Lennox International (NYSE:LII) Issues Earnings Results

Key Points

• Q1 adjusted EPS $3.35 beat consensus of $3.16, and management reaffirmed FY2026 adjusted EPS guidance of $23.50–$25.00 while raising revenue growth guidance to ~8% (Q1 revenue $1.14B, +5.8% YoY).
• Operations were mixed: Building Climate Solutions delivered a record quarter (organic sales ~+26% and ~300 bps margin expansion; BCS revenue guided ~+16% for 2026), while Home Comfort Solutions was soft (HCS revenue down ~10%, volumes −21%) with margins hit by factory under‑absorption (~$50M impact overall, ~$15M in Q1) and ~$23M of material cost pressure.
• Management now models ~5% input cost inflation and flagged new Section 232 tariffs as added uncertainty (FIFO delays P&L impact until Q3), but completed ~$550M of bolt‑on acquisitions, plans ~$250M capex, continues buybacks and expects full‑year free cash flow of $750–$850M.

Lennox International (NYSE:LII - Get Free Report) released its quarterly earnings results on Wednesday. The construction company reported $3.35 earnings per share for the quarter, beating the consensus estimate of $3.16 by $0.19, FiscalAI reports. The firm had revenue of $1.14 billion for the quarter, compared to analysts' expectations of $1.54 billion. Lennox International had a return on equity of 80.23% and a net margin of 15.13%.The company's revenue was up 5.8% compared to the same quarter last year. During the same quarter last year, the firm posted $3.63 EPS. Lennox International updated its FY 2026 guidance to 23.500-25.000 EPS.

Here are the key takeaways from Lennox International's conference call:

• Lennox reported Q1 revenue of $1.1 billion (+6% YoY) and reaffirmed full‑year adjusted EPS guidance of $23.50–$25.00 while raising revenue guidance to ~8% growth.
• Home Comfort Solutions is still soft—HCS revenue fell ~10% (organic −12%, volumes −21%) and margins were hurt by factory under‑absorption (management cited roughly a $50M absorption impact overall and ~$15M in Q1) plus ~$23M of material cost pressure.
• Building Climate Solutions delivered a record quarter with organic sales up ~26%, ~300 bps margin expansion, driven by emergency replacement, national accounts, and recent M&A, and BCS revenue is guided to grow ~16% for 2026.
• Input cost and tariff headwinds increased materially (aluminum, steel, copper, diesel up meaningfully) and Lennox now models ~5% cost inflation; new Section 232 tariffs create added uncertainty, with FIFO accounting delaying income‑statement impact until Q3.
• Balance sheet and capital allocation remain constructive—completed the ~$550M bolt‑on acquisitions (Duro Dyne/Supco), continue buybacks, expect full‑year free cash flow of $750M–$850M, and plan ~$250M capex for innovation, ERP/digital modernization and targeted AI.

Lennox International Stock Up 4.4%

Shares of LII opened at $517.53 on Thursday. Lennox International has a 1 year low of $434.06 and a 1 year high of $689.44. The company has a debt-to-equity ratio of 0.98, a current ratio of 1.60 and a quick ratio of 0.63. The stock has a 50 day simple moving average of $498.39 and a two-hundred day simple moving average of $502.93. The firm has a market cap of $18.02 billion, a P/E ratio of 23.27, a P/E/G ratio of 1.93 and a beta of 1.21.

Lennox International Dividend Announcement

The company also recently announced a quarterly dividend, which was paid on Wednesday, April 15th. Shareholders of record on Tuesday, March 31st were paid a $1.30 dividend. The ex-dividend date of this dividend was Tuesday, March 31st. This represents a $5.20 annualized dividend and a yield of 1.0%. Lennox International's dividend payout ratio is currently 23.38%.

Lennox International News Roundup

Here are the key news stories impacting Lennox International this week:

• Positive Sentiment: Management reaffirmed full‑year FY2026 EPS guidance of $23.50–$25.00, which aligns with Street expectations and reduces near‑term forecast uncertainty. Press Release
• Positive Sentiment: Revenue increased ~6% year‑over‑year to about $1.14 billion, demonstrating ongoing top‑line growth in the quarter. Revenue growth is a favorable datapoint for durable demand in Lennox’s markets. Press Release
• Positive Sentiment: Some outlets (Zacks) flagged that Lennox beat that service’s EPS estimate ($3.35 actual vs. $3.16 Zacks estimate), which may have supported positive sentiment among shorter‑term traders. Zacks: Surpasses Estimates
• Neutral Sentiment: Full Q1 earnings call transcript and slide deck are available for investors to assess management commentary on backlog, pricing, and margin outlook. The call can shift sentiment depending on tone. Earnings Call Transcript
• Negative Sentiment: GAAP diluted EPS declined (~8% YoY) to $3.35 and GAAP operating income fell ~3% vs. prior year, signaling margin pressure and weaker profitability in the quarter. Press Release
• Negative Sentiment: Certain summaries noted the quarter missed some consensus figures (revenue and EPS vs. certain estimates), which could temper confidence if investors focus on those headline misses. MarketBeat Coverage

Insiders Place Their Bets

In other news, Director Todd J. Teske sold 700 shares of the business's stock in a transaction that occurred on Wednesday, February 4th. The shares were sold at an average price of $533.45, for a total value of $373,415.00. Following the completion of the sale, the director directly owned 6,881 shares in the company, valued at approximately $3,670,669.45. The trade was a 9.23% decrease in their position. The sale was disclosed in a legal filing with the SEC, which can be accessed through this hyperlink. Also, Director Shane D. Wall sold 100 shares of the company's stock in a transaction on Wednesday, February 25th. The shares were sold at an average price of $540.01, for a total transaction of $54,001.00. Following the completion of the sale, the director directly owned 2,205 shares of the company's stock, valued at $1,190,722.05. This trade represents a 4.34% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. Over the last ninety days, insiders have sold 1,054 shares of company stock valued at $563,687. 9.80% of the stock is currently owned by corporate insiders.

Institutional Trading of Lennox International

Hedge funds and other institutional investors have recently bought and sold shares of the stock. Ameriprise Financial Inc. raised its holdings in Lennox International by 296.0% in the 2nd quarter. Ameriprise Financial Inc. now owns 71,815 shares of the construction company's stock worth $41,168,000 after purchasing an additional 53,679 shares in the last quarter. Danske Bank A S purchased a new position in shares of Lennox International during the third quarter valued at about $7,249,000. Lazard Asset Management LLC increased its position in shares of Lennox International by 111.1% during the second quarter. Lazard Asset Management LLC now owns 18,659 shares of the construction company's stock valued at $10,696,000 after buying an additional 9,818 shares during the period. Entropy Technologies LP bought a new position in Lennox International in the third quarter worth about $2,479,000. Finally, Dark Forest Capital Management LP bought a new position in Lennox International in the third quarter worth about $2,043,000. Institutional investors own 67.07% of the company's stock.

Wall Street Analyst Weigh In

Several research analysts recently weighed in on LII shares. Wall Street Zen upgraded shares of Lennox International from a "sell" rating to a "hold" rating in a research report on Saturday, March 7th. Morgan Stanley cut their price target on shares of Lennox International from $475.00 to $450.00 and set an "underweight" rating for the company in a research note on Monday, February 2nd. Wells Fargo & Company decreased their price target on shares of Lennox International from $560.00 to $480.00 and set an "equal weight" rating on the stock in a report on Wednesday, April 1st. Weiss Ratings restated a "hold (c+)" rating on shares of Lennox International in a research report on Thursday, January 22nd. Finally, Barclays dropped their price objective on shares of Lennox International from $667.00 to $600.00 and set an "overweight" rating for the company in a report on Wednesday, April 1st. Four investment analysts have rated the stock with a Buy rating, ten have assigned a Hold rating and two have issued a Sell rating to the stock. According to MarketBeat.com, the stock currently has an average rating of "Hold" and an average price target of $563.67.

Lennox International Company Profile

Lennox International Inc is a global manufacturer of climate control products and services, principally serving residential and commercial heating, ventilation and air conditioning (HVAC) markets. The company designs, engineers and produces a range of products including furnaces, air conditioners, heat pumps, air handlers, packaged rooftop units and related controls and indoor air quality equipment. Lennox also supplies aftermarket parts and accessories and supports its product lines with technical service, training and warranty programs for dealer and distribution partners.

Originally founded in 1895 by Dave Lennox, the company has grown from its early roots into a multinational business with operations concentrated in North America and a presence in other international markets.