Research Desk Line-up: Graco Post Earnings Coverage

LONDON, UK / ACCESSWIRE / October 31, 2017 / Pro-Trader Daily has just published a free post-earnings coverage on Lennox International Inc. (NYSE: LII) ("Lennox"), which can be viewed by registering at http://protraderdaily.com/optin/?symbol=LII, following the Company's disclosure of its third quarter fiscal 2017 operating results on October 23, 2017. The furnaces, air conditioners, and other products manufacturer exceeded top- and bottom-line expectations, while it raised its revenue and earnings guidance for the fiscal year. Our daily stock reports are accessible for free, and with those to look forward today you also will be signing up for a complimentary member's account at:

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Get more of our free earnings reports coverage from other constituents of the Diversified Machinery industry. Pro-TD has currently selected Graco Inc. (NYSE: GGG) for due-diligence and potential coverage as the Company announced on October 25, 2017, its financial results for Q3 2017 which ended on September 29, 2017. Register for a free membership today, and be among the early birds that get access to our report on Graco when we publish it.

At Pro-TD, we make it our mission to bring you news that matter about the stock you follow. Today, our research desk covers a blog story on LII; also brushing on GGG. With the links below you can directly download the report of your stock of interest free of charge at:

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Earnings Reviewed

For the quarter ended September 30, 2017, Lennox's revenue was a third quarter record $1.05 billion, up 4% compared to revenue of $1.01 billion in Q3 2016. The Company noted that foreign exchange provided a 1% point benefit to revenue growth, while volume and price also grew. Lennox's revenue numbers topped analysts' estimates of $1.03 billion.

During Q3 2017, Lennox's gross profit totaled $313.7 million, up 1% compared to $310.3 million in Q3 2016. The gross profit figures were positively impacted by higher volume, favorable price, sourcing and engineering-led cost reductions, and foreign exchange. The Company's gross margin was 29.8% for the reported quarter, down 90 basis points compared to the year ago same period.

On a GAAP basis, Lennox's income from continuing operations was $104.0 million, or $2.45 per share, for Q3 2017 compared to $101.7 million, or $2.33 per share, in Q3 2016. The Company's adjusted income from continuing operations was $106.9 million, or $2.53 per share, in the reported quarter compared to $101.9 million, or $2.33 per share, in the prior year's corresponding quarter. Lennox's earnings numbers topped Wall Street's estimates of $2.44 per share.

Segment Results

During Q3 2017, Lennox's revenue in the Residential Heating & Cooling business segment rose 3% to a third quarter record $591 million. The segment's profit was a third quarter record $115 million, up 2% versus the year ago comparable period, while the segment's profit margin was 19.4%, down 30 basis points from Q3 2016. The segment's results were positively impacted by higher volume, favorable price, sourcing and engineering-led cost reductions, and foreign exchange.

For Q3 2017, Lennox's Commercial Heating & Cooling business segment revenue was a record $269 million, up 7%. The segment's profit was a record $50 million in the reported quarter, up 2% compared to Q3 2016, while the segment's margin was 18.6%, down 90 basis points from the year ago same period. The segment's results were positively impacted by higher volume, favorable price, sourcing and engineering-led cost reductions, lower SG&A expenses, and favorable foreign exchange.

Lennox's revenue in the Refrigeration business segment totaled $192 million for Q3 2017, up 3%. The segment's profit margin was down 190 basis points to 10.4%, and the segment's profit declined 13% to $20 million on a y-o-y basis.

Cash Matters

During Q3 2017, Lennox reported net cash from operations of $177 million, up from $152 million in Q3 2016. The Company's capital expenditure was $17 million compared to $18 million in the prior year's corresponding quarter. Lennox's free cash flow was $160 million for the reported quarter, up from approximately $134 million in Q3 2016.

As of September 30, 2017, Lennox's total debt was $1.124 billion and total cash and cash equivalents were $61 million. In Q3 2017, the Company paid approximately $22 million in dividends and $75 million for stock repurchases.

Outlook

For FY17, Lennox updated its guidance for revenue and earnings per share (EPS) from continuing operations.

The Company is forecasting revenue growth from 4% - 7%, with a neutral foreign exchange of 5% - 7% along with a 0.5% benefit from foreign exchange, for FY17. Lennox is estimating GAAP EPS from continuing operations of $7.67 - $7.97 compared to the earlier forecasts of $7.73 - $8.13. The Company also updated its guidance for adjusted EPS from continuing operations from $7.75 - $8.15 to $7.75 - $8.05.

Lennox also reiterated corporate expenses of approximately $85 million and capital expenditure of approximately $100 million.

Stock Performance

On Monday, October 30, 2017, the stock closed the trading session at $191.14, dropping 1.14% from its previous closing price of $193.34. A total volume of 229.52 thousand shares have exchanged hands. Lennox Intl.'s stock price soared 11.72% in the last three months, 15.52% in the past six months, and 30.54% in the previous twelve months. Furthermore, since the start of the year, shares of the Company have surged 24.79%. The stock is trading at a PE ratio of 26.91 and has a dividend yield of 1.07%. At Monday's closing price, the stock's net capitalization stands at $8.08 billion.

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