AC maker Lennox beats Q2 revenue estimates, raises FY 2025 guidance

Overview

• Lennox, which makes climate-control products, reported a 3% rise in Q2 revenue, beating analyst expectations

• Adjusted EPS for Q2 increases 14% to $7.82, beating consensus

• Company raises FY 2025 guidance, reflecting confidence in growth initiatives

Outlook

• Lennox raises FY 2025 EPS guidance to $23.25-$24.25

• Company expects FY 2025 revenue to grow by 3%

• Lennox anticipates pricing to offset inflationary pressures

• Company projects FY 2025 free cash flow between $650 mln and $800 mln

Result Drivers

• MIX/PRICE BENEFITS - Revenue growth driven by favorable mix and pricing benefits, offsetting inflationary pressures

• SEGMENT PROFIT - Increased segment profit attributed to mix/price benefits, despite softer sales volumes

• HOME COMFORT SOLUTIONS - 3% revenue growth supported by favorable mix and growth initiatives

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "hold" and the breakdown of recommendations is 6 "strong buy" or "buy", 9 "hold" and 6 "sell" or "strong sell"

• The average consensus recommendation for the electrical components & equipment peer group is "buy."

• Wall Street's median 12-month price target for Lennox International Inc is $591.00, about 4.9% below its July 22 closing price of $619.97

• The stock recently traded at 26 times the next 12-month earnings vs. a P/E of 24 three months ago

Press Release: ID:nPnm7ydBa