Lennox Q3 revenue misses on competitive pressure, inflation
Overview
U.S. HVAC solutions provider's Q3 revenue rose 10% yr/yr, a slight miss versus analyst expectations
Adjusted EPS for Q3 fell 7% and missed analyst expectations
Profitability pressured by competitive environment and inflation-driven cost increases
Outlook
Lennox sees 2026 revenue growth of about 6%, including 5% from acquisitions
Company lowers 2026 adjusted EPS guidance to $21.00-$21.50 from $23.00-$24.00
Lennox expects 2026 free cash flow of $700 mln to $750 mln
Result Drivers
COMPETITIVE PRESSURE - Co said heightened competition weighed on margins and results, per CEO Alok Maskara
INFLATION AND COSTS - Product cost inflation, tariffs, higher fuel and distribution costs reduced profitability
PRICE ADJUSTMENTS - Co implemented targeted price adjustments in select segments to defend and recapture share
Company press release:
Key Details
Metric | Beat/Miss | Actual | Consensus Estimate |
Q3 Revenue | Slight Miss* | $1.57 bln | $1.58 bln (14 Analysts) |
Q3 Adjusted EPS | Miss | $6.84 | $7.36 (16 Analysts) |
Q3 EPS | $6.41 |
*Applies to a deviation of less than 1%; not applicable for per-share numbers.
Analyst Coverage
The current average analyst rating on the shares is "hold" and the breakdown of recommendations is 3 "strong buy" or "buy", 15 "hold" and 2 "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 $438.00, about 17.7% above its October 27 closing price of $372.05
The stock recently traded at 15 times the next 12-month earnings vs. a P/E of 22 three months ago
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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)