Stock fact sheet · data as of
Lennox International Inc. (LII): fair value, margin of safety and Wheel Score
Industrials · Industrial - Machinery · United States · Value
Is LII undervalued?
At 358.50 (close of 16 Oct 2026), LII trades 25% under the GLS average fair value of 480.26. 5 of the 9 models that produced a value land above the price. A discount of this size counts as a positive margin of safety in every GLS screen; whether it is enough depends on the rest of the picture - the health score, the moat and the option premium below.
The 9 models disagree widely: DDM gives 78.28 while GLS Growth gives 1,366.43. A spread that wide means the average is sensitive to which methods you trust; the model table below shows where each one lands, and the Quote page lets you switch any of them off.
The nightly engine files LII under Value: positive earnings at a P/E of 18 or less.
Nine valuation models for LII
Each model turns the latest filed numbers into a value per share; the GLS fair value is the simple average of the ones that produce a positive number. The last two rows are shown for reference and never enter the average. The Quote page lets you switch any model off and add your own margin of safety.
| Model | Value | vs price | What it measures |
|---|---|---|---|
| DCF | 368.72 | +3% | Present value of the projected free cash flows, discounted at the cost of capital |
| Graham Number | 137.02 | -62% | The most a defensive investor pays for the earnings and book value per share |
| Graham Growth | 538.50 | +50% | Graham's growth formula: EPS × (8.5 + 2 × growth), adjusted for bond yields |
| Lynch | 180.51 | -50% | EPS × the earnings growth rate (PEG of 1), growth capped at 25% |
| GLS Growth | 1,366.43 | +281% | EPS compounded ten years at the blended growth rate, discounted back at 15% a year |
| 10 Cap | 561.96 | +57% | Owner's earnings (operating cash flow less maintenance capex) capitalised at 10% |
| Payback Time | 842.97 | +135% | Eight years of compounded free cash flow: the price at which the business pays for itself |
| DDM | 78.28 | -78% | Dividend discount model: next year's dividend ÷ (10% − 3% growth); needs a dividend |
| EPV | 248.00 | -31% | Earnings power value: current EPS capitalised at 9% with no growth |
| Zombie (liquidation) | -29.37 | -108% | Current assets less all liabilities, per share: the balance-sheet floor. Not in the average |
| Wall St target | 489.40 | +37% | Analysts' average 12-month price target. Not in the average |
Quality and financial health
On financial health LII scores 7/9 (Piotroski): most of the nine tests - positive earnings and cash flow, falling debt, rising margins and turnover - are passed, which is the kind of balance sheet a wheel trader is happy to be assigned. The GLS Moat score is 5.6 out of 10: a ten-year record that is consistent in some of the metrics the score tracks (revenue, earnings, margins, cash flow, returns on capital) and patchy in others.
Returns on capital are high - ROIC 25.0%, ROE 69.3%, ROA 19.7% - with debt at 1.77 times equity and a free-cash-flow yield of 6.0%.
The dividend yield is 1.48% with a payout ratio of 27% - a small yield that leaves most of the earnings in the business. Revenue comes mainly from Residential Heating and Cooling 61%, Commercial Heating and Cooling 40% (quarter Q2 FY2026).
Institutional ownership scores 10/10, insider activity 1/10 and Congressional trading 7/10 on the GLS smart-money scales; the last recorded Congressional buy was on 10 Aug 2026.
| Piotroski F-score | 7 / 9 | ROIC | 25.0% |
|---|---|---|---|
| GLS Moat | 5.6 / 10 | ROE | 69.3% |
| Debt / equity | 1.77 | ROA | 19.7% |
| Free-cash-flow yield | 6.0% | Payout ratio | 27% |
| Institutions | 10 / 10 | Insiders · Congress | 1 · 7 / 10 |
Wheel Score 85: Prime
LII scores 85 out of 100 on the Wheel Score, in the Prime band (80 and above), which fewer than one stock in twenty reaches on any night. The score blends five things a wheel trader checks before selling a cash-secured put: the margin of safety (Value, 23/25), Piotroski health (16/20), the GLS moat (8/15), the option premium on offer (20/20) and how easily the stock trades (18/20).
Implied volatility is 44% on the near-the-money contracts 20-60 days out - inside the 35-60% range the Wheel Score pays full marks for: enough premium to be worth selling, not so much that the risk is unpaid. Chain open interest is thin - 1,994 contracts across every expiry - so fills at a fair price are not guaranteed; a 30-45-day put may not exist at a usable strike.
Volume runs at 903k shares a day on a market cap of $12.4B, with a beta of 1.16; the Stability part of the Wheel Score gives that 18 of 20.
| Part | Points | From | |
|---|---|---|---|
| Value | 23 / 25 | 25% margin of safety | |
| Health | 16 / 20 | Piotroski 7/9 | |
| Moat | 8 / 15 | moat 5.6/10 | |
| Premium | 20 / 20 | implied volatility 44% | |
| Stability | 18 / 20 | 903k shares/day, $12.4B cap, beta 1.16 |
The Wheel Score ranks ~7,400 US stocks for selling cash-secured puts and covered calls; it is updated nightly and is not a recommendation. The walkthrough lesson shows how the score fits into a trade, start to finish.
Upcoming events
Lennox International Inc. reports earnings on 28 Oct 2026 (before the open) - inside the 14-day window the Sunday Scan avoids, because a put sold now would carry the report's gap risk.
Earnings, dividend, IPO, split and economic calendars for the whole market, filterable to your watchlists.
Similar stocks in Industrial - Machinery
The 12 companies below are the closest to Lennox International Inc. by market cap within the Industrial - Machinery industry, each with its own fact sheet; the Compare page puts up to eight of them side by side.
| Stock | Close | Fair value | MoS | Wheel | Mkt cap |
|---|---|---|---|---|---|
| INIO INNIO N.V. Ordinary Shares | 16.50 | 6.18 | -167% | 40Weak | $12.4B |
| CR Crane Company | 205.73 | 95.92 | -114% | 51Fair | $11.9B |
| MAIR Madison Air Solutions Corporation | 23.47 | 4.80 | -389% | 42Weak | $11.8B |
| WTS Watts Water Technologies, Inc. | 352.10 | 189.99 | -85% | 61Fair | $11.8B |
| GNRC Generac Holdings Inc. | 198.40 | 143.86 | -38% | 58Fair | $11.7B |
| GGG Graco Inc. | 81.78 | 53.01 | -54% | 61Fair | $13.2B |
| RRX Regal Rexnord Corporation | 157.06 | 118.20 | -33% | 64Fair | $10.5B |
| DCI Donaldson Company, Inc. | 87.77 | 57.36 | -53% | 61Fair | $10.2B |
| FLS Flowserve Corporation | 70.77 | 69.84 | -1% | 74Good | $9.0B |
| IEX IDEX Corporation | 236.42 | 123.83 | -91% | 60Fair | $17.4B |
| ITT ITT Inc. | 201.04 | 129.35 | -55% | 58Fair | $18.0B |
| NDSN Nordson Corporation | 328.80 | 162.22 | -103% | 55Fair | $18.3B |
Screen the whole market the same way
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Start free See the Sunday ScanQuestions about LII
Is LII undervalued right now?
By the GLS models, moderately: at 358.50 the stock trades 25% below the average fair value of 480.26 (data as of 16 Oct 2026).
What is the Wheel Score of LII and what does it mean?
LII scores 85 out of 100 (Prime). The Wheel Score blends the margin of safety (25 points), Piotroski health (20), the GLS moat (15), the option premium on offer (20) and trading stability (20) into one number that ranks stocks for the wheel strategy - selling cash-secured puts, then covered calls if assigned. 80 and above is Prime, 65-79 Good, 50-64 Fair, under 50 Weak.
What is the GLS fair value for LII?
480.26 per share as of 16 Oct 2026 - the simple average of the 9 valuation models (out of nine: DCF, Graham Number, Graham Growth, Lynch, GLS Growth, 10 Cap, Payback Time, DDM and EPV) that produced a positive value. The models run every night on the latest filings; the Quote page lets you switch any of them off and add a margin of safety of your own.
When does Lennox International Inc. report earnings next?
The next earnings report is due on 28 Oct 2026 (before the open), 12 days from the data date of 16 Oct 2026. The Calendars page lists every upcoming report with its time of day.
Does LII have listed options, and how liquid are they?
Yes. The nightly snapshot found 462 listed contracts with 1,994 open interest across all expiries and implied volatility of 44% on the near-the-money contracts. The Options scanner lists the cash-secured put and covered call set-ups with premium and annualised yield worked out.