Lennox International Inc. (LII), headquartered in Richardson, Texas, designs, manufactures, and markets products for the heating, ventilation, air conditioning, and refrigeration markets. Valued at $18.6 billion by market cap, the company sells its products and services through direct sales, distributors, and company-owned parts and supplies stores.
Shares of this leader in energy-efficient climate-control solutions have underperformed the broader market over the past year. LII has declined 9.5% over this time frame, while the broader S&P 500 Index ($SPX) has rallied nearly 14%. However, in 2026, LII’s stock is up 9.1%, surpassing the SPX’s 1.3% rise on a YTD basis.
Narrowing the focus, LII’s underperformance is also apparent compared to the Industrial Select Sector SPDR Fund (XLI). The exchange-traded fund has gained about 25.7% over the past year. Moreover, the ETF’s 11.6% gains on a YTD basis outshine the stock’s high single-digit returns over the same time frame.
LII is facing headwinds due to channel destocking and weak demand in residential construction.
On Jan. 28, LII shares closed down more than 2% after reporting its Q4 results. Its adjusted EPS of $4.45 fell short of Wall Street expectations of $4.76. The company’s revenue was $1.2 billion, missing Wall Street forecasts of $1.3 billion. LII expects full-year adjusted EPS in the range of $23.50 to $25.
For the current fiscal year, ending in December, analysts expect LII’s EPS to grow 4.2% to $24.12 on a diluted basis. The company’s earnings surprise history is mixed. It beat the consensus estimate in three of the last four quarters while missing the forecast on another occasion.
Among the 19 analysts covering LII stock, the consensus is a “Moderate Buy.” That’s based on six “Strong Buy” ratings, 11 “Holds,” one “Moderate Sell,” and one “Strong Sell.”
This configuration is more bullish than three months ago, with an overall “Hold” rating, consisting two analysts suggesting a “Strong Sell.”
On Feb. 1, Morgan Stanley (MS) kept an “Underweight” rating on LII and lowered the price target to $450.
The mean price target of $552.07 represents a 4.2% premium to LII’s current price levels. The Street-high price target of $667 suggests an upside potential of 25.9%.
On the date of publication, Neha Panjwani did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. This article was originally published on Barchart.com
