Lennox International Inc.
Lennox International Inc. Fundamental Analysis
Lennox International Inc. (LII) shows moderate financial fundamentals with a PE ratio of 24.67, profit margin of 15.13%, and ROE of 78.89%. The company generates $5.2B in annual revenue with moderate year-over-year growth of 7.21%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 63.8/100 based on profitability, valuation, growth, and balance sheet metrics. The C+ grade reflects average fundamentals, with notable risks in certain areas.
Fundamental Health Score
We analyze LII's fundamental strength across five key dimensions:
Efficiency Score
ExcellentLII demonstrates superior asset utilization.
Valuation Score
ExcellentLII trades at attractive valuation levels.
Growth Score
ExcellentLII delivers strong and consistent growth momentum.
Financial Health Score
ModerateLII shows balanced financial health with some risks.
Profitability Score
ExcellentLII achieves industry-leading margins.
Key Financial Metrics
Is LII Expensive or Cheap?
P/E Ratio
LII trades at 24.67 times earnings. This indicates a fair valuation.
PEG Ratio
When adjusting for growth, LII's PEG of -3.99 indicates potential undervaluation.
Price to Book
The market values Lennox International Inc. at 16.68 times its book value. This suggests the stock is fully valued or overvalued on an asset basis.
EV/EBITDA
Enterprise value stands at 15.64 times EBITDA. This signals the market has high growth expectations.
How Well Does LII Make Money?
Net Profit Margin
For every $100 in sales, Lennox International Inc. keeps $15.13 as profit after all expenses.
Operating Margin
Core operations generate 19.55 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $78.89 in profit for every $100 of shareholder equity.
ROA
Lennox International Inc. generates $19.26 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Lennox International Inc. produces operating cash flow of $749.19M, showing steady but balanced cash generation.
Free Cash Flow
Lennox International Inc. generates strong free cash flow of $629.80M, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $17.96 in free cash annually.
FCF Yield
LII converts 3.21% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
24.67
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
-3.99
vs 25 benchmark
P/B Ratio
Price to book value ratio
16.68
vs 25 benchmark
P/S Ratio
Price to sales ratio
3.75
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
1.77
vs 25 benchmark
Current Ratio
Current assets to current liabilities
1.60
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.79
vs 25 benchmark
ROA
Return on assets percentage
0.19
vs 25 benchmark
ROCE
Return on capital employed
0.35
vs 25 benchmark
How LII Stacks Against Its Sector Peers
| Metric | LII Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 24.67 | 26.49 | Neutral |
| ROE | 78.89% | 1307.00% | Weak |
| Net Margin | 15.13% | -5131.00% (disorted) | Strong |
| Debt/Equity | 1.77 | 0.81 | Weak (High Leverage) |
| Current Ratio | 1.60 | 10.48 | Neutral |
| ROA | 19.26% | -1549793.00% (disorted) | Strong |
LII outperforms its industry in 2 out of 6 key metrics, particularly excelling in Net Margin, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Lennox International Inc.'s 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
53.69%
Industry Style: Cyclical, Value, Infrastructure
High GrowthEPS CAGR
116.29%
Industry Style: Cyclical, Value, Infrastructure
High GrowthFCF CAGR
161.56%
Industry Style: Cyclical, Value, Infrastructure
High Growth