Lennox International designs, manufactures, and markets climate control products for the heating, ventilation, air conditioning, and refrigeration markets. The company operates in three segments: Residential Heating & Cooling, Commercial Heating & Cooling, and Refrigeration. The company was founded in 1895 and is based in Richardson, Texas.
LII Price Forecast Based on DCF Valuation
DCF Fair Value Target:
Below please find a table outlining a discounted cash flow forecast for LII, in which we model out valuation assuming a variety of terminal growth rates. To summarize, we found that Lennox International Inc ranked in the 66th percentile in terms of potential gain offered. Specifically, our DCF analysis implies the stock is trading below its fair value by an estimated 147.67%. The most interesting components of our discounted cash flow analysis for Lennox International Inc ended up being:
Interest coverage, a measure of earnings relative to interest payments, is 14.75 -- which is good for besting 83.76% of its peer stocks (US stocks in the Industrials sector with positive cash flow).
The business' balance sheet suggests that 10% of the company's capital is sourced from debt; this is greater than just 23.44% of the free cash flow producing stocks we're observing.
LII's estimated cost of debt, based largely on its market capitalization and its interest coverage ratio, is 2%; for context, that number is higher than 36.07% of tickers in our DCF set.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
HNI, KFY, UPWK, DXPE, and HUBG can be thought of as valuation peers to LII, in the sense that they are in the Industrials sector and have a similar price forecast based on DCF valuation.
DALLAS, Oct. 1, 2020 /PRNewswire/ -- Lennox International (LII) is launching the Building Better Air initiative to improve the indoor air quality (IAQ) of commercial spaces. This initiative combines the company's innovative product line and industry leading building services to provide…
DALLAS, Sept. 11, 2020 /PRNewswire/ -- Lennox International Inc. (NYSE: LII) today announced that Chairman and CEO Todd Bluedorn is scheduled to present at the Morgan Stanley 8th Annual Laguna Conference, being held virtually, on Tuesday, September 15. Presentation materials and a live…
Moody's Investors Service ("Moody's") assigned a Baa3 rating to Lennox International Inc.'s ("Lennox") amended and extended $750 million senior unsecured revolving credit facility. All other ratings of Lennox remain unchanged. The extension of Lennox's revolving credit facility to August 2022 from August 2021, which closed on July 30, 2020, is credit positive as it improves the company's liquidity and debt maturity profile.