CSW Industrials (NYSE:CSW) & Trane Technologies (NYSE:TT) Financial Comparison

Trane Technologies (NYSE:TT) and CSW Industrials (NYSE:CSW) are both industrials companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, earnings, dividends, analyst recommendations, risk, valuation and institutional ownership.

Insider and Institutional Ownership

83.0% of Trane Technologies shares are owned by institutional investors. Comparatively, 82.8% of CSW Industrials shares are owned by institutional investors. 0.4% of Trane Technologies shares are owned by insiders. Comparatively, 1.2% of CSW Industrials shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Analyst Recommendations

This is a breakdown of current recommendations and price targets for Trane Technologies and CSW Industrials, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Trane Technologies	1	2	10	2	2.87
CSW Industrials	0	6	1	2	2.56

Trane Technologies currently has a consensus price target of $520.07, suggesting a potential upside of 7.85%. CSW Industrials has a consensus price target of $347.57, suggesting a potential downside of 0.63%. Given Trane Technologies’ stronger consensus rating and higher probable upside, equities research analysts plainly believe Trane Technologies is more favorable than CSW Industrials.

Dividends

Trane Technologies pays an annual dividend of $4.20 per share and has a dividend yield of 0.9%. CSW Industrials pays an annual dividend of $1.20 per share and has a dividend yield of 0.3%. Trane Technologies pays out 31.8% of its earnings in the form of a dividend. CSW Industrials pays out 16.5% 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. Trane Technologies has raised its dividend for 5 consecutive years and CSW Industrials has raised its dividend for 6 consecutive years.

Volatility & Risk

Trane Technologies has a beta of 1.19, suggesting that its stock price is 19% more volatile than the S&P 500. Comparatively, CSW Industrials has a beta of 0.83, suggesting that its stock price is 17% less volatile than the S&P 500.

Earnings & Valuation

This table compares Trane Technologies and CSW Industrials”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Trane Technologies	$21.32 billion	4.98	$2.92 billion	$13.20	36.53
CSW Industrials	$1.08 billion	5.26	$112.04 million	$7.29	47.98

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

Profitability

This table compares Trane Technologies and CSW Industrials’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Trane Technologies	13.28%	35.72%	13.65%
CSW Industrials	10.34%	17.41%	8.90%

Summary

Trane Technologies beats CSW Industrials on 12 of the 17 factors compared between the two stocks.

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.

About CSW Industrials

CSW Industrials, Inc. operates as a diversified industrial company in the United States and internationally. It operates through three segments: Contractor Solutions, Engineered Building Solutions, and Specialized Reliability Solutions. The Contractor Solutions segment provides condensate pads, pans, pumps, switches, and traps; cements, diffusers, grilles, registers, solvents, thread sealants, and vents; line set covers; refrigerant caps; wire pulling head tools; electrical protection, chemical maintenance, and installation supplies for HVAC; ductless mini-split systems installation support tools and accessories; and drain waste and vent system products for use in HVAC/R, plumbing, general industrial, architecturally specified building products. The Engineered Building Solutions segment offers architectural railings and associated services; fire and smoke protection solutions; and pre-engineered and custom architectural building components for use in architecturally specified building products. The Specialized Reliability Solutions segment provides compounds, lubricants, lubricant management products, and sealants; desiccant breather filtration products; and contamination control, industrial maintenance and repair, rail friction modifiers, sealants, and operations solutions for use in energy, general industrial, mining, and rail transportation. The company was incorporated in 2014 and is headquartered in Dallas, Texas.