Lennox International Inc. (LII), headquartered in Richardson, Texas, designs, manufactures and markets products for the heating, ventilation, air conditioning and refrigeration markets. Valued at $18.6 billion by market capitalization, the company sells its products and services through direct sales, distributors, and company-owned parts and supply stores.

Shares of this leader in energy-efficient climate control solutions have underperformed the broader market over the past year. The II has declined 9.5% over that time period, while the broader S&P 500 ($SPX) is up nearly 14%. However, in 2026 LII shares are up 9.1%, outpacing the SPX’s 1.3% gain since the previous year.

Narrowing the focus, LII’s underperformance is also evident compared to the Select Industrial Sector SPDR Fund ( XLI ). The exchange-traded fund has gained about 25.7% over the past year. Additionally, the ETF’s 11.6% gain on a YTD basis dwarfs the stock’s high single-digit returns over the same time period.

LII faces headwinds due to channel depletion and weak demand in residential construction.

On Jan. 28, LII shares closed up more than 2% after reporting its fourth-quarter results. Its adjusted EPS of $4.45 fell short of Wall Street expectations of $4.76. The company’s revenue was $1.2 billion, missing Wall Street forecasts of $1.3 billion. LII expects full-year adjusted EPS in the range of $23.50 to $25.

For the current fiscal year, which ends in December, analysts expect LII’s EPS to grow 4.2% to $24.12 on a diluted basis. The company’s history of earnings surprises is mixed. It beat the consensus estimate in three of the last four quarters, while missing the forecast on another occasion.

Among the 19 analysts covering LII stock, the consensus is a “moderate buy”. It is based on six “Strong Buy”, 11 “Hold”, one “Moderate Sell” and one “Strong Sell” ratings.

This setup is more bullish than three months ago, with an overall “Hold” rating, composed of two analysts suggesting a “strong sell.”

On February 1, Morgan Stanley ( MS ) maintained an “Underweight” rating on LII and lowered the price target to $450.

The average price target of $552.07 represents a 4.2% premium to LII’s current price levels. The Street price target of $667 suggests a potential upside of 25.9%.

As of the date of publication, Neha Panjwani had no positions (either directly or indirectly) in any of the securities mentioned in this article. All information and data in this article is for informational purposes only. This article was originally published on Barchart.com