Modine (MOD) AI Stock Analysis

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Modine

(NYSE:MOD)

Rating:73Outperform

Price Target:―

Modine demonstrates strong financial performance and a positive earnings call outlook, particularly in its Climate Solutions and data center segments. However, the stock's technical indicators suggest caution, and its valuation is relatively high, which may limit upside potential. Continued strategic growth and strong financial management position Modine well, but challenges in certain segments and market conditions should be monitored.

Positive Factors

Data Center Growth

Management expects data center revenue to increase more than 30% organically in fiscal 2026, indicating strong demand in North America.

Earnings

Modine generated $647 million of revenue, surpassing the consensus estimate of $631 million, and reported adjusted EPS of $1.12, exceeding the consensus of $0.96.

Market Position

Modine secured $180 million in orders for the Airedale data center cooling systems from a new colocation customer in the United States.

Negative Factors

Fiscal Outlook

Shares declined due to concerns about the fiscal 2026 outlook.

Performance Tech Segment

The Performance Tech segment has a weak outlook, with commercial and off-highway sectors struggling.

Trucking Cycle

The downturn in the trucking cycle is more severe than when Modine Manufacturing last provided guidance.

Modine (MOD) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$4.76B

Dividend YieldN/A

Average Volume (3M)949.10K

Price to Earnings (P/E)26.6

Beta (1Y)2.24

Revenue Growth4.87%

EPS Growth-29.43%

CountryUS

Employees11,000

SectorConsumer Cyclical

Sector Strength76

IndustryAuto - Parts

Share Statistics

EPS (TTM)1.12

Shares Outstanding52,391,884

10 Day Avg. Volume1,013,062

30 Day Avg. Volume949,101

Financial Highlights & Ratios

PEG Ratio-11.06

Price to Book (P/B)5.98

Price to Sales (P/S)0.00

P/FCF Ratio51.29

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$128.00

Price Target Upside40.97% Upside

Rating ConsensusStrong Buy

Number of Analyst Covering3

Modine Business Overview & Revenue Model

Company DescriptionModine Manufacturing Company provides engineered heat transfer systems and heat transfer components for use in on- and off-highway original equipment manufacturer (OEM) vehicular applications. It operates through Climate Solutions and Performance Technologies segments. The company offers gas-fired, hydronic, electric, and oil-fired unit heaters; indoor and outdoor duct furnaces; infrared units; perimeter heating products, such as commercial fin-tube radiation, cabinet unit heaters, and convectors; roof-mounted direct- and indirect-fired makeup air units; unit ventilators; single packaged vertical units; precision air conditioning units for data center applications; air handler units; fan walls; chillers; ceiling cassettes; hybrid fan coils; and condensers and condensing units. It also provides microchannel, heat recovery, round tube plate fin, and motor and generator cooling coils; evaporator unit, fluid, transformer oil, gas, air blast, and dry and brine coolers, as well as remote condensers; and coatings to protect against corrosion. In addition, the company offers powertrain cooling products, including engine cooling modules, radiators, charge air coolers, condensers, oil coolers, fan shrouds, and surge tanks; on-engine cooling products comprising exhaust gas recirculation, engine oil, fuel, charge air, and intake air coolers; auxiliary cooling products, such as transmission and retarder oil coolers, and power steering coolers; and complete battery thermal management systems and electronics cooling packages. It serves heating, ventilation, and cooling OEMs; construction architects and contractors; wholesalers of heating equipment; automobile, truck, bus, and specialty vehicle OEMs; agricultural, industrial, and construction equipment OEMs; and commercial and industrial equipment OEMs. The company has operations in North America, South America, Europe, and Asia. Modine Manufacturing Company was incorporated in 1916 and is headquartered in Racine, Wisconsin.

How the Company Makes MoneyModine generates revenue through the design, manufacture, and sale of a wide range of thermal management products and solutions. The company's key revenue streams include sales from its vehicular thermal management products to automotive and commercial vehicle manufacturers, HVAC systems for commercial and industrial applications, and heat transfer products for refrigeration and data centers. Modine also benefits from strategic partnerships and long-term supply agreements with major OEMs in the automotive and HVAC industries, which provide stable and recurring income. Additionally, the company's global footprint allows it to capitalize on growth opportunities in emerging markets, contributing to its earnings.

Modine Earnings Call Summary

Earnings Call Date:May 20, 2025

(Q4-2025)

% Change Since: -13.99%|

Next Earnings Date:Jul 30, 2025

Earnings Call Sentiment Positive

Modine's earnings call highlighted strong financial performance with record sales and profitability, driven by growth in the Climate Solutions and Data Center segments. However, the company faces challenges in the Performance Technologies segment and uncertainties related to global trade and tariffs. Despite these challenges, Modine's strategic transformation and cost optimization efforts have resulted in significant margin improvements.

Q4-2025 Updates

Positive Updates

Record-Breaking Sales and Profitability

Modine achieved the highest reported sales and profitability in its history for the third consecutive year. Adjusted EBITDA increased by 25% on a 7% sales increase.

Climate Solutions Segment Growth

Climate Solutions reported a 30% increase in revenues and a 45% increase in adjusted EBITDA, resulting in a 220 basis point improvement in adjusted EBITDA margins to 21%.

Data Center Segment Surge

Data center sales increased by 119% to $644 million, with North American sales as a major driver. The Scott Springfield acquisition contributed $197 million.

Strong Cash Flow and Share Repurchase

Modine generated $129 million of free cash flow for the year, reduced net debt by $92 million, and initiated an $18 million share repurchase as part of a $100 million stock buyback program.

Successful Strategic Transformation

This quarter marked the 13th consecutive quarter of year-over-year margin improvement, with a 300 basis point improvement in adjusted EBITDA margin from the prior year.

Negative Updates

Performance Technologies Market Challenges

The Performance Technologies segment faced challenging market conditions with a projected extended downturn in vehicular markets and delays in electric vehicle program launches.

Uncertainty in Global Trade and Tariffs

Modine is navigating global trade uncertainties and tariffs, which could impact material costs and product demand, particularly in the Performance Technologies segment.

Slowdown in European Data Center Market

Tentativeness in the European data center market is attributed to changing hyperscaler plans, impacting the growth outlook in that region.

Delays in EV System Sales

Advanced Solutions sales were down by 12% due to delays in the launch and ramp-up of electric vehicle programs, leading to lowered expectations for near-term growth.

Company Guidance

During Modine's fourth quarter and fiscal year 2025 earnings call, the company provided robust guidance for the upcoming fiscal year 2026. The Climate Solutions segment, which reported a remarkable 30% increase in revenues and a 45% rise in adjusted EBITDA, is expected to continue its growth trajectory with anticipated sales growth between 12% and 20%. This growth is largely driven by the data center and commercial indoor air quality (IAQ) sectors, with data center revenue projected to climb by over 30%. Meanwhile, the Performance Technologies segment faces challenges due to market downturns, with sales expected to decline by 2% to 12%, yet it aims for improved margins through cost-saving initiatives. Overall, Modine forecasts total company sales to increase by 2% to 10%, alongside an adjusted EBITDA range of $420 million to $450 million for fiscal 2026, reflecting an 11% increase at the midpoint. The company is also focused on executing its strategic plans, including expanding production capacities and pursuing strategic acquisitions and divestitures.

Modine Financial Statement Overview

Summary

Modine's financial performance is robust, with strong profitability and growth metrics. The company shows healthy revenue growth, efficient operations, and solid earnings. The balance sheet indicates moderate leverage with strong equity utilization, and cash flows are impressive with excellent cash conversion and management.

Income Statement

Very Positive

Modine's income statement shows strong profitability and growth. The gross profit margin for TTM (Trailing-Twelve-Months) is 24.2%, and the net profit margin is 6.3%. Revenue growth is robust with a 5.5% increase from the previous annual report. EBIT margin stands at 10.8%, and EBITDA margin at 12.9%, indicating efficient operations and solid earnings before interest and taxes.

Balance Sheet

Positive

The balance sheet reflects a stable financial position with a debt-to-equity ratio of 0.39, indicating moderate leverage. Return on equity (ROE) for TTM is 18.7%, showing efficient use of equity to generate profits. The equity ratio is 46.7%, suggesting a healthy reliance on equity financing relative to total assets.

Cash Flow

Very Positive

Cash flow analysis reveals strong cash generation with a free cash flow growth rate of 21.6%. The operating cash flow to net income ratio is 1.24, indicating robust cash conversion from earnings. Free cash flow to net income ratio is 0.96, demonstrating effective cash management and reinvestment capabilities.

TTM	Mar 2024	Mar 2023	Mar 2022	Mar 2021	Mar 2020
Breakdown
Income Statement		Total Revenue
2.54B	2.41B	2.30B	2.05B	1.81B	1.98B
	Gross Profit
615.00M	525.60M	389.40M	309.30M	293.40M	307.50M
	EBIT
274.10M	240.70M	150.40M	92.10M	80.30M	53.10M
	EBITDA
347.50M	294.80M	208.00M	147.80M	-31.30M	132.60M
	Net Income Common Stockholders
160.20M	161.50M	153.10M	85.20M	-209.50M	-2.00M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
83.80M	60.10M	67.10M	45.20M	37.80M	70.90M
	Total Assets
1.83B	1.85B	1.57B	1.43B	1.28B	1.54B
	Total Debt
370.80M	509.00M	352.70M	377.80M	334.50M	482.40M
	Net Debt
287.00M	448.90M	285.60M	332.60M	296.70M	411.50M
	Total Liabilities
966.60M	1.10B	966.30M	968.90M	920.60M	1.04B
	Stockholders Equity
855.10M	747.60M	599.60M	458.10M	356.10M	493.60M
Cash Flow		Free Cash Flow
97.10M	126.10M	56.80M	-28.80M	117.10M	-13.40M
	Operating Cash Flow
198.10M	214.60M	107.50M	11.50M	149.80M	57.90M
	Investing Cash Flow
-288.00M	-283.40M	-50.40M	-51.00M	-31.30M	-60.50M
	Financing Cash Flow
27.70M	62.70M	-33.30M	39.20M	-145.10M	33.30M

Modine Technical Analysis

Technical Analysis Sentiment

Negative

Last Price90.80

Price Trends

50DMA

86.15

Positive

100DMA

92.96

Negative

200DMA

108.38

Negative

Market Momentum

MACD

1.63

Positive

RSI

48.32

Neutral

STOCH

16.10

Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MOD, the sentiment is Negative. The current price of 90.8 is below the 20-day moving average (MA) of 95.84, above the 50-day MA of 86.15, and below the 200-day MA of 108.38, indicating a neutral trend. The MACD of 1.63 indicates Positive momentum. The RSI at 48.32 is Neutral, neither overbought nor oversold. The STOCH value of 16.10 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for MOD.

Modine Risk Analysis

Modine disclosed 26 risk factors in its most recent earnings report. Modine reported the most risks in the “Ability to Sell” category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Modine Peers Comparison

Overall Rating

UnderperformOutperform

Sector (62)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
VC	81 Outperform	$2.30B	7.91	25.15%	―	-1.35%	-39.06%
BWA	76 Outperform	$7.35B	26.61	5.38%	1.33%	-8.22%	-52.61%
MOD	73 Outperform	$4.76B	26.60	22.20%	―	4.87%	-29.43%
LEA	73 Outperform	$4.83B	10.60	10.00%	3.41%	-3.15%	-6.70%
GT	65 Neutral	$3.27B	13.61	5.06%	―	-5.43%	―
GTX	63 Neutral	$2.15B	8.21	-41.90%	0.57%	-10.26%	―
Sector *	62 Neutral	$6.90B	11.20	2.94%	3.91%	2.68%	-25.01%

* Consumer Cyclical Sector Average

Performance Comparison

MOD

Modine

90.80

-9.04

-9.05%

BWA

BorgWarner

33.09

-2.46

-6.92%

GoodYear Tire

11.41

-1.07

-8.57%

LEA

Lear

90.42

-32.42

-26.39%

Visteon

84.42

-26.92

-24.18%

GTX

Garrett Motion

10.60

1.43

15.59%

Modine Corporate Events

Executive/Board ChangesBusiness Operations and Strategy

Modine Announces Leadership Change in Performance Technologies

Neutral

Feb 27, 2025

On February 26, 2025, Modine announced that Adrian I. Peace will step down from his role as President of Performance Technologies, with his employment ending on September 30, 2025. During the interim, Neil Brinker, the company’s President and CEO, will oversee the segment. Modine plans to search for Peace’s successor while continuing its strategy to enhance the Performance Technologies segment’s growth and profitability. The company aims to achieve adjusted EBITDA margins of 15% to 18% over the next two years, leveraging its 80/20 discipline to maintain its strategic trajectory.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

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.