LENNOX INTERNATIONAL INC (LII)
US5261071071 - Common Stock
LII gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 39 industry peers in the Building Products industry. LII has an excellent profitability rating, but there are some minor concerns on its financial health. LII is quite expensive at the moment. It does show a decent growth rate.
1. Profitability
1.1 Basic Checks
LII had positive earnings in the past year.
In the past year LII had a positive cash flow from operations.
LII had positive earnings in each of the past 5 years.
Each year in the past 5 years LII had a positive operating cash flow.
1.2 Ratios
LII's Return On Assets of 22.75% is amongst the best of the industry. LII outperforms 100.00% of its industry peers.
LII has a Return On Equity of 99.96%. This is amongst the best in the industry. LII outperforms 100.00% of its industry peers.
With an excellent Return On Invested Capital value of 39.11%, LII belongs to the best of the industry, outperforming 100.00% of the companies in the same industry.
LII had an Average Return On Invested Capital over the past 3 years of 40.80%. This is significantly above the industry average of 13.33%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 22.75% | ||
| ROE | 99.96% | ||
| ROIC | 39.11% |
ROA(3y)20.6%
ROA(5y)19.89%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)40.8%
ROIC(5y)37.97%
1.3 Margins
LII has a better Profit Margin (14.63%) than 82.05% of its industry peers.
In the last couple of years the Profit Margin of LII has grown nicely.
LII has a better Operating Margin (18.87%) than 71.79% of its industry peers.
In the last couple of years the Operating Margin of LII has grown nicely.
With a Gross Margin value of 32.45%, LII perfoms like the industry average, outperforming 43.59% of the companies in the same industry.
LII's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 18.87% | ||
| PM (TTM) | 14.63% | ||
| GM | 32.45% |
OM growth 3Y6.44%
OM growth 5Y4.73%
PM growth 3Y6.51%
PM growth 5Y5.09%
GM growth 3Y2.77%
GM growth 5Y1.66%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so LII is creating value.
The number of shares outstanding for LII has been increased compared to 1 year ago.
Compared to 5 years ago, LII has less shares outstanding
Compared to 1 year ago, LII has a worse debt to assets ratio.
2.2 Solvency
An Altman-Z score of 9.57 indicates that LII is not in any danger for bankruptcy at the moment.
With an excellent Altman-Z score value of 9.57, LII belongs to the best of the industry, outperforming 92.31% of the companies in the same industry.
LII has a debt to FCF ratio of 1.63. This is a very positive value and a sign of high solvency as it would only need 1.63 years to pay back of all of its debts.
LII's Debt to FCF ratio of 1.63 is fine compared to the rest of the industry. LII outperforms 71.79% of its industry peers.
LII has a Debt/Equity ratio of 1.10. This is a high value indicating a heavy dependency on external financing.
LII has a worse Debt to Equity ratio (1.10) than 82.05% of its industry peers.
Even though the debt/equity ratio score it not favorable for LII, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.1 | ||
| Debt/FCF | 1.63 | ||
| Altman-Z | 9.57 |
ROIC/WACC3.69
WACC10.59%
2.3 Liquidity
A Current Ratio of 1.39 indicates that LII should not have too much problems paying its short term obligations.
Looking at the Current ratio, with a value of 1.39, LII is doing worse than 82.05% of the companies in the same industry.
LII has a Quick Ratio of 1.39. This is a bad value and indicates that LII is not financially healthy enough and could expect problems in meeting its short term obligations.
LII has a worse Quick ratio (0.87) than 79.49% of its industry peers.
LII does not score too well on the current and quick ratio evaluation. However, as it has excellent solvency and profitability, these ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.39 | ||
| Quick Ratio | 0.87 |
3. Growth
3.1 Past
LII shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 21.38%, which is quite impressive.
LII shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 13.73% yearly.
LII shows a small growth in Revenue. In the last year, the Revenue has grown by 4.68%.
LII shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 5.11% yearly.
EPS 1Y (TTM)21.38%
EPS 3Y21.8%
EPS 5Y13.73%
EPS Q2Q%24.39%
Revenue 1Y (TTM)4.68%
Revenue growth 3Y11.09%
Revenue growth 5Y5.11%
Sales Q2Q%9.65%
3.2 Future
Based on estimates for the next years, LII will show a quite strong growth in Earnings Per Share. The EPS will grow by 10.32% on average per year.
The Revenue is expected to grow by 7.31% on average over the next years.
EPS Next Y18.32%
EPS Next 2Y14.58%
EPS Next 3Y13.45%
EPS Next 5Y10.32%
Revenue Next Year6.53%
Revenue Next 2Y6.78%
Revenue Next 3Y6.67%
Revenue Next 5Y7.31%
3.3 Evolution
Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
LII is valuated quite expensively with a Price/Earnings ratio of 29.79.
LII's Price/Earnings ratio is a bit more expensive when compared to the industry. LII is more expensive than 69.23% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 27.18, LII is valued at the same level.
LII is valuated quite expensively with a Price/Forward Earnings ratio of 26.01.
Based on the Price/Forward Earnings ratio, LII is valued a bit more expensive than the industry average as 66.67% of the companies are valued more cheaply.
When comparing the Price/Forward Earnings ratio of LII to the average of the S&P500 Index (23.59), we can say LII is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 29.79 | ||
| Fwd PE | 26.01 |
4.2 Price Multiples
76.92% of the companies in the same industry are cheaper than LII, based on the Enterprise Value to EBITDA ratio.
LII's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 31.31 | ||
| EV/EBITDA | 21.55 |
4.3 Compensation for Growth
LII's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
LII has an outstanding profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as LII's earnings are expected to grow with 13.45% in the coming years.
PEG (NY)1.63
PEG (5Y)2.17
EPS Next 2Y14.58%
EPS Next 3Y13.45%
5. Dividend
5.1 Amount
With a yearly dividend of 0.73%, LII is not a good candidate for dividend investing.
LII's Dividend Yield is comparable with the industry average which is at 1.05.
Compared to an average S&P500 Dividend Yield of 2.30, LII's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.73% |
5.2 History
On average, the dividend of LII grows each year by 13.43%, which is quite nice.
LII has been paying a dividend for at least 10 years, so it has a reliable track record.
LII has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)13.43%
Div Incr Years14
Div Non Decr Years24
5.3 Sustainability
15.83% of the earnings are spent on dividend by LII. This is a low number and sustainable payout ratio.
The dividend of LII is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP15.83%
EPS Next 2Y14.58%
EPS Next 3Y13.45%
LENNOX INTERNATIONAL INC
NYSE:LII (12/30/2024, 8:04:00 PM)
After market: 613.99 0 (0%)613.99
-6.04 (-0.97%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryBuilding Products
Earnings (Last)
Earnings (Next)
Inst Owners72.26%
Inst Owner Change-5.24%
Ins Owners10.31%
Ins Owner Change-6%
Market Cap21.87B
Analysts65.6
Price Target642.42 (4.63%)
Short Float %4.17%
Short Ratio5.18
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.73% |
Dividend Growth(5Y)13.43%
DP15.83%
Div Incr Years14
Div Non Decr Years24
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)6.59%
Min EPS beat(2)2.91%
Max EPS beat(2)10.27%
EPS beat(4)4
Avg EPS beat(4)6.44%
Min EPS beat(4)2.91%
Max EPS beat(4)10.27%
EPS beat(8)8
Avg EPS beat(8)9%
EPS beat(12)11
Avg EPS beat(12)8.74%
EPS beat(16)14
Avg EPS beat(16)11.27%
Revenue beat(2)1
Avg Revenue beat(2)1.04%
Min Revenue beat(2)-2.68%
Max Revenue beat(2)4.76%
Revenue beat(4)2
Avg Revenue beat(4)0.41%
Min Revenue beat(4)-2.68%
Max Revenue beat(4)4.76%
Revenue beat(8)5
Avg Revenue beat(8)0.95%
Revenue beat(12)8
Avg Revenue beat(12)1.01%
Revenue beat(16)11
Avg Revenue beat(16)1.74%
PT rev (1m)0.15%
PT rev (3m)7.09%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-0.4%
EPS NY rev (1m)0.02%
EPS NY rev (3m)3.52%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)2.41%
Revenue NY rev (1m)0%
Revenue NY rev (3m)2.19%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 29.79 | ||
| Fwd PE | 26.01 | ||
| P/S | 4.25 | ||
| P/FCF | 31.31 | ||
| P/OCF | 23.59 | ||
| P/B | 29.01 | ||
| P/tB | 40.95 | ||
| EV/EBITDA | 21.55 |
EPS(TTM)20.61
EY3.36%
EPS(NY)23.6
Fwd EY3.84%
FCF(TTM)19.61
FCFY3.19%
OCF(TTM)26.03
OCFY4.24%
SpS144.61
BVpS21.17
TBVpS14.99
PEG (NY)1.63
PEG (5Y)2.17
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 22.75% | ||
| ROE | 99.96% | ||
| ROCE | 48.66% | ||
| ROIC | 39.11% | ||
| ROICexc | 44.85% | ||
| ROICexgc | 51.33% | ||
| OM | 18.87% | ||
| PM (TTM) | 14.63% | ||
| GM | 32.45% | ||
| FCFM | 13.56% |
ROA(3y)20.6%
ROA(5y)19.89%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)40.8%
ROIC(5y)37.97%
ROICexc(3y)42.74%
ROICexc(5y)40.08%
ROICexgc(3y)51.23%
ROICexgc(5y)48.2%
ROCE(3y)51.93%
ROCE(5y)47.94%
ROICexcg growth 3Y0.72%
ROICexcg growth 5Y-10.74%
ROICexc growth 3Y2.14%
ROICexc growth 5Y-7.96%
OM growth 3Y6.44%
OM growth 5Y4.73%
PM growth 3Y6.51%
PM growth 5Y5.09%
GM growth 3Y2.77%
GM growth 5Y1.66%
F-Score8
Asset Turnover1.55
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.1 | ||
| Debt/FCF | 1.63 | ||
| Debt/EBITDA | 0.78 | ||
| Cap/Depr | 244.23% | ||
| Cap/Sales | 4.44% | ||
| Interest Coverage | 18.37 | ||
| Cash Conversion | 87.03% | ||
| Profit Quality | 92.69% | ||
| Current Ratio | 1.39 | ||
| Quick Ratio | 0.87 | ||
| Altman-Z | 9.57 |
F-Score8
WACC10.59%
ROIC/WACC3.69
Cap/Depr(3y)189.41%
Cap/Depr(5y)164.98%
Cap/Sales(3y)3.24%
Cap/Sales(5y)2.93%
Profit Quality(3y)70.31%
Profit Quality(5y)86.37%
High Growth Momentum
Growth
EPS 1Y (TTM)21.38%
EPS 3Y21.8%
EPS 5Y13.73%
EPS Q2Q%24.39%
EPS Next Y18.32%
EPS Next 2Y14.58%
EPS Next 3Y13.45%
EPS Next 5Y10.32%
Revenue 1Y (TTM)4.68%
Revenue growth 3Y11.09%
Revenue growth 5Y5.11%
Sales Q2Q%9.65%
Revenue Next Year6.53%
Revenue Next 2Y6.78%
Revenue Next 3Y6.67%
Revenue Next 5Y7.31%
EBIT growth 1Y28.34%
EBIT growth 3Y18.24%
EBIT growth 5Y10.07%
EBIT Next Year33.01%
EBIT Next 3Y16.45%
EBIT Next 5Y11.09%
FCF growth 1Y279.67%
FCF growth 3Y-3.08%
FCF growth 5Y3.96%
OCF growth 1Y220.5%
OCF growth 3Y6.33%
OCF growth 5Y8.24%