TT Stock Forecast & Price Target

Trane Technologies is experiencing strong momentum in its commercial HVAC applied equipment segment, evidenced by a significant 60% increase in orders during the second quarter of 2025 and a remarkable 120% growth over a two-year period, which supports a favorable outlook for aftermarket revenues. The company has also demonstrated solid financial performance, with adjusted operating margins expanding by 90 basis points year-over-year to 20.3%, outperforming both internal estimates and consensus expectations. Additionally, the Americas region continues to show promise, achieving 9% organic growth, which aligns with forecasts, highlighting the company's steady performance across key markets.

Trane Technologies has revised its revenue outlook for the Americas Residential segment to flat year-over-year for 2025, a significant reduction from its earlier forecast of mid- to high-single-digit growth, signaling potential operational challenges. The company faces a combination of a canister shortage and elevated channel inventory, which is likely contributing to the subdued demand in the residential HVAC market. Additionally, broader market conditions, including sluggish new home construction and existing home sales, may adversely impact investor sentiment and overall performance in the sector.