Trane Technologies plc (TT) Valuation

Valuation

Model-based estimates, not advice. The DCF is the discounted-cash-flow value per share; compare it with the price, not as a target.

DCF fair value

-37.8%

$256.21

vs $411.66 price

Levered DCF

$282.36

After debt service

Piotroski score

5 / 9

Average

Altman Z-score

5.89

Safe zone

Rating

B+

Overall 3 / 5

Ratios by fiscal year

Margins and yields are shares of revenue, equity or price; multiples are ×.

Metric	FY2025	FY2024	FY2023	FY2022	FY2021	FY2020	FY2019	FY2018
P/E	29.73×	32.29×	27.56×	22.26×	33.9×	40.78×	17.66×	12.8×
P/B	10.12×	11.12×	7.92×	6.4×	7.69×	5.42×	3.41×	2.42×
P/S	4.08×	4.18×	3.13×	2.44×	3.41×	2.8×	1.91×	1.39×
EV / EBITDA	21.33×	22.46×	18.76×	15.7×	21.9×	20.11×	15.12×	9.39×
Gross margin	36.2%	35.7%	33.1%	31.0%	31.6%	30.5%	30.8%	30.5%
Operating margin	18.6%	17.6%	16.4%	15.1%	14.3%	12.3%	12.8%	12.2%
Net margin	13.7%	12.9%	11.4%	11.0%	10.1%	6.9%	10.8%	10.8%
Current ratio	1.25×	1.21×	1.13×	1.12×	1.36×	1.59×	1.28×	1.33×
Debt / equity	0.54×	0.72×	0.68×	0.79×	0.77×	0.82×	0.76×	0.58×
Interest coverage	17.44×	14.68×	12.34×	10.82×	8.66×	6.16×	6.87×	6.84×
Dividend yield	1.0%	0.9%	1.2%	1.6%	1.2%	1.5%	2.0%	2.8%
Payout ratio	28.7%	29.5%	33.8%	35.3%	39.4%	59.3%	36.2%	35.8%

Key metrics by fiscal year

Metric	FY2025	FY2024	FY2023	FY2022	FY2021	FY2020	FY2019	FY2018
Return on equity	33.9%	34.4%	28.9%	28.8%	22.7%	13.3%	19.3%	18.9%
Return on invested capital	20.3%	19.2%	16.5%	14.9%	12.1%	8.1%	8.5%	8.8%
Return on assets	13.6%	12.7%	10.4%	9.7%	7.9%	4.7%	6.9%	7.5%
Free cash flow yield	3.2%	3.3%	3.8%	3.1%	2.8%	3.7%	6.7%	6.1%
Earnings yield	3.4%	3.1%	3.7%	4.5%	3.0%	2.5%	5.7%	7.8%
Enterprise value	$89.9B	$86.7B	$59.1B	$42.7B	$50.9B	$36.8B	$29.2B	$20.3B
Net debt / EBITDA	0.68×	0.98×	1.17×	1.33×	1.15×	1.08×	2.21×	1.47×
Cash conversion cycle (days)	54	52	74	60	53	51	74	78