NYSE:LII

Stock Analysis Report

Executive Summary

Lennox International Inc., through its subsidiaries, designs, manufactures, and markets a range of products for the heating, ventilation, air conditioning, and refrigeration markets in the United States, Canada, and Europe.


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

-2.0%

LII

-8.4%

US Building

-7.6%

US Market


1 Year Return

-0.7%

LII

15.5%

US Building

10.2%

US Market

Return vs Industry: LII underperformed the US Building industry which returned 15.5% over the past year.

Return vs Market: LII underperformed the US Market which returned 10.5% over the past year.


Shareholder returns

LIIIndustryMarket
7 Day-2.0%-8.4%-7.6%
30 Day1.5%-5.3%-4.5%
90 Day-4.8%-3.4%-0.6%
1 Year0.5%-0.7%17.3%15.5%12.5%10.2%
3 Year50.7%45.6%15.2%10.0%37.1%28.3%
5 Year140.3%126.9%38.8%21.0%60.8%43.2%

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?

23.24x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: LII ($246.03) is trading above our estimate of fair value ($233.28)

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 (23.5x) compared to the Building industry average (21.6x).

PE vs Market: LII is poor value based on its PE Ratio (23.5x) compared to the US market (17.2x).


Price to Earnings Growth Ratio

PEG Ratio: LII is poor value based on its PEG Ratio (3.1x)


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 17 analysts?

7.7%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: LII's forecast earnings growth (7.7% per year) is above the savings rate (1.7%).

Earnings vs Market: LII's earnings (7.7% per year) are forecast to grow slower than the US market (13.2% per year).

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

Revenue vs Market: LII's revenue (3.2% per year) is forecast to grow slower than the US market (7.6% per year).

High Growth Revenue: LII's revenue (3.2% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: Insufficient data to determine if LII's Return on Equity is forecast to be high in 3 years time


Next Steps

Past Performance

How has Lennox International performed over the past 5 years?

14.9%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: LII has high quality earnings.

Growing Profit Margin: LII's current net profit margins (10.7%) are higher than last year (9.3%).


Past Earnings Growth Analysis

Earnings Trend: LII's earnings have grown by 14.9% per year over the past 5 years.

Accelerating Growth: LII's earnings growth over the past year (13.5%) is below its 5-year average (14.9% per year).

Earnings vs Industry: LII earnings growth over the past year (13.5%) exceeded the Building industry -15.8%.


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 (34.8%).

Interest Coverage: LII's interest payments on its debt are well covered by EBIT (10.3x 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?

1.26%

Current Dividend Yield


Dividend Yield vs Market

company1.3%marketbottom25%1.5%markettop25%4.0%industryaverage1.8%forecastin3Years1.3%

Current dividend yield vs market & industry

Notable Dividend: LII's dividend (1.25%) isn’t notable compared to the bottom 25% of dividend payers in the US market (1.52%).

High Dividend: LII's dividend (1.25%) is low compared to the top 25% of dividend payers in the US market (3.9%).


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 (28.1%), 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 (24.1% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

11.4yrs

Average management tenure


CEO

Todd Bluedorn (55yo)

12.8yrs

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 ($USD7.54M) is about average for companies of similar size in the US market ($USD6.41M).

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


Leadership Team

NamePositionTenureCompensationOwnership
Todd Bluedorn
Chairman & CEO12.8yrsUS$7.54m0.24% $22.8m
Joseph Reitmeier
Executive VP & CFO7.6yrsUS$2.15m0.037% $3.5m
John Torres
Executive VP11.2yrsUS$2.01m0.018% $1.7m
Daniel Sessa
Executive VP & Chief HR Officer12.7yrsUS$1.90m0.11% $10.8m
Douglas Young
Executive VP13.3yrsUS$2.20m0.16% $14.9m
Chris Kosel
VP, Chief Accounting Officer & Controller2.8yrsno data0.0031% $286.8k
Prakash Bedapudi
Executive VP & CTO11.6yrsno data0.040% $3.8m
Steve Harrison
Vice President of Investor Relations11.7yrsno datano data
Gary Bedard
Executive VP2.3yrsno data0.046% $4.3m
Elliot Zimmer
Executive VP0.3yrsno data0.0040% $373.3k

11.4yrs

Average Tenure

54yo

Average Age

Experienced Management: LII's management team is seasoned and experienced (11.4 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Todd Bluedorn
Chairman & CEO12.8yrsUS$7.54m0.24% $22.8m
Gregory Swienton
Independent Director9.2yrsUS$239.60k0.031% $3.0m
Todd Teske
Lead Director4.8yrsUS$259.60k0.029% $2.7m
John Norris
Independent Director19.1yrsUS$229.60k0.90% $84.7m
John Major
Independent Director27.1yrsUS$234.60k0.040% $3.8m
Janet Katherine Cooper
Independent Director20.8yrsUS$219.60k0.054% $5.1m
Paul Schmidt
Independent Director15.1yrsUS$219.60k0.025% $2.3m
Max Mitchell
Independent Director3.4yrsUS$219.60k0.0085% $799.4k
Kim Rucker
Independent Director4.7yrsUS$219.60k0.0096% $905.6k
Karen Quintos
Independent Director5.4yrsUS$219.60k0.018% $1.7m

8.5yrs

Average Tenure

58yo

Average Age

Experienced Board: LII's board of directors are considered experienced (8.5 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

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


Recent Insider Transactions

Ownership Breakdown

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


Top Shareholders

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$9.404b
  • Shares outstanding: 38.60m
  • 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, designs, manufactures, and markets a range of products for the heating, ventilation, air conditioning, and refrigeration markets in the United States, Canada, and Europe. The company operates in three segments: Residential Heating & Cooling, Commercial Heating & Cooling, and Refrigeration. The Residential Heating & Cooling segment provides furnaces, air conditioners, heat pumps, packaged heating and cooling systems, indoor air quality equipment and accessories, comfort control products, and replacement parts and supplies for residential replacement and new construction markets. The Commercial Heating & Cooling segment offers unitary heating and air conditioning equipment, applied systems, controls, installation and service of commercial heating and cooling equipment, and variable refrigerant flow commercial products for light commercial markets, as well as rooftop units, split system/air handler combinations, and variable refrigerant flow commercial products. The Refrigeration segment offers condensing units, unit coolers, fluid coolers, air cooled condensers, air handlers, and refrigeration rack systems that helps in preserving food and other perishables in supermarkets, convenience stores, restaurants, warehouses, and distribution centers, as well as for data centers, machine tooling, and other cooling applications; and compressor racks and industrial process chillers. The company sells its products and services through direct sales, distributors, and company-owned parts and supplies stores. Lennox International Inc. was founded in 1895 and is headquartered in Richardson, Texas. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/02/27 00:58
End of Day Share Price2020/02/26 00:00
Earnings2019/12/31
Annual Earnings2019/12/31


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.