TT
Trane Technologies
Hybrid Industrial
★ Quality 77/100Price today
$473.86
what the market pays
Worth
$231.42
calculated cycle value
Price is 105% above its value
charlieapp.co
Price vs Intrinsic Value
The line is the price month by month; the green band marks when it's undervalued (−20% off value). When the price drops in there, the discount is real, not opinion.
Where does the value come from?
Manufacturing + technology
$244.10
per share
How it's calculated
Trane Technologies — high assistant path (2026-06-07). Review note.
Net cash in the bank
cash minus financial debt, per share
Total calculated value
business + cash
How many times the cash flow
Hybrid Industrial · vs 28 peers
You pay 38.8x times this business's cash flow; its sector median is 33.7x.
50% above what Charlie thinks it's worth (19.5x) — you're overpaying, sector or no sector.
Why Overvalued?
Its free cash flow is $12.53/share × 19.5x multiplier minus $12.68 in negative net cash = $231.42 in intrinsic value. Today's price of $473.86 is 51% above the calculated value — the market is paying a premium over what the model sees as fair.
The price is 105% above the calculated value. You're paying more than it's worth.
Buying here lowers your expected return and wipes out the safety margin.
The next reasonable entry zone starts at $219.85.
At what price would buying make sense?
Entry zones
🟢 Undervalued
≤$185.14
-20% off Value
🟡 Discounted
≤$219.85
-5% off Value
🔴 Today
$473.86
-51% Valor
Overvalued
The market prices it too high versus what the business makes. Patience pays off here.
“Time is the friend of the wonderful company, the enemy of the mediocre.”
— Warren Buffett
Model updated · July 2026
The business
Puts the equipment on the roof and charges for service for 20 years.
Trane Technologies makes climate control systems (HVAC — heating, ventilation and air conditioning) for commercial, residential and industrial buildings, plus transport refrigeration under the Thermo King brand. It sells the equipment and then charges for decades for service, parts and maintenance contracts. In 2025 it billed $21.3B with $2.8B of FCF.
The real business is in the installed base: once the equipment is on the building's roof, the owner comes back for service and parts for 15-20 years. Energy efficiency codes and the Trane brand create real switching costs. It's not a monopoly — it fights with Carrier, Daikin and Johnson Controls — but the recurring service gives it stability a pure manufacturer doesn't have.
Revenue history
From $14.1B to $21.3B in 4 years. The business grows steadily.
Where each $100 of sales goes
Revenue $21.3B · FY2025
Of every $100 in sales, $86 goes to costs and operations; $14 is left as net profit (14% margin).
Catalysts and risks
Demand for cooling for AI data centers, a segment growing at double digits annually.
Decarbonization and energy efficiency regulations in the U.S. and Europe forcing replacement of old equipment.
High commercial backlog that gives revenue visibility for 2026-2027.
Cyclical business: a drop in commercial construction hits new equipment directly.
Four large competitors with deep pockets limit pricing power.
$4.6B of debt against $1.8B of cash — manageable, but the cost rises in a high-rate environment.
Charlie's note
“A good boring business that collects a toll every time it's hot or cold. At 19.5x nothing is given away; you pay for quality at a fair price and wait for the recurring service to do the slow work.”
Analysis · June 2026
So when would be a good price for Trane Technologies?
By our calculation, not yet. We will email you the day it drops to $219.85 — so you do not have to keep checking.
🔔 Email meFree · no card
Charlie informs, it doesn't advise. No information should be taken as a recommendation to buy or sell.