Financial Survey: Trane Technologies (NYSE:TT) and Carrier Global (NYSE:CARR)

Carrier Global (NYSE:CARR) and Trane Technologies (NYSE:TT) are both large-cap industrials companies, but which is the better investment? We will contrast the two companies based on the strength of their institutional ownership, earnings, risk, dividends, valuation, analyst recommendations and profitability.

Risk and Volatility

Carrier Global has a beta of 1.33, suggesting that its stock price is 33% more volatile than the S&P 500. Comparatively, Trane Technologies has a beta of 1.19, suggesting that its stock price is 19% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of recent recommendations for Carrier Global and Trane Technologies, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Carrier Global	1	8	11	0	2.50
Trane Technologies	0	4	14	2	2.90

Carrier Global currently has a consensus price target of $69.27, suggesting a potential upside of 32.08%. Trane Technologies has a consensus price target of $535.89, suggesting a potential upside of 33.31%. Given Trane Technologies’ stronger consensus rating and higher possible upside, analysts clearly believe Trane Technologies is more favorable than Carrier Global.

Earnings & Valuation

This table compares Carrier Global and Trane Technologies”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Carrier Global	$21.75 billion	1.97	$1.48 billion	($2.22)	-23.62
Trane Technologies	$21.32 billion	4.13	$2.92 billion	$14.16	28.39

Trane Technologies has lower revenue, but higher earnings than Carrier Global. Carrier Global is trading at a lower price-to-earnings ratio than Trane Technologies, indicating that it is currently the more affordable of the two stocks.

Dividends

Carrier Global pays an annual dividend of $0.96 per share and has a dividend yield of 1.8%. Trane Technologies pays an annual dividend of $4.20 per share and has a dividend yield of 1.0%. Carrier Global pays out -43.2% of its earnings in the form of a dividend. Trane Technologies pays out 29.7% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Carrier Global has increased its dividend for 4 consecutive years and Trane Technologies has increased its dividend for 5 consecutive years. Carrier Global is clearly the better dividend stock, given its higher yield and lower payout ratio.

Institutional & Insider Ownership

91.0% of Carrier Global shares are held by institutional investors. Comparatively, 83.0% of Trane Technologies shares are held by institutional investors. 6.5% of Carrier Global shares are held by insiders. Comparatively, 0.4% of Trane Technologies shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares Carrier Global and Trane Technologies’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Carrier Global	-7.90%	16.99%	6.06%
Trane Technologies	13.56%	37.26%	14.17%

Summary

Trane Technologies beats Carrier Global on 12 of the 18 factors compared between the two stocks.

About Carrier Global

Carrier Global Corporation provides heating, ventilating, and air conditioning (HVAC), refrigeration, fire, security, and building automation technologies in the United States, Europe, the Asia Pacific, and internationally. It operates through three segments: HVAC, Refrigeration, and Fire & Security. The HVAC segment provides products, controls, services, and solutions to meet the heating, cooling, and ventilation needs of residential and commercial customers. Its products include air conditioners, heating systems, heat pumps, controls, and aftermarket components, as well as aftermarket repair and maintenance services and building automation solutions. The Refrigeration segment offers transport refrigeration and monitoring products and services, as well as digital solutions for trucks, trailers, shipping containers, intermodal applications, food retail, and warehouse cooling; and commercial refrigeration solutions, such as refrigerated cabinets, freezers, systems, and controls. The Fire & Security segment provides various residential, commercial, and industrial technologies, including fire, flame, gas, smoke, and carbon monoxide detection; portable fire extinguishers; fire suppression systems; intruder alarms; access control systems; video management systems; and electronic controls. This segment also offers fire and security service, such as audit, design, installation, and system integration, as well as aftermarket maintenance and repair and monitoring services. It offers its products under the Autronica, Det-Tronics, Edwards, Aritech, Fireye, GST, Kidde, LenelS2, Marioff, Onity, and Supra; Carrier, Toshiba, Automated Logic, Bryant, CIAT, Day & Night, Heil, NORESCO, and Riello; and Carrier Commercial Refrigeration, Carrier Transicold, and Sensitech brands. Carrier Global Corporation was incorporated in 2019 and is headquartered in Palm Beach Gardens, Florida.

About Trane Technologies

Trane Technologies plc, together with its subsidiaries, designs, manufactures, sells, and services of solutions for heating, ventilation, air conditioning, custom, and custom and transport refrigeration in Ireland and internationally. It offers air conditioners, exchangers, and handlers; airside and terminal devices; air sourced heat pumps, auxiliary power units; chillers; coils and condensers; gensets; dehumidifiers; ductless; furnaces; home automation products; humidifiers; indoor air quality assessments and related products; large and light commercial unitary products; refrigerant reclamation products; thermostats/controls; transport heater products; variable refrigerant flow products; and water source heat pumps. The company also provides building management, telematic, control, energy efficiency and infrastructure program, geothermal, thermal energy, thermostats, rate chambers, package heating and cooling, temporary heating and cooling, and unitary systems; bus, rail, and multi-pipe heating, ventilation, and air conditioning systems; and container, diesel-powered, truck, industrial, rail, self-powered truck, trailer, and vehicle-powered truck refrigeration and air filtration systems, as well as aftermarket and OEM parts and supplies. In addition, it offers energy and facility management, installation and performance contracting, repair and maintenance, and rental services. It markets and sells its products under the Trane and Thermo King brands through sales offices, distributors, and dealers; and through sales and service companies with a supporting chain of distributors. The company was formerly known as Ingersoll-Rand Plc and changed its name to Trane Technologies plc in March 2020. Trane Technologies plc was founded in 1885 and is headquartered in Swords, Ireland.