With a market cap of around $20 billion, Lennox International Inc. (LII) is a global leader in climate control solutions, specializing in heating, ventilation, air conditioning, and refrigeration (HVACR) products. It designs, manufactures, and markets a wide range of high-efficiency HVACR systems under brands such as Lennox, Armstrong Air, Bohn, and Heatcraft.
Companies valued at $10 billion or more are generally classified as “large-cap” stocks, and Lennox International fits this criterion perfectly. Headquartered in Richardson, Texas, Lennox serves residential, commercial, and industrial customers worldwide through direct sales, distributors, and company-owned stores.
Shares of the company are trading 17.2% below its 52-week high of $682.50. Lennox has decreased 7.3% over the past three months, underperforming the broader Dow Jones Industrials Average’s ($DOWI) 1.3% dip over the same time frame.
In the longer term, Lennox stock is down 5.3% over the past six months, lagging behind DOWI’s marginal drop. However, shares of LII have gained 16.7% over the past 52 weeks, outperforming DOWI’s 6.1% return over the same time frame.
Despite the recent downturns, LII has remained mostly above its 50-day and 200-day moving averages since last year.
Despite reporting a better-than-expected Q4 2024 adjusted EPS of $5.60 and revenue of $1.4 billion, LII shares dropped 8.8% on Jan. 29 due to concerns over softer 2025 guidance, with core revenue expected to grow only 2%, reflecting a slowdown after the 2024 refrigerant pre-buy surge. Investors were also concerned about ongoing margin pressures, as Building Climate Solutions’ segment margin declined 160 basis points despite a 17% revenue increase, and factory ramp-up inefficiencies added $20 million in costs.
Nevertheless, Lennox has outpaced its rival, Carrier Global Corporation (CARR), which has surged 10.7% over the past 52 weeks. In addition, Carrier Global has declined 19.9% over the past six months.
Despite LII’s outperformance over the past year, analysts remain cautious about its prospects. The stock has a consensus rating of “Hold” from the 17 analysts covering the stock, and as of writing, it is trading below the mean price target of $635.
