-term growth opportunities or risks.
Data provided by:
The Fly
The FlyLennox International (LII) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$18.70B
Dividend Yield0.96%
Average Volume (3M)385.92K
Price to Earnings (P/E)24.9
Beta (1Y)0.92
Revenue Growth-2.03%
EPS Growth-1.09%
CountryUS
Employees5,400
SectorIndustrials
Sector Strength72
IndustryConstruction
Share Statistics
EPS (TTM)22.29
Shares Outstanding34,799,970
10 Day Avg. Volume471,240
30 Day Avg. Volume385,920
Financial Highlights & Ratios
PEG Ratio-13.71
Price to Book (P/B)14.57
Price to Sales (P/S)3.26
P/FCF Ratio26.53
Enterprise Value/Market Cap1.06
Enterprise Value/Revenue3.78
Enterprise Value/Gross Profit11.43
Enterprise Value/Ebitda17.12
Forecast
1Y Price Target
$560.38Price Target Upside15.04% Upside
Rating ConsensusHold
Number of Analyst Covering10
EPS Forecast (FY)24.39
Revenue Forecast (FY)$5.62B
Lennox International Business Overview & Revenue Model
Company Description
Lennox International Inc. is a global manufacturer and distributor specializing in heating, ventilation, air conditioning (HVAC), and refrigeration solutions. The company operates across three divisions: Residential Heating & Cooling, Commercial H...
How the Company Makes Money
Lennox International makes money primarily by selling HVAC equipment and related components, plus associated services and aftermarket parts. Its largest revenue stream is typically equipment sales, where it manufactures and sells furnaces, air con...
Lennox International Earnings Call Summary
Earnings Call Date:Apr 29, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Jul 29, 2026
Earnings Call Sentiment Neutral
The call balanced clear, tangible positives — return to company-wide revenue growth, an exceptionally strong and profitable quarter for Building Climate Solutions, successful product launches, on-track M&A integration, and maintained full-year adjusted EPS guidance — against persistent and meaningful near-term headwinds in Home Comfort Solutions, factory under-absorption pressures, and rising input costs and tariffs. Management emphasized mitigation actions (pricing, productivity, supply-chain moves) and expects much of the cost and price realization to fall in the second half, signaling cautious confidence but acknowledging ongoing uncertainty.Positive Updates
Return to Year-over-Year Revenue Growth
Revenue of $1.1 billion, up 6% year-over-year in Q1; management also increased full-year revenue guidance to approximately 8% (from 6%-7%).
Negative Updates
Home Comfort Solutions (HCS) Revenue Decline
HCS revenue declined 10% overall; organic revenue down ~12% (one-step down ~10%, two-step down ~5%); organic sales volumes declined 21% (improved from a 32% decline in 2025), with continued weakness in new home construction.
Read all updates
Q1-2026 Updates
Positive
Negative
Return to Year-over-Year Revenue Growth
Revenue of $1.1 billion, up 6% year-over-year in Q1; management also increased full-year revenue guidance to approximately 8% (from 6%-7%).
Read all positive updates
Company Guidance
Lennox reaffirmed full‑year adjusted EPS of $23.50–$25.00 while raising revenue guidance to about 8% (from 6–7%), with HCS revenue now expected to grow ~4% (vs. prior 2%) and BCS ~16%; management still expects organic volumes to decline low single digits (net of roughly 1 point of growth from parts & accessories, commercial emergency replacement, ducted heat pumps and Samsung ductless), cost inflation is now pegged at ~5% (vs. 2% prior), pricing is assumed to be mid‑single‑digit with roughly 90% drop‑through, FIFO accounting delays tariff income‑statement effects until Q3, free cash flow is targeted at $750–$850M, capital expenditures are expected to be ~ $250M, and inventory normalization/absorption headwinds should largely resolve by the end of Q2.Lennox International Financial Statement Overview
Summary
Income Statement
86
Very Positive
Balance Sheet
62
Positive
Cash Flow
81
Very Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 5.26B | 5.20B | 5.34B | 4.98B | 4.72B | 4.19B |
| Gross Profit | 1.74B | 1.72B | 1.77B | 1.55B | 1.28B | 1.19B |
| EBITDA | 1.16B | 1.12B | 1.13B | 879.50M | 733.50M | 658.50M |
| Net Income | 783.10M | 786.20M | 806.90M | 590.10M | 497.10M | 464.00M |
Balance Sheet | ||||||
| Total Assets | 4.29B | 4.08B | 3.47B | 2.80B | 2.57B | 2.17B |
| Cash, Cash Equivalents and Short-Term Investments | 50.20M | 34.70M | 422.30M | 69.10M | 61.10M | 36.50M |
| Total Debt | 1.95B | 2.06B | 1.49B | 1.53B | 1.75B | 1.44B |
| Total Liabilities | 3.08B | 2.92B | 2.62B | 2.51B | 2.77B | 2.44B |
| Stockholders Equity | 1.21B | 1.16B | 850.20M | 285.30M | -203.10M | -269.00M |
Cash Flow | ||||||
| Free Cash Flow | 660.70M | 638.80M | 782.10M | 486.00M | 201.20M | 408.70M |
| Operating Cash Flow | 809.50M | 757.60M | 945.70M | 736.20M | 302.30M | 515.50M |
| Investing Cash Flow | -688.70M | -655.60M | -174.40M | -319.70M | -103.00M | -106.40M |
| Financing Cash Flow | -267.40M | -465.70M | -418.60M | -406.20M | -174.10M | -498.70M |
Lennox International Technical Analysis
Positive
487.11
Price Trends
523.32
Positive
511.25
Positive
507.73
Positive
Market Momentum
10.39
Positive
55.10
Neutral
19.27
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LII, the sentiment is Positive. The current price of 487.11 is below the 20-day moving average (MA) of 544.79, below the 50-day MA of 523.32, and below the 200-day MA of 507.73, indicating a bullish trend. The MACD of 10.39 indicates Positive momentum. The RSI at 55.10 is Neutral, neither overbought nor oversold. The STOCH value of 19.27 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for LII.
Lennox International Risk Analysis
Lennox International disclosed 40 risk factors in its most recent earnings report. Lennox International reported the most risks in the "Tech & Innovation" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Lennox International Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | $104.34B | 36.87 | 34.71% | 0.95% | 6.36% | 7.42% | |
71 Outperform | $85.74B | 25.68 | 25.46% | 1.27% | -0.60% | 49.11% | |
69 Neutral | $56.32B | 44.93 | 9.28% | 1.65% | -5.07% | -65.16% | |
67 Neutral | $18.70B | 24.87 | 72.05% | 0.96% | -2.03% | -1.09% | |
67 Neutral | $15.46B | 19.38 | -566.50% | 1.94% | -0.31% | 10.03% | |
65 Neutral | $11.29B | -21.47 | -12.50% | 2.43% | -12.20% | -333.77% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% |
* Industrials Sector Average
LII
Lennox International
552.03
-56.82
-9.33%
TT
Trane Technologies
479.70
44.57
10.24%
JCI
Johnson Controls
142.81
37.91
36.14%
MAS
Masco
77.84
13.14
20.31%
OC
Owens Corning
143.35
2.53
1.80%
CARR
Carrier Global
69.34
-6.16
-8.16%
Lennox International Corporate Events
Executive/Board ChangesShareholder Meetings
Lennox International Announces Board Resignation and Governance Updates
Positive
May 28, 2026
On May 23, 2026, Lennox International director Sivasankaran Somasundaram resigned from the company’s Board, citing other professional responsibilities, with the Board reducing its size from nine to eight members and clarifying there was no d...
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.