On October 29, a recent SEC filing unveiled that Michael Quenzer, EVP at Lennox Intl LII made an insider sell.

What Happened: Quenzer’s decision to sell 1,063 shares of Lennox Intl was revealed in a Form 4 filing with the U.S. Securities and Exchange Commission on Tuesday. The total value of the sale is $659,081.

At Wednesday morning, Lennox Intl shares are down by 1.11%, trading at $604.0.

About Lennox Intl

Lennox International manufactures and distributes heating, ventilating, air conditioning, and refrigeration products to replacement (75% of sales) and new construction (25% of sales) markets. In fiscal 2023, residential HVAC was 68% of sales and commercial HVAC and Heatcraft refrigeration was 32% of sales. The company goes to market with multiple brands, but Lennox is the company’s flagship HVAC brand. The Texas-based company is focused on North America after the sale of its European HVAC and refrigeration businesses in late 2023.

Breaking Down Lennox Intl’s Financial Performance

Revenue Growth: Lennox Intl’s remarkable performance in 3 months is evident. As of 30 September, 2024, the company achieved an impressive revenue growth rate of 9.65%. This signifies a substantial increase in the company’s top-line earnings. As compared to competitors, the company surpassed expectations with a growth rate higher than the average among peers in the Industrials sector.

Holistic Profitability Examination:

• Gross Margin: The company shows a low gross margin of 32.6%, indicating concerns regarding cost management and overall profitability relative to its industry counterparts.

• Earnings per Share (EPS): Lennox Intl’s EPS outshines the industry average, indicating a strong bottom-line trend with a current EPS of 6.71.

Debt Management: The company faces challenges in debt management with a debt-to-equity ratio higher than the industry average. With a ratio of 1.89, caution is advised due to increased financial risk.

Market Valuation:

• Price to Earnings (P/E) Ratio: The current P/E ratio of 29.02 is below industry norms, indicating potential undervaluation and presenting an investment opportunity.

• Price to Sales (P/S) Ratio: With a higher-than-average P/S ratio of 4.25, Lennox Intl’s stock is perceived as being overvalued in the market, particularly in relation to sales performance.

• EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): Lennox Intl’s EV/EBITDA ratio stands at 21.41, surpassing industry benchmarks. This places the company in a position with a higher-than-average market valuation.

Market Capitalization Analysis: The company’s market capitalization surpasses industry averages, showcasing a dominant size relative to peers and suggesting a strong market position.

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Delving Into the Significance of Insider Transactions

Investors should view insider transactions as part of a multifaceted analysis and not rely solely on them for decision-making.

Within the legal framework, an “insider” is defined as any officer, director, or beneficial owner holding more than ten percent of a company’s equity securities as per Section 12 of the Securities Exchange Act of 1934. This includes executives in the c-suite and major hedge funds. These insiders are mandated to disclose their transactions through a Form 4 filing, to be submitted within two business days of the transaction.

The initiation of a new purchase by a company insider serves as a strong indication that they expect the stock to rise.

However, insider sells may not always signal a bearish view and can be influenced by various factors.

A Closer Look at Important Transaction Codes

Examining transactions, investors often concentrate on those unfolding in the open market, meticulously detailed in Table I of the Form 4 filing. A P in Box 3 denotes a purchase, while S signifies a sale. Transaction code C indicates the conversion of an option, and transaction code A denotes a grant, award, or other acquisition of securities from the company.

Check Out The Full List Of Lennox Intl’s Insider Trades.

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This article was generated by Benzinga’s automated content engine and reviewed by an editor.