A Look Back at HVAC and Water Systems Stocks’ Q3 Earnings: Trane Technologies (NYSE:TT) Vs The Rest Of The Pack

The end of the earnings season is always a good time to take a step back and see who shined (and who not so much). Let’s take a look at how hvac and water systems stocks fared in Q3, starting with Carrier Global .

Many HVAC and water systems companies sell essential, non-discretionary infrastructure for buildings. Since the useful lives of these water heaters and vents are fairly standard, these companies have a portion of predictable replacement revenue. In the last decade, trends in energy efficiency and clean water are driving innovation that is leading to incremental demand. On the other hand, new installations for these companies are at the whim of residential and commercial construction volumes, which tend to be cyclical and can be impacted heavily by economic factors such as interest rates.

The 9 hvac and water systems stocks we track reported a strong Q3. As a group, revenues beat analysts’ consensus estimates by 3.6% while next quarter’s revenue guidance was 0.8% below.

In light of this news, share prices of the companies have held steady as they are up 4.4% on average since the latest earnings results.

Carrier Global

Founded by the inventor of air conditioning, Carrier Global manufactures heating, ventilation, air conditioning, and refrigeration products.

Carrier Global reported revenues of $5.58 billion, down 6.8% year on year. This print was in line with analysts’ expectations, and overall, it was a very strong quarter for the company with an impressive beat of analysts’ EBITDA estimates.

"Our team drove continued double-digit aftermarket growth and strong performance in Commercial HVAC1, which grew 30% in the Americas, both of which were more than offset by expected weakness in Residential in the Americas," said Chairman & CEO David Gitlin.

Carrier Global achieved the highest full-year guidance raise but had the slowest revenue growth of the whole group. Investor expectations, however, were likely higher than Wall Street’s published projections, leaving some wishing for even better results (analysts’ consensus estimates are those published by big banks and advisory firms, not the investors who make buy and sell decisions). The stock is down 3.4% since reporting and currently trades at $56.33.

Best Q3: Northwest Pipe

Playing a large role in the Integrated Pipeline (IPL) project in Texas to deliver ~350 million gallons of water per day, Northwest Pipe is a manufacturer of pipeline systems for water infrastructure.

Northwest Pipe reported revenues of $151.1 million, up 16% year on year, outperforming analysts’ expectations by 14.4%. The business had an incredible quarter with a beat of analysts’ EPS and EBITDA estimates.

Northwest Pipe pulled off the biggest analyst estimates beat among its peers. The market seems happy with the results as the stock is up 16.7% since reporting. It currently trades at $64.98.

Weakest Q3: Lennox

Based in Texas and founded over a century ago, Lennox is a climate control solutions company offering heating, ventilation, air conditioning, and refrigeration (HVACR) goods.

Lennox reported revenues of $1.43 billion, down 4.8% year on year, falling short of analysts’ expectations by 3.9%. It was a slower quarter as it posted a significant miss of analysts’ revenue estimates.

Lennox delivered the weakest performance against analyst estimates in the group. As expected, the stock is down 3.4% since the results and currently trades at $530.15.

Read our full analysis of Lennox’s results here.

CSW (NASDAQ:CSW)

With over two centuries of combined operations manufacturing and supplying, CSW (NASDAQ:CSW) offers special chemicals, coatings, sealants, and lubricants for various industries.

CSW reported revenues of $277 million, up 21.5% year on year. This result missed analysts’ expectations by 0.5%. Zooming out, it was a mixed quarter as it also produced a beat of analysts’ EPS estimates but a slight miss of analysts’ revenue estimates.

CSW delivered the fastest revenue growth among its peers. The stock is up 30.9% since reporting and currently trades at $319.35.

Read our full, actionable report on CSW here, it’s free.

Trane Technologies

With low-pressure heating systems as its first product, Trane designs, manufactures, and sells HVAC and refrigeration systems, the former to commercial and residential building customers and the latter to commercial truck manufacturers.

Trane Technologies reported revenues of $5.74 billion, up 5.5% year on year. This print lagged analysts' expectations by 0.9%. Taking a step back, it was a satisfactory quarter as it also recorded an impressive beat of analysts’ adjusted operating income estimates but a slight miss of analysts’ revenue estimates.

The stock is down 10.7% since reporting and currently trades at $381.75.

Read our full, actionable report on Trane Technologies here, it’s free.

As the Q3 earnings season wraps, let’s dig into this quarter’s best and worst performers in the hvac and water systems industry, including Northwest Pipe and its peers.

Many HVAC and water systems companies sell essential, non-discretionary infrastructure for buildings. Since the useful lives of these water heaters and vents are fairly standard, these companies have a portion of predictable replacement revenue. In the last decade, trends in energy efficiency and clean water are driving innovation that is leading to incremental demand. On the other hand, new installations for these companies are at the whim of residential and commercial construction volumes, which tend to be cyclical and can be impacted heavily by economic factors such as interest rates.

The 9 hvac and water systems stocks we track reported a strong Q3. As a group, revenues beat analysts’ consensus estimates by 3.6% while next quarter’s revenue guidance was 0.8% below.

In light of this news, share prices of the companies have held steady as they are up 2.1% on average since the latest earnings results.

Best Q3: Northwest Pipe

Playing a large role in the Integrated Pipeline (IPL) project in Texas to deliver ~350 million gallons of water per day, Northwest Pipe is a manufacturer of pipeline systems for water infrastructure.

Northwest Pipe reported revenues of $151.1 million, up 16% year on year. This print exceeded analysts’ expectations by 14.4%. Overall, it was an incredible quarter for the company with a beat of analysts’ EPS and EBITDA estimates.

"We delivered our strongest quarter in Company history, achieving consolidated revenue of $151.1 million, up 13.4% compared to the previous quarter, and a gross margin of 21.3%, reflecting 230 basis points of sequential quarter margin expansion," said Scott Montross, President and Chief Executive Officer of NWPX Infrastructure, Inc.

Northwest Pipe pulled off the biggest analyst estimates beat of the whole group. Unsurprisingly, the stock is up 13.2% since reporting and currently trades at $63.05.

AAON

Backed by two million square feet of lab testing space, AAON makes heating, ventilation, and air conditioning equipment for different types of buildings.

AAON reported revenues of $384.2 million, up 17.4% year on year, outperforming analysts’ expectations by 13.8%. The business had an exceptional quarter with an impressive beat of analysts’ revenue and EPS estimates.

The market seems unhappy with the results as the stock is down 14.8% since reporting. It currently trades at $79.67.

Weakest Q3: Lennox

Based in Texas and founded over a century ago, Lennox is a climate control solutions company offering heating, ventilation, air conditioning, and refrigeration (HVACR) goods.

Lennox reported revenues of $1.43 billion, down 4.8% year on year, falling short of analysts’ expectations by 3.9%. It was a slower quarter as it posted a significant miss of analysts’ revenue estimates.

Lennox delivered the weakest performance against analyst estimates in the group. As expected, the stock is down 5.6% since the results and currently trades at $518.48.

Read our full analysis of Lennox’s results here.

Trane Technologies

With low-pressure heating systems as its first product, Trane designs, manufactures, and sells HVAC and refrigeration systems, the former to commercial and residential building customers and the latter to commercial truck manufacturers.

Trane Technologies reported revenues of $5.74 billion, up 5.5% year on year. This print lagged analysts' expectations by 0.9%. Zooming out, it was a satisfactory quarter as it also recorded an impressive beat of analysts’ adjusted operating income estimates but a slight miss of analysts’ revenue estimates.

The stock is down 11.7% since reporting and currently trades at $377.42.

Read our full, actionable report on Trane Technologies here, it’s free.

Carrier Global

Founded by the inventor of air conditioning, Carrier Global manufactures heating, ventilation, air conditioning, and refrigeration products.

Carrier Global reported revenues of $5.58 billion, down 6.8% year on year. This number met analysts’ expectations. Overall, it was a very strong quarter as it also logged a solid beat of analysts’ EBITDA estimates and an impressive beat of analysts’ adjusted operating income estimates.

Carrier Global delivered the highest full-year guidance raise but had the slowest revenue growth among its peers. The stock is down 7% since reporting and currently trades at $54.23.

Read our full, actionable report on Carrier Global here, it’s free.

The end of an earnings season can be a great time to discover new stocks and assess how companies are handling the current business environment. Let’s take a look at how AAON and the rest of the hvac and water systems stocks fared in Q3.

Many HVAC and water systems companies sell essential, non-discretionary infrastructure for buildings. Since the useful lives of these water heaters and vents are fairly standard, these companies have a portion of predictable replacement revenue. In the last decade, trends in energy efficiency and clean water are driving innovation that is leading to incremental demand. On the other hand, new installations for these companies are at the whim of residential and commercial construction volumes, which tend to be cyclical and can be impacted heavily by economic factors such as interest rates.

The 9 hvac and water systems stocks we track reported a strong Q3. As a group, revenues beat analysts’ consensus estimates by 3.6% while next quarter’s revenue guidance was 0.8% below.

In light of this news, share prices of the companies have held steady as they are up 2.1% on average since the latest earnings results.

AAON

Backed by two million square feet of lab testing space, AAON makes heating, ventilation, and air conditioning equipment for different types of buildings.

AAON reported revenues of $384.2 million, up 17.4% year on year. This print exceeded analysts’ expectations by 13.8%. Overall, it was an exceptional quarter for the company with a solid beat of analysts’ revenue and EPS estimates.

"Our third quarter results demonstrate the enduring demand for our products and reflect continued share gains, margin improvement and steady progress toward our operational goals, with notable sequential improvement in several key areas," said AAON President and CEO Matt Tobolski.

Unsurprisingly, the stock is down 11.7% since reporting and currently trades at $82.50.

Best Q3: Northwest Pipe

Playing a large role in the Integrated Pipeline (IPL) project in Texas to deliver ~350 million gallons of water per day, Northwest Pipe is a manufacturer of pipeline systems for water infrastructure.

Northwest Pipe reported revenues of $151.1 million, up 16% year on year, outperforming analysts’ expectations by 14.4%. The business had an incredible quarter with a beat of analysts’ EPS and EBITDA estimates.

Northwest Pipe scored the biggest analyst estimates beat among its peers. The market seems happy with the results as the stock is up 14.8% since reporting. It currently trades at $63.95.

Weakest Q3: Lennox

Based in Texas and founded over a century ago, Lennox is a climate control solutions company offering heating, ventilation, air conditioning, and refrigeration (HVACR) goods.

Lennox reported revenues of $1.43 billion, down 4.8% year on year, falling short of analysts’ expectations by 3.9%. It was a slower quarter as it posted a significant miss of analysts’ revenue estimates.

Lennox delivered the weakest performance against analyst estimates in the group. As expected, the stock is down 5.3% since the results and currently trades at $519.84.

Read our full analysis of Lennox’s results here.

Trane Technologies

With low-pressure heating systems as its first product, Trane designs, manufactures, and sells HVAC and refrigeration systems, the former to commercial and residential building customers and the latter to commercial truck manufacturers.

Trane Technologies reported revenues of $5.74 billion, up 5.5% year on year. This number lagged analysts' expectations by 0.9%. Taking a step back, it was a satisfactory quarter as it also recorded an impressive beat of analysts’ adjusted operating income estimates but a slight miss of analysts’ revenue estimates.

The stock is down 11.2% since reporting and currently trades at $379.60.

Read our full, actionable report on Trane Technologies here, it’s free for active Edge members.

Advanced Drainage

Originally started as a farm water drainage company, Advanced Drainage Systems provides clean water management solutions to communities across America.

Advanced Drainage reported revenues of $850.4 million, up 8.7% year on year. This print topped analysts’ expectations by 6.6%. It was an exceptional quarter as it also logged a solid beat of analysts’ EBITDA estimates.

Advanced Drainage had the weakest full-year guidance update among its peers. The stock is up 11% since reporting and currently trades at $149.54.

Read our full, actionable report on Advanced Drainage here, it’s free for active Edge members.

Let’s dig into the relative performance of Lennox and its peers as we unravel the now-completed Q3 hvac and water systems earnings season.

Many HVAC and water systems companies sell essential, non-discretionary infrastructure for buildings. Since the useful lives of these water heaters and vents are fairly standard, these companies have a portion of predictable replacement revenue. In the last decade, trends in energy efficiency and clean water are driving innovation that is leading to incremental demand. On the other hand, new installations for these companies are at the whim of residential and commercial construction volumes, which tend to be cyclical and can be impacted heavily by economic factors such as interest rates.

The 9 hvac and water systems stocks we track reported a strong Q3. As a group, revenues beat analysts’ consensus estimates by 3.6% while next quarter’s revenue guidance was 0.8% below.

In light of this news, share prices of the companies have held steady. On average, they are relatively unchanged since the latest earnings results.

Weakest Q3: Lennox

Based in Texas and founded over a century ago, Lennox is a climate control solutions company offering heating, ventilation, air conditioning, and refrigeration (HVACR) goods.

Lennox reported revenues of $1.43 billion, down 4.8% year on year. This print fell short of analysts’ expectations by 3.9%. Overall, it was a slower quarter for the company with a significant miss of analysts’ revenue estimates.

"As anticipated, 2025 is proving to be a transitional year, shaped by the impact of the refrigerant transition and difficult macroeconomic conditions. During these uncertain times, the Lennox team continues to respond with agility and discipline, delivering margin expansion in both segments," said CEO, Alok Maskara.

Lennox delivered the weakest performance against analyst estimates of the whole group. Unsurprisingly, the stock is down 8.6% since reporting and currently trades at $501.56.

Best Q3: Northwest Pipe

Playing a large role in the Integrated Pipeline (IPL) project in Texas to deliver ~350 million gallons of water per day, Northwest Pipe is a manufacturer of pipeline systems for water infrastructure.

Northwest Pipe reported revenues of $151.1 million, up 16% year on year, outperforming analysts’ expectations by 14.4%. The business had an incredible quarter with a beat of analysts’ EPS estimates and a solid beat of analysts’ EBITDA estimates.

Northwest Pipe pulled off the biggest analyst estimates beat among its peers. The market seems happy with the results as the stock is up 13.2% since reporting. It currently trades at $63.02.

A. O. Smith

Credited with the invention of the glass-lined water heater, A.O. Smith manufactures water heating and treatment products for various industries.

A. O. Smith reported revenues of $942.5 million, up 4.4% year on year, in line with analysts’ expectations. It was a slower quarter as it posted full-year revenue guidance missing analysts’ expectations and full-year EPS guidance missing analysts’ expectations.

The stock is flat since the results and currently trades at $68.24.

Read our full analysis of A. O. Smith’s results here.

Zurn Elkay

Claiming to have saved more than 30 billion gallons of water, Zurn Elkay provides water management solutions to various industries.

Zurn Elkay reported revenues of $455.4 million, up 11.1% year on year. This number topped analysts’ expectations by 3%. It was a very strong quarter as it also recorded an impressive beat of analysts’ adjusted operating income estimates and a solid beat of analysts’ revenue estimates.

The stock is up 1.7% since reporting and currently trades at $46.84.

Read our full, actionable report on Zurn Elkay here, it’s free for active Edge members.

Advanced Drainage

Originally started as a farm water drainage company, Advanced Drainage Systems provides clean water management solutions to communities across America.

Advanced Drainage reported revenues of $850.4 million, up 8.7% year on year. This print beat analysts’ expectations by 6.6%. Overall, it was an exceptional quarter as it also produced an impressive beat of analysts’ EBITDA estimates and a solid beat of analysts’ adjusted operating income estimates.

Advanced Drainage had the weakest full-year guidance update among its peers. The stock is up 11% since reporting and currently trades at $149.53.

Read our full, actionable report on Advanced Drainage here, it’s free for active Edge members.

Let’s dig into the relative performance of Advanced Drainage and its peers as we unravel the now-completed Q3 hvac and water systems earnings season.

Many HVAC and water systems companies sell essential, non-discretionary infrastructure for buildings. Since the useful lives of these water heaters and vents are fairly standard, these companies have a portion of predictable replacement revenue. In the last decade, trends in energy efficiency and clean water are driving innovation that is leading to incremental demand. On the other hand, new installations for these companies are at the whim of residential and commercial construction volumes, which tend to be cyclical and can be impacted heavily by economic factors such as interest rates.

The 9 hvac and water systems stocks we track reported a strong Q3. As a group, revenues beat analysts’ consensus estimates by 3.6% while next quarter’s revenue guidance was 0.8% below.

In light of this news, share prices of the companies have held steady as they are up 1.2% on average since the latest earnings results.

Advanced Drainage

Originally started as a farm water drainage company, Advanced Drainage Systems provides clean water management solutions to communities across America.

Advanced Drainage reported revenues of $850.4 million, up 8.7% year on year. This print exceeded analysts’ expectations by 6.6%. Overall, it was an exceptional quarter for the company with a solid beat of analysts’ EBITDA estimates and an impressive beat of analysts’ adjusted operating income estimates.

Scott Barbour, President and Chief Executive Officer of ADS commented, "We delivered strong results in the second quarter, a testament to the key sales strategies we have executed to drive growth in core markets. Revenue from both Infiltrator and Allied products increased double digits compared to the prior year. This growth, in conjunction with favorable price/cost, end market and product mix resulted in a highly-resilient Adjusted EBITDA margin of 33.8%."

Advanced Drainage delivered the weakest full-year guidance update of the whole group. Interestingly, the stock is up 10.4% since reporting and currently trades at $148.71.

Best Q3: Northwest Pipe

Playing a large role in the Integrated Pipeline (IPL) project in Texas to deliver ~350 million gallons of water per day, Northwest Pipe is a manufacturer of pipeline systems for water infrastructure.

Northwest Pipe reported revenues of $151.1 million, up 16% year on year, outperforming analysts’ expectations by 14.4%. The business had an incredible quarter with a beat of analysts’ EPS and EBITDA estimates.

Northwest Pipe pulled off the biggest analyst estimates beat among its peers. The market seems happy with the results as the stock is up 13.4% since reporting. It currently trades at $63.16.

Weakest Q3: Lennox

Based in Texas and founded over a century ago, Lennox is a climate control solutions company offering heating, ventilation, air conditioning, and refrigeration (HVACR) goods.

Lennox reported revenues of $1.43 billion, down 4.8% year on year, falling short of analysts’ expectations by 3.9%. It was a slower quarter as it posted a significant miss of analysts’ revenue estimates.

Lennox delivered the weakest performance against analyst estimates in the group. As expected, the stock is down 9.5% since the results and currently trades at $496.58.

Read our full analysis of Lennox’s results here.

A. O. Smith

Credited with the invention of the glass-lined water heater, A.O. Smith manufactures water heating and treatment products for various industries.

A. O. Smith reported revenues of $942.5 million, up 4.4% year on year. This number was in line with analysts’ expectations. Taking a step back, it was a slower quarter as it logged full-year revenue guidance missing analysts’ expectations and full-year EPS guidance missing analysts’ expectations.

The stock is flat since reporting and currently trades at $68.07.

Read our full, actionable report on A. O. Smith here, it’s free for active Edge members.

Carrier Global

Founded by the inventor of air conditioning, Carrier Global manufactures heating, ventilation, air conditioning, and refrigeration products.

Carrier Global reported revenues of $5.58 billion, down 6.8% year on year. This result met analysts’ expectations. Overall, it was a very strong quarter as it also produced a solid beat of analysts’ EBITDA estimates and an impressive beat of analysts’ adjusted operating income estimates.

Carrier Global achieved the highest full-year guidance raise but had the slowest revenue growth among its peers. The stock is down 8% since reporting and currently trades at $53.64.

Read our full, actionable report on Carrier Global here, it’s free for active Edge members.