NYSE:LII

Stock Analysis Report

Executive Summary

Lennox International Inc., through its subsidiaries, provides climate control solutions in North America, Europe, Russia, Turkey, the Middle East, and internationally.

Rewards

Earnings are forecast to grow 9.44% per year

Earnings grew by 12.8% over the past year

Pays a reliable dividend of 1.19%

Risk Analysis

Has a high level of debt



Snowflake Analysis

Proven track record average dividend payer.


Similar Companies

Share Price & News

How has Lennox International's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: LII has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

1.6%

LII

1.3%

US Building

0.8%

US Market


1 Year Return

20.9%

LII

35.9%

US Building

17.8%

US Market

Return vs Industry: LII underperformed the US Building industry which returned 35.9% over the past year.

Return vs Market: LII exceeded the US Market which returned 17.8% over the past year.


Shareholder returns

LIIIndustryMarket
7 Day1.6%1.3%0.8%
30 Day4.1%1.1%1.8%
90 Day10.9%5.4%4.1%
1 Year22.3%20.9%38.1%35.9%20.4%17.8%
3 Year66.8%61.3%28.2%22.4%45.9%36.4%
5 Year189.4%173.3%57.3%37.3%68.1%49.6%

Price Volatility Vs. Market

How volatile is Lennox International's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Lennox International undervalued compared to its fair value and its price relative to the market?

27.45x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: LII ($258.38) is trading above our estimate of fair value ($188.21)

Significantly Below Fair Value: LII is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: LII is poor value based on its PE Ratio (27.4x) compared to the Building industry average (22.1x).

PE vs Market: LII is poor value based on its PE Ratio (27.4x) compared to the US market (18.4x).


Price to Earnings Growth Ratio

PEG Ratio: LII is poor value based on its PEG Ratio (2.9x)


Price to Book Ratio

PB vs Industry: LII has negative assets, so we can't compare its PB Ratio to the US Building industry average.


Next Steps

Future Growth

How is Lennox International forecast to perform in the next 1 to 3 years based on estimates from 18 analysts?

9.4%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: LII's forecast earnings growth (9.4% per year) is above the savings rate (1.7%).

Earnings vs Market: LII's earnings (9.4% per year) are forecast to grow slower than the US market (14.2% per year).

High Growth Earnings: LII's earnings are forecast to grow, but not significantly.

Revenue vs Market: LII's revenue (3.7% per year) is forecast to grow slower than the US market (7.4% per year).

High Growth Revenue: LII's revenue (3.7% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: LII's Return on Equity is forecast to be very high in 3 years time (649%).


Next Steps

Past Performance

How has Lennox International performed over the past 5 years?

14.6%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: LII has high quality earnings.

Growing Profit Margin: LII's current net profit margins (9.8%) are higher than last year (8.3%).


Past Earnings Growth Analysis

Earnings Trend: LII's earnings have grown by 14.6% per year over the past 5 years.

Accelerating Growth: LII's earnings growth over the past year (12.8%) is below its 5-year average (14.6% per year).

Earnings vs Industry: LII earnings growth over the past year (12.8%) exceeded the Building industry -5.5%.


Return on Equity

High ROE: LII's liabilities exceed its assets, so it is difficult to calculate its Return on Equity.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Lennox International's financial position?


Financial Position Analysis

Short Term Liabilities: LII has negative shareholder equity, which is a more serious situation than short term assets not covering short term liabilities.

Long Term Liabilities: LII has negative shareholder equity, which is a more serious situation than short term assets not covering long term liabilities.


Debt to Equity History and Analysis

Debt Level: LII has negative shareholder equity, which is a more serious situation than a high debt level.

Reducing Debt: LII's has negative shareholder equity, so we do not need to check if its debt has reduced over time.

Debt Coverage: LII's debt is well covered by operating cash flow (27.4%).

Interest Coverage: LII's interest payments on its debt are well covered by EBIT (10.1x coverage).


Balance Sheet

Inventory Level: LII has a high level of physical assets or inventory.

Debt Coverage by Assets: LII has negative shareholder equity (liabilities exceed assets) therefore debt is not covered by short term assets.


Next Steps

Dividend

What is Lennox International's current dividend yield, its reliability and sustainability?

1.19%

Current Dividend Yield


Dividend Yield vs Market

company1.2%marketbottom25%1.4%markettop25%3.7%industryaverage1.7%forecastin3Years1.2%

Current dividend yield vs market & industry

Notable Dividend: LII's dividend (1.19%) isn’t notable compared to the bottom 25% of dividend payers in the US market (1.43%).

High Dividend: LII's dividend (1.19%) is low compared to the top 25% of dividend payers in the US market (3.72%).


Stability and Growth of Payments

Stable Dividend: LII's dividends per share have been stable in the past 10 years.

Growing Dividend: LII's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (30%), LII's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: LII's dividends in 3 years are forecast to be well covered by earnings (25.9% payout ratio).


Next Steps

Management

What is the CEO of Lennox International's salary, the management and board of directors tenure and is there insider trading?

11.2yrs

Average management tenure


CEO

Todd Bluedorn (55yo)

12.7yrs

Tenure

US$7,541,297

Compensation

Mr. Todd M. Bluedorn has been the Chief Executive Officer of Lennox International, Inc. since April 2, 2007 and has been its Chairman since May 10, 2012. Mr. Bluedorn serves as a Vice President of The Air- ...


CEO Compensation Analysis

Compensation vs Market: Todd's total compensation ($USD7.54M) is below average for companies of similar size in the US market ($USD10.94M).

Compensation vs Earnings: Todd's compensation has been consistent with company performance over the past year.


Management Age and Tenure

11.2yrs

Average Tenure

54yo

Average Age

Experienced Management: LII's management team is seasoned and experienced (11.2 years average tenure).


Board Age and Tenure

8.3yrs

Average Tenure

58yo

Average Age

Experienced Board: LII's board of directors are considered experienced (8.3 years average tenure).


Insider Trading

Insider Buying: LII insiders have only sold shares in the past 3 months.


Recent Insider Transactions

SellUS$193,38127 Nov 19
Janet Katherine Cooper
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares750
Max PriceUS$257.84
SellUS$250,00013 Nov 19
John Major
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares1,000
Max PriceUS$250.00
SellUS$128,25526 Aug 19
Paul Schmidt
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares500
Max PriceUS$256.51
SellUS$257,82521 Aug 19
John Major
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares1,000
Max PriceUS$257.85
SellUS$829,61520 May 19
Prakash Bedapudi
EntityIndividual
Role
Chief Technology Officer
Executive VP & CTO
Shares2,995
Max PriceUS$277.00
SellUS$446,53526 Feb 19
Prakash Bedapudi
EntityIndividual
Role
Chief Technology Officer
Executive VP & CTO
Shares1,786
Max PriceUS$250.05

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Management Team

  • Rick Pelini (60yo)

    VP & Treasurer

    • Tenure: 10.8yrs
  • Steve Harrison

    Vice President of Investor Relations

    • Tenure: 11.5yrs
  • Todd Bluedorn (55yo)

    Chairman & CEO

    • Tenure: 12.7yrs
    • Compensation: US$7.54m
  • John Torres (60yo)

    Executive VP

    • Tenure: 11yrs
    • Compensation: US$2.01m
  • Daniel Sessa (54yo)

    Executive VP & Chief HR Officer

    • Tenure: 12.5yrs
    • Compensation: US$1.90m
  • Chris Kosel (52yo)

    VP, Chief Accounting Officer & Controller

    • Tenure: 2.6yrs
  • Doug Young (56yo)

    Executive VP and President & COO of LII Residential Heating & Cooling

    • Tenure: 13.2yrs
    • Compensation: US$2.20m
  • Prakash Bedapudi (52yo)

    Executive VP & CTO

    • Tenure: 11.4yrs
  • Joe Reitmeier (54yo)

    Executive VP & CFO

    • Tenure: 7.4yrs
    • Compensation: US$2.15m
  • Gary Bedard (54yo)

    Executive VP and President & COO of Worldwide Refrigeration Business Segment

    • Tenure: 2.2yrs

Board Members

  • Greg Swienton (69yo)

    Independent Director

    • Tenure: 9yrs
    • Compensation: US$239.60k
  • Todd Teske (54yo)

    Lead Director

    • Tenure: 4.6yrs
    • Compensation: US$259.60k
  • John Norris (61yo)

    Independent Director

    • Tenure: 18.9yrs
    • Compensation: US$229.60k
  • John Major (73yo)

    Independent Director

    • Tenure: 26.9yrs
    • Compensation: US$234.60k
  • Janet Katherine Cooper (65yo)

    Independent Director

    • Tenure: 20.7yrs
    • Compensation: US$219.60k
  • Paul Schmidt (74yo)

    Independent Director

    • Tenure: 14.9yrs
    • Compensation: US$219.60k
  • Todd Bluedorn (55yo)

    Chairman & CEO

    • Tenure: 12.7yrs
    • Compensation: US$7.54m
  • Max Mitchell (55yo)

    Independent Director

    • Tenure: 3.3yrs
    • Compensation: US$219.60k
  • Kim Rucker (52yo)

    Independent Director

    • Tenure: 4.5yrs
    • Compensation: US$219.60k
  • Karen Quintos (55yo)

    Independent Director

    • Tenure: 5.3yrs
    • Compensation: US$219.60k

Company Information

Lennox International Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Lennox International Inc.
  • Ticker: LII
  • Exchange: NYSE
  • Founded: 1895
  • Industry: Building Products
  • Sector: Capital Goods
  • Market Cap: US$9.948b
  • Shares outstanding: 38.53m
  • Website: https://www.lennoxinternational.com

Number of Employees


Location

  • Lennox International Inc.
  • 2140 Lake Park Boulevard
  • Richardson
  • Texas
  • 75080
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
LIINYSE (New York Stock Exchange)YesCommon StockUSUSDJul 1999
LXIDB (Deutsche Boerse AG)YesCommon StockDEEURJul 1999
LII *BMV (Bolsa Mexicana de Valores)YesCommon StockMXMXNJul 1999

Biography

Lennox International Inc., through its subsidiaries, provides climate control solutions in North America, Europe, Russia, Turkey, the Middle East, and internationally. It designs, manufactures, and markets ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/12/11 23:39
End of Day Share Price2019/12/11 00:00
Earnings2019/09/30
Annual Earnings2018/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.