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Lennox International
(NYSE:LII)
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Rating:66Neutral
Price Target:
$359.00
▼(-8.82% Downside)
Action:Reiterated
Date:10/29/26
The score is supported primarily by strong profitability and robust free-cash-flow generation, with a reasonable valuation. It is held back by a clearly bearish technical setup (price well below key moving averages) and a mixed earnings-call outlook that included reduced 2026 revenue/EPS/FCF guidance and expected margin pressure, despite strength in the commercial-focused segment and management’s recovery plan.
Positive Factors
Profitability
Sustained gross and net margins indicate Lennox has meaningful earnings power across its HVAC and refrigeration portfolio. Consistent profitability provides resources for product investment, channel support, productivity initiatives, and shareholder returns while strengthening resilience through industry cycles.
Negative Factors
Guidance Reduction
Lower revenue and free-cash-flow guidance signals that Lennox’s near-term earnings trajectory is less robust than previously expected. Reduced price and mix benefits, declining volume, and lower cash generation could constrain investment capacity and weaken operating leverage over the next several quarters.
Read all positive and negative factors
Positive Factors
Negative Factors
Profitability
Sustained gross and net margins indicate Lennox has meaningful earnings power across its HVAC and refrigeration portfolio. Consistent profitability provides resources for product investment, channel support, productivity initiatives, and shareholder returns while strengthening resilience through industry cycles.
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
$11.50B
Dividend Yield1.6%
Average Volume (3M)535.73K
Price to Earnings (P/E)15.4
Beta (1Y)0.88
Revenue Growth1.92%
EPS Growth-9.14%
CountryUS
Employees5,400
SectorIndustrials
Sector Strength72
IndustryIndustrial - Machinery
Share Statistics
EPS (TTM)21.63
Shares Outstanding34,560,677
10 Day Avg. Volume665,732
30 Day Avg. Volume535,733
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 Cap1.24
Enterprise Value/Revenue2.62
Enterprise Value/Gross Profit8.04
Enterprise Value/Ebitda12.40
Forecast
1Y Price Target
$381.78Price Target Upside-3.03% Downside
Rating ConsensusHold
Number of Analyst Covering11
EPS Forecast (FY)23.03
Revenue Forecast (FY)$5.56B
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 primarily makes money by selling HVAC and refrigeration equipment, replacement parts, and related services through multiple go-to-market channels and end markets.
1) Core equipment sales (largest driver): Revenue is generated from the sale...
Lennox International Earnings Call Summary
Earnings Call Date:Oct 28, 2026
(Q3-2026)
| % Change Since: |
Next Earnings Date:Feb 02, 2027
Earnings Call Sentiment Neutral
The call had a mixed sentiment. Revenue growth, strong Building Climate Solutions performance, acquisition contributions, cash flow generation, inventory-unit reductions, and multiple growth and productivity initiatives were positive. However, these positives were offset by lower segment profit and adjusted EPS, residential demand constraints, tariff and inflation pressure, limited price realization, margin contraction, and reductions to full-year revenue, earnings, and free cash flow guidance. Management remained confident in the long-term strategy but acknowledged meaningful near-term challenges.Positive Updates
Third-Quarter Revenue Growth
Third-quarter revenue grew 10.2% to $1.6 billion, driven by continued outperformance in Building Climate Solutions, contributions from acquisitions, and improving residential sales volumes.
Negative Updates
Declining Profitability and Adjusted EPS
Total segment profit declined approximately 2% to $323 million, while adjusted earnings per share declined 7% to $6.84. Management said profitability fell short of expectations.
Read all updates
Q3-2026 Updates
Positive
Negative
Third-Quarter Revenue Growth
Third-quarter revenue grew 10.2% to $1.6 billion, driven by continued outperformance in Building Climate Solutions, contributions from acquisitions, and improving residential sales volumes.
Read all positive updates
Company Guidance
For 2026, Lennox updated adjusted EPS guidance to $21 to $21.50, revenue growth to approximately 6% compared with 8% previously, price and mix growth to low single digit growth compared with mid single digit growth previously, and overall volume to a low single digit decline; BCS revenue growth is expected to be approximately 23%, up from 20%, while HCS revenue is expected to decline approximately 4% compared with the prior expectation for 1% growth, and free cash flow guidance was reduced to $700 million to $750 million from $750 million to $850 million. The expected tax rate is 21% compared with 20% in prior guidance, capital expenditures are expected to be approximately $225 million, fourth-quarter organic total sales are expected to decline mid single digit, full-year 1-step sales are expected to be down low double digits and 2-step sales up low single digits, enterprise margins are expected to decline about 200 basis points, BCS full-year margins are expected to be approximately flat, and HCS margins are expected to contract about 50 basis points. Lennox is not providing 2027 guidance today, but expects successful execution of its recovery plan to drive sales EBIT and EPS growth in 2027, with higher sales, higher EPS, and higher EBIT dollars, while the first half of 27 will be more challenging, industry volumes will be muted, and the company is aiming for price increases of more than the traditional 1-2.Lennox International Financial Statement Overview
Summary
Income Statement
82
Very Positive
Balance Sheet
64
Positive
Cash Flow
76
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 5.45B | 5.20B | 5.34B | 4.98B | 4.72B | 4.19B |
| Gross Profit | 1.78B | 1.73B | 1.77B | 1.55B | 1.28B | 1.19B |
| EBITDA | 1.15B | 1.15B | 1.13B | 879.50M | 733.50M | 658.50M |
| Net Income | 749.90M | 805.80M | 806.90M | 590.10M | 497.10M | 464.00M |
Balance Sheet | ||||||
| Total Assets | 4.69B | 4.08B | 3.47B | 2.80B | 2.57B | 2.17B |
| Cash, Cash Equivalents and Short-Term Investments | 45.50M | 34.70M | 422.30M | 69.10M | 61.10M | 36.50M |
| Total Debt | 2.08B | 2.06B | 1.49B | 1.53B | 1.75B | 1.44B |
| Total Liabilities | 3.37B | 2.92B | 2.62B | 2.51B | 2.77B | 2.44B |
| Stockholders Equity | 1.32B | 1.16B | 850.20M | 285.30M | -203.10M | -269.00M |
Cash Flow | ||||||
| Free Cash Flow | 835.70M | 638.80M | 782.10M | 486.00M | 201.20M | 408.70M |
| Operating Cash Flow | 989.30M | 757.60M | 945.70M | 736.20M | 302.30M | 515.50M |
| Investing Cash Flow | -902.10M | -655.60M | -174.40M | -319.70M | -103.00M | -106.40M |
| Financing Cash Flow | -71.90M | -465.70M | -418.60M | -406.20M | -174.10M | -498.70M |
Lennox International Technical Analysis
Negative
393.72
Price Trends
370.12
Negative
437.91
Negative
471.02
Negative
Market Momentum
-3.63
Negative
34.27
Neutral
46.40
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LII, the sentiment is Negative. The current price of 393.72 is above the 20-day moving average (MA) of 360.14, above the 50-day MA of 370.12, and below the 200-day MA of 471.02, indicating a bearish trend. The MACD of -3.63 indicates Negative momentum. The RSI at 34.27 is Neutral, neither overbought nor oversold. The STOCH value of 46.40 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for LII.
Lennox International Risk Analysis
Lennox International disclosed 20 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 |
|---|---|---|---|---|---|---|---|
76 Outperform | $93.55B | 36.54 | 12.69% | 1.32% | 4.82% | -1.66% | |
71 Outperform | $98.67B | 33.72 | 34.49% | 0.91% | 7.04% | 4.58% | |
66 Neutral | $11.50B | 15.38 | 60.10% | 1.60% | 1.92% | -9.14% | |
65 Neutral | $7.64B | 53.76 | 12.64% | ― | 29.47% | -23.92% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
61 Neutral | $46.38B | 38.72 | 8.89% | 1.71% | -1.58% | -43.59% | |
53 Neutral | $6.23B | 38.97 | 17.21% | 0.53% | 53.53% | 29.55% |
* Industrials Sector Average
LII
Lennox International
332.64
-157.26
-32.10%
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TT
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448.47
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1.42%
MOD
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143.54
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CARR
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-3.28%
Lennox International Corporate Events
Business Operations and StrategyExecutive/Board Changes
Lennox International Updates Executive Long-Term Incentive Plan
Neutral
Sep 18, 2026
On September 16, 2026, Lennox International Inc. updated its executive compensation structure by adopting a new form of Long-Term Incentive Award Agreement for U.S. employees at the vice president level and above under its 2019 Equity and Incentiv...
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.