Lennox International Inc

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LII : NYSE : Industrial Goods
$162.53 -5.18 | -3.09%
Today's Range: 160.34 - 163.89
Avg. Daily Volume: 343300.0
02/17/17 - 4:02 PM ET

Financial Analysis


LENNOX INTERNATIONAL INC's gross profit margin for the fourth quarter of its fiscal year 2016 has increased when compared to the same period a year ago. The company has grown its sales and net income during the past quarter when compared with the same quarter a year ago, and although its growth in net income has outpaced the industry average, its revenue growth has not. LENNOX INTERNATIONAL INC has weak liquidity. Currently, the Quick Ratio is 0.59 which shows a lack of ability to cover short-term cash needs. The company's liquidity has increased from the same period last year, indicating improving cash flow.

At the same time, stockholders' equity ("net worth") has significantly decreased by 62.84% from the same quarter last year. Overall, the key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the future.

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Income Statement Q4 FY16 Q4 FY15
Net Sales ($mil)897.2834.1
EBITDA ($mil)117.598.9
EBIT ($mil)102.882.7
Net Income ($mil)40.511.3


Balance Sheet Q4 FY16 Q4 FY15
Cash & Equiv. ($mil)50.238.9
Total Assets ($mil)1760.31680.2
Total Debt ($mil)868.2743.9
Equity ($mil)37.6101.2


Profitability Q4 FY16 Q4 FY15
Gross Profit Margin31.4629.9
EBITDA Margin13.0911.85
Operating Margin11.469.91
Sales Turnover2.072.06
Return on Assets15.7811.1
Return on Equity740.95184.98
Debt Q4 FY16 Q4 FY15
Current Ratio1.131.14
Debt/Capital0.960.88
Interest Expense7.45.7
Interest Coverage13.8914.51


Share Data Q4 FY16 Q4 FY15
Shares outstanding (mil)42.9844.68
Div / share0.430.36
EPS0.940.25
Book value / share0.872.27
Institutional Own % n/a n/a
Avg Daily Volume341681.0392794.0

Valuation


BUY. The current P/E ratio indicates a premium compared to an average of 25.86 for the Building Products industry and a value on par with the S&P 500 average of 26.35. For additional comparison, its price-to-book ratio of 191.69 indicates a significant premium versus the S&P 500 average of 2.94 and a significant premium versus the industry average of 18.96. The current price-to-sales ratio is similar to the S&P 500 average, but it is above the industry average, indicating a premium. Upon assessment of these and other key valuation criteria, LENNOX INTERNATIONAL INC proves to trade at a premium to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
LII 26.41 Peers 25.86   LII 20.33 Peers 112.22

Average. An average P/E ratio can signify an industry neutral price for a stock and an average growth expectation.

LII is trading at a valuation on par with its peers.

 

Discount. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

LII is trading at a significant discount to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
LII 18.90 Peers 18.75   LII 1.07 Peers 1.27

Premium. A higher price-to-projected earnings ratio than its peers can signify a more expensive stock or higher future growth expectations.

LII is trading at a premium to its peers.

 

Discount. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

LII trades at a discount to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
LII 191.69 Peers 18.96   LII 54.50 Peers -6.48

Premium. A higher price-to-book ratio makes a stock less attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

LII is trading at a significant premium to its peers.

 

Higher. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

LII is expected to have an earnings growth rate that significantly exceeds its peers.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
LII 1.98 Peers 1.60   LII 5.02 Peers 11.30

Premium. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

LII is trading at a premium to its industry on this measurement.

 

Lower. A sales growth rate that trails the industry implies that a company is losing market share.

LII significantly trails its peers on the basis of sales growth

 

 

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