TT Valuation

Trane Technologies PLC

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422.270

-4.03(-0.945%)1D

Overview
Forecast
Valuation
Earnings

TT Relative Valuation

TT's fair value is calculated using relative valuation, based on historical P/E and P/S ranges and their premiums/discounts relative to a competitor average, adjusted by weights. If the market price exceeds this fair value range, TT is overvalued; if below, it's undervalued.

Historical Valuation

Trane Technologies PLC (TT) is now in the Overvalued zone, suggesting that its current forward PE ratio of 30.63 is considered Overvalued compared with the five-year average of 25.49. The fair price of Trane Technologies PLC (TT) is between 308.28 to 406.31 according to relative valuation methord. Compared to the current price of 422.27 USD , Trane Technologies PLC is Overvalued By 3.93%.

Relative Value

Fair Zone

308.28-406.31

Current Price：422.27

3.93%

Overvalued

30.63

Trailing

Forward

21.68

EV/EBITDA

Trane Technologies PLC. (TT) has a current EV/EBITDA of 21.68. The 5-year average EV/EBITDA is 17.49. The thresholds are as follows: Strongly Undervalued below 11.60, Undervalued between 11.60 and 14.54, Fairly Valued between 20.43 and 14.54, Overvalued between 20.43 and 23.38, and Strongly Overvalued above 23.38. The current Forward EV/EBITDA of 21.68 falls within the Overvalued range.

23.68

EV/EBIT

Trane Technologies PLC. (TT) has a current EV/EBIT of 23.68. The 5-year average EV/EBIT is 19.59. The thresholds are as follows: Strongly Undervalued below 13.34, Undervalued between 13.34 and 16.47, Fairly Valued between 22.72 and 16.47, Overvalued between 22.72 and 25.85, and Strongly Overvalued above 25.85. The current Forward EV/EBIT of 23.68 falls within the Overvalued range.

4.24

Trane Technologies PLC. (TT) has a current PS of 4.24. The 5-year average PS is 2.97. The thresholds are as follows: Strongly Undervalued below 1.52, Undervalued between 1.52 and 2.25, Fairly Valued between 3.70 and 2.25, Overvalued between 3.70 and 4.43, and Strongly Overvalued above 4.43. The current Forward PS of 4.24 falls within the Overvalued range.

27.45

P/OCF

Trane Technologies PLC. (TT) has a current P/OCF of 27.45. The 5-year average P/OCF is 22.81. The thresholds are as follows: Strongly Undervalued below 10.44, Undervalued between 10.44 and 16.62, Fairly Valued between 29.00 and 16.62, Overvalued between 29.00 and 35.18, and Strongly Overvalued above 35.18. The current Forward P/OCF of 27.45 falls within the Historic Trend Line -Fairly Valued range.

30.45

P/FCF

Trane Technologies PLC. (TT) has a current P/FCF of 30.45. The 5-year average P/FCF is 25.63. The thresholds are as follows: Strongly Undervalued below 11.85, Undervalued between 11.85 and 18.74, Fairly Valued between 32.52 and 18.74, Overvalued between 32.52 and 39.41, and Strongly Overvalued above 39.41. The current Forward P/FCF of 30.45 falls within the Historic Trend Line -Fairly Valued range.

Trane Technologies PLC (TT) has a current Price-to-Book (P/B) ratio of 12.12. Compared to its 3-year average P/B ratio of 9.12 , the current P/B ratio is approximately 32.81% higher. Relative to its 5-year average P/B ratio of 7.90, the current P/B ratio is about 53.39% higher. Trane Technologies PLC (TT) has a Forward Free Cash Flow (FCF) yield of approximately 2.96%. Compared to its 3-year average FCF yield of 3.17%, the current FCF yield is approximately -6.42% lower. Relative to its 5-year average FCF yield of 3.42% , the current FCF yield is about -13.36% lower.

12.12

P/B

Median3y

9.12

Median5y

7.90

2.96

FCF Yield

Median3y

3.17

Median5y

3.42

Competitors Valuation Multiple

The average P/S ratio for TT's competitors is 4.02, providing a benchmark for relative valuation. Trane Technologies PLC Corp (TT) exhibits a P/S ratio of 4.24, which is 5.26% above the industry average. Given its robust revenue growth of 8.27%, this premium appears unsustainable.

P/S

P/E

EV/EBITDA

EV/EBIT

P/S

Revenue Growth

Market Cap

TT.N

Trane Technologies PLC

Johnson Controls International PLC

Applied Materials Inc

Performance Decomposition

Market capitalization of TT increased by 17.05% over the past 1 year. The primary factor behind the change was an increase in Revenue Growth from 5.31B to 5.75B.

The secondary factor is the Margin Expansion, contributed 5.47%to the performance.

Overall, the performance of TT in the past 1 year is driven by Revenue Growth. Which is more sustainable.

8.27%

5.31B → 5.75B

Revenue Growth

5.47%

14.45 → 15.24

Margin Expansion

3.31%

32.54 → 33.62

P/E Change

17.05%