Trane Technologies plc (TT) Hits Fresh High: Is There Still Room to Run?

Company Performance - Trane Technologies' shares have increased by 14.6% over the past month and reached a new 52-week high of $398, with a year-to-date gain of 62.6% compared to 14.6% for the Zacks Business Services sector and 30.6% for the Zacks Technology Services industry [1] - The company has consistently exceeded earnings expectations, reporting EPS of$ 3.3 against a consensus estimate of $3.08 in its last earnings report on July 31, 2024 [2] Financial Projections - For the current fiscal year, Trane Technologies is projected to achieve earnings of$ 10.88 per share on revenues of $19.55 billion, reflecting a 20.35% increase in EPS and a 10.61% increase in revenues [3] - The next fiscal year is expected to see earnings of$ 12.30 per share on revenues of $20.95 billion, indicating year-over-year changes of 13.02% in EPS and 7.13% in revenues [3] Valuation Metrics - The stock trades at a valuation of 36.5X current fiscal year EPS estimates, which is higher than the peer industry average of 24.3X, and at 37.1X on a trailing cash flow basis compared to the peer group's average of 12.5X [7] - Trane Technologies has a PEG ratio of 2.73, which does not place it among the top echelon of stocks from a value perspective [7] Zacks Rank - Trane Technologies holds a Zacks Rank of 2 (Buy) due to rising earnings estimates, which is favorable for investors [8] - The company meets the criteria for selection based on Zacks Rank and Style Scores, suggesting potential for further share price appreciation in the near term [9] Industry Comparison - The Technology Services industry is positioned in the top 33% of all industries, indicating favorable conditions for both Trane Technologies and its peer, Cellebrite DI Ltd. [12] - Cellebrite DI Ltd. has a Zacks Rank of 2 (Buy) and has shown strong earnings performance, with a projected EPS of$ 0.41 on revenues of $395.67 million for the current fiscal year [10][11]