How much a stock's price changes over time is a significant driver for most investors. Not only can price performance impact your portfolio, but it can help you compare investment results across sectors and industries as well.
FOMO, or the fear of missing out, also plays a role in investing, particularly with tech giants and popular consumer-facing stocks.
What if you'd invested in Trane Technologies (TT) ten years ago? It may not have been easy to hold on to TT for all that time, but if you did, how much would your investment be worth today?
Trane Technologies' Business In-Depth
With that in mind, let's take a look at Trane Technologies' main business drivers.
Founded in 1885 and headquartered in Swords, Ireland, Trane Technologies is a designer, manufacturer, seller and servicer of climate control products for heating, ventilation, air conditioning and transport solutions. The company distributes its products through branch sales offices, dealers and distributors in the United States and through subsidiary sales and service companies in other parts of the world. Trane generated around 72% of its revenues from the United States and rest from more than 100 other countries. With no customer accounting for more than 10% of revenues, the company’s business does not depend on any single customer of group of customers.
As of Dec 31, 2023, Trane Technologies had roughly 40,000 employees in around 60 countries including roughly 15,000 outside of the United States. Roughly 25.9% of the company’s global employees are women and 37.2% of employees in the United States are racially and ethnically diverse. In 2023, 30.9% of new hires were women worldwide and 53% of new hires in the United States were racially and ethnically diverse. Trane continues to invest in research, development and other activities that it feels are necessary for improving its competitive position. It focuses on reduction of production cost, development of new products, enhancement of existing products and development of custom solutions for customers.
The company operates three regional segments which are also its reportable segments- Americas, EMEA and Asia Pacific. The Americas segment serves North American and Latin American customers with residential and commercial heating and cooling systems, energy services and solutions, building controls, and transport refrigeration systems and solutions. The segment generated $13.8 billion of revenues in 2023 (78% of total revenues). The EMEA segment serves customers in Europe, Middle East and Africa with heating and cooling systems, services and solutions for commercial buildings, and transport refrigeration systems and solutions. The segment generated $2.4 billion of revenues in 2023 (14% of total revenues). The Asia Pacific segment offers heating and cooling systems, services and solutions for commercial buildings, and transport refrigeration systems and solutions in the Asia Pacific region. The segment generated $1.4 billion of revenues in 2023 (8% of total revenues).
Bottom Line
While anyone can invest, building a lucrative investment portfolio takes research, patience, and a little bit of risk. If you had invested in Trane Technologies ten years ago, you're probably feeling pretty good about your investment today.
According to our calculations, a $1000 investment made in November 2014 would be worth $6,587.40, or a 558.74% gain, as of November 20, 2024. Investors should keep in mind that this return excludes dividends but includes price appreciation.
In comparison, the S&P 500 gained 188.81% and the price of gold went up 111.78% over the same time frame.
Analysts are forecasting more upside for TT too.
Trane Technologies benefits from its strong Commercial HVAC markets. It prioritizes improving its business operating system and innovation through business transformation initiatives and prudent investments. Trane has a track record of repurchasing shares and paying dividends consistently. Such moves instill investor confidence and positively impact the company's bottom line. Partly due to these tailwinds, the stock has risen 82.4% in the past year. On the flip side, product and service diversity puts Trane in the face of fierce competition in terms of price, quantity, delivery, service, support, technology and innovation. The company’s business remains exposed to seasonality and foreign currency exchange risks.
The stock is up 5.31% over the past four weeks, and no earnings estimate has gone lower in the past two months, compared to 7 higher, for fiscal 2024. The consensus estimate has moved up as well.Zacks' Research Chief Names "Stock Most Likely to Double"
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
