LENNOX INTERNATIONAL INC (LII) Stock Fundamental Analysis
USA - NYSE:LII - US5261071071 - Common Stock
471.5 USD
-5.16 (-1.08%)
471.6 USD
+0.1 (+0.02%)
Taking everything into account, LII scores 7 out of 10 in our fundamental rating. LII was compared to 41 industry peers in the Building Products industry. LII scores excellent points on both the profitability and health parts. This is a solid base for a good stock. While showing a medium growth rate, LII is valued expensive at the moment. These ratings would make LII suitable for quality investing!
1. Profitability
1.1 Basic Checks
LII had positive earnings in the past year.
LII had a positive operating cash flow in the past year.
In the past 5 years LII has always been profitable.
Each year in the past 5 years LII had a positive operating cash flow.
1.2 Ratios
Looking at the Return On Assets, with a value of 23.87%, LII belongs to the top of the industry, outperforming 100.00% of the companies in the same industry.
LII has a Return On Equity of 78.63%. This is amongst the best in the industry. LII outperforms 97.56% of its industry peers.
Looking at the Return On Invested Capital, with a value of 33.53%, LII belongs to the top of the industry, outperforming 100.00% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for LII is significantly above the industry average of 12.54%.
The last Return On Invested Capital (33.53%) for LII is well below the 3 year average (42.17%), which needs to be investigated, but indicates that LII had better years and this may not be a problem.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 23.87% | ||
| ROE | 78.63% | ||
| ROIC | 33.53% |
ROA(3y)21.23%
ROA(5y)20.52%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)42.17%
ROIC(5y)38.23%
1.3 Margins
LII has a Profit Margin of 15.74%. This is amongst the best in the industry. LII outperforms 85.37% of its industry peers.
In the last couple of years the Profit Margin of LII has grown nicely.
LII has a better Operating Margin (19.86%) than 82.93% of its industry peers.
LII's Operating Margin has improved in the last couple of years.
LII has a Gross Margin (33.20%) which is comparable to the rest of the industry.
In the last couple of years the Gross Margin of LII has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 19.86% | ||
| PM (TTM) | 15.74% | ||
| GM | 33.2% |
OM growth 3Y11.75%
OM growth 5Y8.73%
PM growth 3Y10.94%
PM growth 5Y7.07%
GM growth 3Y5.4%
GM growth 5Y3.18%
2. Health
2.1 Basic Checks
LII has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
LII has about the same amout of shares outstanding than it did 1 year ago.
The number of shares outstanding for LII has been reduced compared to 5 years ago.
LII has a better debt/assets ratio than last year.
2.2 Solvency
LII has an Altman-Z score of 8.72. This indicates that LII is financially healthy and has little risk of bankruptcy at the moment.
The Altman-Z score of LII (8.72) is better than 97.56% of its industry peers.
LII has a debt to FCF ratio of 1.89. This is a very positive value and a sign of high solvency as it would only need 1.89 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 1.89, LII is in the better half of the industry, outperforming 73.17% of the companies in the same industry.
A Debt/Equity ratio of 0.93 indicates that LII is somewhat dependend on debt financing.
LII has a Debt to Equity ratio of 0.93. This is in the lower half of the industry: LII underperforms 68.29% of its industry peers.
Although LII does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.93 | ||
| Debt/FCF | 1.89 | ||
| Altman-Z | 8.72 |
ROIC/WACC3.52
WACC9.52%
2.3 Liquidity
A Current Ratio of 1.68 indicates that LII should not have too much problems paying its short term obligations.
LII has a worse Current ratio (1.68) than 68.29% of its industry peers.
A Quick Ratio of 0.80 indicates that LII may have some problems paying its short term obligations.
With a Quick ratio value of 0.80, LII is not doing good in the industry: 80.49% of the companies in the same industry are doing better.
The current and quick ratio evaluation for LII is rather negative, while it does have 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 | 1.68 | ||
| Quick Ratio | 0.8 |
3. Growth
3.1 Past
LII shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 15.33%, which is quite good.
LII shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 15.03% yearly.
LII shows a small growth in Revenue. In the last year, the Revenue has grown by 3.77%.
LII shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 7.01% yearly.
EPS 1Y (TTM)15.33%
EPS 3Y21.5%
EPS 5Y15.03%
EPS Q2Q%4.49%
Revenue 1Y (TTM)3.77%
Revenue growth 3Y8.39%
Revenue growth 5Y7.01%
Sales Q2Q%-4.76%
3.2 Future
LII is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 10.73% yearly.
LII is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 8.49% yearly.
EPS Next Y2.77%
EPS Next 2Y5.66%
EPS Next 3Y7.33%
EPS Next 5Y10.73%
Revenue Next Year0.93%
Revenue Next 2Y4.21%
Revenue Next 3Y4.67%
Revenue Next 5Y8.49%
3.3 Evolution
The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in 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
A Price/Earnings ratio of 19.84 indicates a rather expensive valuation of LII.
The rest of the industry has a similar Price/Earnings ratio as LII.
LII is valuated rather cheaply when we compare the Price/Earnings ratio to 25.89, which is the current average of the S&P500 Index.
A Price/Forward Earnings ratio of 18.70 indicates a rather expensive valuation of LII.
LII's Price/Forward Earnings ratio is in line with the industry average.
When comparing the Price/Forward Earnings ratio of LII to the average of the S&P500 Index (34.59), we can say LII is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.84 | ||
| Fwd PE | 18.7 |
4.2 Price Multiples
LII's Enterprise Value to EBITDA ratio is in line with the industry average.
LII's Price/Free Cash Flow ratio is in line with the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 30.99 | ||
| EV/EBITDA | 15.03 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates LII does not grow enough to justify the current Price/Earnings ratio.
The excellent profitability rating of LII may justify a higher PE ratio.
PEG (NY)7.15
PEG (5Y)1.32
EPS Next 2Y5.66%
EPS Next 3Y7.33%
5. Dividend
5.1 Amount
LII has a Yearly Dividend Yield of 1.06%.
The stock price of LII dropped by -20.31% in the last 3 months. With lower prices the dividend yield is higher, but it may be a sign investors do not trust the long term dividend.
LII's Dividend Yield is a higher than the industry average which is at 1.33.
Compared to an average S&P500 Dividend Yield of 2.36, LII's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.06% |
5.2 History
The dividend of LII is nicely growing with an annual growth rate of 9.85%!
LII has paid a dividend for at least 10 years, which is a reliable track record.
LII has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)9.85%
Div Incr Years15
Div Non Decr Years25
5.3 Sustainability
20.01% of the earnings are spent on dividend by LII. This is a low number and sustainable payout ratio.
LII's earnings are growing around the same pace than its dividend. As long as the earnings growth is kept the dividend growth is sustainable.
DP20.01%
EPS Next 2Y5.66%
EPS Next 3Y7.33%
471.5
-5.16 (-1.08%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryBuilding Products
Earnings (Last)
Earnings (Next)
Inst Owners77.77%
Inst Owner Change-0.12%
Ins Owners10.23%
Ins Owner Change-4.71%
Market Cap16.56B
Revenue(TTM)5.35B
Net Income(TTM)841.40M
Analysts67.2
Price Target580.95 (23.21%)
Short Float %4.73%
Short Ratio3.29
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.06% |
Yearly Dividend4.5
Dividend Growth(5Y)9.85%
DP20.01%
Div Incr Years15
Div Non Decr Years25
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)7.2%
Min EPS beat(2)1.48%
Max EPS beat(2)12.93%
EPS beat(4)4
Avg EPS beat(4)11.85%
Min EPS beat(4)1.48%
Max EPS beat(4)31%
EPS beat(8)8
Avg EPS beat(8)9.15%
EPS beat(12)12
Avg EPS beat(12)9.95%
EPS beat(16)15
Avg EPS beat(16)9.52%
Revenue beat(2)1
Avg Revenue beat(2)-2.27%
Min Revenue beat(2)-5.2%
Max Revenue beat(2)0.66%
Revenue beat(4)3
Avg Revenue beat(4)1.73%
Min Revenue beat(4)-5.2%
Max Revenue beat(4)7.51%
Revenue beat(8)5
Avg Revenue beat(8)1.07%
Revenue beat(12)8
Avg Revenue beat(12)1.21%
Revenue beat(16)11
Avg Revenue beat(16)1.19%
PT rev (1m)-11.1%
PT rev (3m)-13.89%
EPS NQ rev (1m)-11.32%
EPS NQ rev (3m)-12.58%
EPS NY rev (1m)-3.71%
EPS NY rev (3m)0.13%
Revenue NQ rev (1m)-4.01%
Revenue NQ rev (3m)-4.72%
Revenue NY rev (1m)-2.65%
Revenue NY rev (3m)-3.44%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.84 | ||
| Fwd PE | 18.7 | ||
| P/S | 3.1 | ||
| P/FCF | 30.99 | ||
| P/OCF | 24.21 | ||
| P/B | 15.47 | ||
| P/tB | 19.48 | ||
| EV/EBITDA | 15.03 |
EPS(TTM)23.77
EY5.04%
EPS(NY)25.21
Fwd EY5.35%
FCF(TTM)15.21
FCFY3.23%
OCF(TTM)19.48
OCFY4.13%
SpS152.2
BVpS30.47
TBVpS24.21
PEG (NY)7.15
PEG (5Y)1.32
Graham Number127.66
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 23.87% | ||
| ROE | 78.63% | ||
| ROCE | 44.33% | ||
| ROIC | 33.53% | ||
| ROICexc | 34.33% | ||
| ROICexgc | 37.65% | ||
| OM | 19.86% | ||
| PM (TTM) | 15.74% | ||
| GM | 33.2% | ||
| FCFM | 10% |
ROA(3y)21.23%
ROA(5y)20.52%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)42.17%
ROIC(5y)38.23%
ROICexc(3y)46.95%
ROICexc(5y)41.92%
ROICexgc(3y)55.8%
ROICexgc(5y)49.64%
ROCE(3y)53.49%
ROCE(5y)48.13%
ROICexgc growth 3Y9.55%
ROICexgc growth 5Y2.53%
ROICexc growth 3Y10.23%
ROICexc growth 5Y4.03%
OM growth 3Y11.75%
OM growth 5Y8.73%
PM growth 3Y10.94%
PM growth 5Y7.07%
GM growth 3Y5.4%
GM growth 5Y3.18%
F-Score7
Asset Turnover1.52
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.93 | ||
| Debt/FCF | 1.89 | ||
| Debt/EBITDA | 0.85 | ||
| Cap/Depr | 142.8% | ||
| Cap/Sales | 2.8% | ||
| Interest Coverage | 26.41 | ||
| Cash Conversion | 58.65% | ||
| Profit Quality | 63.5% | ||
| Current Ratio | 1.68 | ||
| Quick Ratio | 0.8 | ||
| Altman-Z | 8.72 |
F-Score7
WACC9.52%
ROIC/WACC3.52
Cap/Depr(3y)197.58%
Cap/Depr(5y)169.68%
Cap/Sales(3y)3.41%
Cap/Sales(5y)2.99%
Profit Quality(3y)73.25%
Profit Quality(5y)91.54%
High Growth Momentum
Growth
EPS 1Y (TTM)15.33%
EPS 3Y21.5%
EPS 5Y15.03%
EPS Q2Q%4.49%
EPS Next Y2.77%
EPS Next 2Y5.66%
EPS Next 3Y7.33%
EPS Next 5Y10.73%
Revenue 1Y (TTM)3.77%
Revenue growth 3Y8.39%
Revenue growth 5Y7.01%
Sales Q2Q%-4.76%
Revenue Next Year0.93%
Revenue Next 2Y4.21%
Revenue Next 3Y4.67%
Revenue Next 5Y8.49%
EBIT growth 1Y9.24%
EBIT growth 3Y21.13%
EBIT growth 5Y16.35%
EBIT Next Year20.54%
EBIT Next 3Y12.58%
EBIT Next 5Y11.18%
FCF growth 1Y35.13%
FCF growth 3Y24.15%
FCF growth 5Y21.91%
OCF growth 1Y23.37%
OCF growth 3Y22.42%
OCF growth 5Y19.01%
LENNOX INTERNATIONAL INC / LII FAQ
Can you provide the ChartMill fundamental rating for LENNOX INTERNATIONAL INC?
ChartMill assigns a fundamental rating of 7 / 10 to LII.
What is the valuation status of LENNOX INTERNATIONAL INC (LII) stock?
ChartMill assigns a valuation rating of 3 / 10 to LENNOX INTERNATIONAL INC (LII). This can be considered as Overvalued.
Can you provide the profitability details for LENNOX INTERNATIONAL INC?
LENNOX INTERNATIONAL INC (LII) has a profitability rating of 9 / 10.
How financially healthy is LENNOX INTERNATIONAL INC?
The financial health rating of LENNOX INTERNATIONAL INC (LII) is 7 / 10.
What is the expected EPS growth for LENNOX INTERNATIONAL INC (LII) stock?
The Earnings per Share (EPS) of LENNOX INTERNATIONAL INC (LII) is expected to grow by 2.77% in the next year.