LII Stumbles on Q4 Expectations: Analyzing Lennox International's Recent Earnings Miss

Lennox International (LII) recently reported quarterly earnings that disappointed Wall Street, posting $4.45 per share against analyst expectations of $4.76 per share. This represents a notably different picture from the prior year when the HVAC equipment manufacturer delivered $5.60 per share. The 6.55% downside variance marks a significant deviation for a company that had posted better-than-expected results in the prior quarter with a $6.98 EPS against a $6.69 forecast.

The revenue side painted a similarly disappointing picture. LII reported quarterly revenues of $1.2 billion, falling approximately 5.88% short of consensus forecasts. Year-over-year, this reflected a decline from the $1.35 billion posted in the December 2024 quarter. Over the most recent four-quarter span, Lennox has managed to beat consensus expectations just twice—a trend that suggests mounting pressure on the company’s operational performance.

The Estimate Revision Problem: Why Numbers Matter More Than They Appear

One critical factor that investors often overlook is how earnings expectations shift in the days and weeks leading up to earnings reports. For LII, the trend heading into this earnings release was decidedly unfavorable. Estimate revisions—whether upward or downward—have historically shown a strong correlation with near-term stock movements. This dynamic directly influences analyst ratings and stock recommendations.

Following the earnings release, the estimate revision landscape for Lennox International remains challenged. The company currently carries a Zacks Rank #4 rating, categorized as “Sell,” suggesting that near-term market performance could lag the broader indexes. The consensus EPS expectation for the upcoming quarter stands at $3.41, based on projected revenues of $1.11 billion. Looking at the full fiscal year, analysts anticipate $24.70 in earnings per share on $5.63 billion in total revenues.

Industry Backdrop: A Mixed Picture for Building Products

LII operates within the Building Products - Air Conditioner and Heating sector, which currently ranks in the top 41% of more than 250 Zacks-tracked industries. Historical analysis demonstrates that industries in the top 50% performance tier outpace the bottom half by a factor exceeding 2-to-1, so this positioning provides some structural support for the company.

Peer performance offers additional context. SPX Technologies (SPXC), another infrastructure equipment supplier in the same space, is scheduled to report December 2025 quarterly results on February 24. Analysts expect SPX to deliver $1.86 in EPS—a 23.2% year-over-year increase—with revenues projected at $627.44 million, up 17.6% from the prior-year quarter. Notably, SPX’s consensus EPS estimate has been revised 0.2% higher over the past 30 days, indicating more constructive sentiment compared to LII’s downward revision pressure.

What Comes Next for Lennox International Stock?

Since the start of 2026, LII shares have appreciated approximately 2.7%, slightly outpacing the S&P 500’s 1.9% gain. However, the earnings miss and associated estimate cuts raise questions about whether this outperformance can persist. The immediate price action will depend largely on how management addresses the shortfall during the earnings call and what forward guidance they provide.

The key takeaway for investors tracking LII: earnings estimate revisions represent one of the most reliable predictors of stock price movements in the weeks ahead. With unfavorable revisions already in place and a “Sell” rating from major research platforms, the near-term technical setup appears challenging for Lennox International shareholders. The company’s ability to stabilize estimates and deliver on upcoming quarter guidance will likely prove decisive for investor sentiment.