What Happened?
Shares of climate control solutions innovator Lennox International (NYSE: LII) fell 3.6% in the afternoon session after multiple analyst firms lowered their price targets on the stock, citing market challenges.
Jefferies reduced its price target on Lennox International to $645 from $665, while Wolfe Research made a deeper cut to $606 from $665, with both firms maintaining their respective Hold and Underperform ratings. The cautious sentiment follows a presentation by Lennox at a Morgan Stanley conference, where the company acknowledged pressures from regulatory changes and tariffs. More significantly, the company highlighted that it has experienced 11 consecutive months of declining HRI (Heating, Refrigeration, and Air-Conditioning Institute) shipments, signaling persistent weakness in the HVAC market and providing a fundamental basis for the analysts' revised outlooks.
The shares closed the day at $544.66, down 4% from previous close.
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What Is The Market Telling Us
Lennox’s shares are not very volatile and have only had 5 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.
The previous big move we wrote about was 3 days ago when the stock dropped 4.1% on the news that concerns about the health of the U.S. economy grew following a significant downward revision of job market data.
The Labor Department reported that employers added 911,000 fewer jobs from April 2024 through March than initially estimated. These "benchmark revisions" are issued annually to more accurately account for new and defunct businesses. The report detailed that the leisure and hospitality sector added 176,000 fewer jobs, professional and business services 158,000 fewer, and retailers 126,000 fewer. This weaker-than-expected data has fueled investor anxiety, as it suggests businesses may be becoming more reluctant to hire amid economic uncertainty. The numbers issued are preliminary, with final revisions scheduled for February 2026.
JPMorgan Chase CEO Jamie Dimon added that the U.S. economy is "weakening," though he stopped short of predicting a recession. "Whether it's on the way to recession or just weakening, I don't know," he said. Dimon's remarks are closely watched, given his influence as head of one of the nation's largest banks.
Lennox is down 9.9% since the beginning of the year, and at $544.48 per share, it is trading 19.7% below its 52-week high of $678.43 from November 2024. Investors who bought $1,000 worth of Lennox’s shares 5 years ago would now be looking at an investment worth $1,969.
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