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TT trades against a final fair-value range of $236.15-$427.31, with the midpoint set by the accepted valuation synthesis rather than earlier draft model outputs.
A severe macro contraction combined with raw material inflation tests pricing power. Given the extreme premium valuation, any sequential backlog decline or book-to-bill ratio slipping below 1.0x triggers an immediate multiple de-rating.
Sustained downturn in commercial real estate sharply reduces new HVAC installations and stalls aftermarket retrofit volume.
Intensified competition forces pricing concessions, failing to offset supply chain and input cost inflation, stalling margin expansion.
Reversals on global decarbonization mandates and energy efficiency subsidies remove the primary non-cyclical growth override.
| Line item | 2022-12-31 | 2023-12-31 | 2024-12-31 | 2025-12-31 | Trend |
|---|---|---|---|---|---|
| Revenue | $15.99B | $17.68B+10.6% | $19.84B+12.2% | $21.32B+7.5% | +10.1% |
| Gross profit | $4.96B | $5.86B | $7.08B | $7.71B | +15.8% |
| Operating income | $2.42B | $2.89B | $3.50B | $3.97B | +17.9% |
| Net income | $1.76B | $2.02B+14.8% | $2.57B+27.2% | $2.92B+13.6% | +18.4% |
| EPS (diluted) | $7.48 | $8.77 | $11.24 | $12.98 | +20.2% |
| EBITDA | $2.72B | $3.15B | $3.86B | $4.28B | +16.3% |
| R&D | — | — | — | — | — |
| SG&A | $2.55B | $2.96B | $3.58B | $3.74B | +13.7% |
Cash-flow quality is reflected in the OCFOperating cash flowCash generated from the company's core operations after working-capital changes but before capital expenditures. The first line of the cash-flow statement. / net incomeNet IncomeNet Income is an income-statement line item used to reconcile revenue to operating profit, pre-tax income, net income, or per-share earnings. It should be compared across periods and against peer disclosure conventions., accounting-quality, and ROICROICReturn on invested capital. Operating profit (after tax) divided by invested capital. The single best gauge of capital-efficiency. Spread over WACC = economic value created. rows above.
Capital allocation should be evaluated against reinvestment needs, balance-sheet strength, and shareholder returns.
| Deterioration versus the report thesis |
| Deceleration in aftermarket service revenue growth. | Monitor | Deterioration versus the report thesis |
| Erosion of OCF-to-NI conversion below 1.0x. | Monitor | Deterioration versus the report thesis |
