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Swords, Ireland-based Trane Technologies plc (TT) is a global climate innovator that designs, manufactures, sells, and services industrial equipment. With a market cap of $94.3 billion, the company offers central heaters, air conditioners, electric vehicles, air cleaners, and fluid handling products.
Shares of the global climate innovator have outperformed the broader market considerably over the past year. TT has gained 84.1% over this time frame, while the broader S&P 500 Index ($SPX) has rallied nearly 31.8%. In 2024, TT stock is up 70.6%, surpassing the SPX’s 25.8% rise on a YTD basis.
Zooming in further, TT’s outperformance is also apparent compared to the Invesco Building & Construction ETF (PKB). The exchange-traded fund has gained about 57.2% over the past year. Moreover, TT’s returns on a YTD basis outshine the ETF’s 37.7% gains over the same time frame.
TT's success can be credited to the rising demand for its innovative solutions tailored to customer needs, as well as its energy-efficient products and commitment to decarbonization. Government policies in the U.S. and Europe have also played a significant role in driving TT's growth in this market.
On Oct. 30, TT shares closed down more than 3% after reporting its Q3 results. Its revenue stood at $5.4 billion, up 11.4% year over year. The company’s adjusted EPS increased 20.8% year over year to $3.37. TT expects full-year adjusted EPS to be approximately $11.10.
For the current fiscal year, ending in December, analysts expect TT’s EPS to grow 23.2% to $11.14 on a diluted basis. The company’s earnings surprise history is impressive. It beat the consensus estimate in each of the last four quarters.
Among the 19 analysts covering TT stock, the consensus is a “Moderate Buy.” That’s based on six “Strong Buy” ratings, 12 “Holds,” and one “Strong Sell.”
This configuration is more bullish than three months ago, with five analysts suggesting a “Strong Buy.”
On Nov. 24, Wells Fargo & Company (WFC) analyst Joe O’Dea maintained a “Sell” rating on TT with a price target of $390.
While TT currently trades above its mean price target of $415.12, the Street-high price target of $500 suggests an upside potential of 20.2%.
