Today’s Stock: Lennox International Inc. (LII)Today’s Stock: Lennox International Inc. (LII)

Lennox International Inc., together with its subsidiaries, designs, manufactures, and markets products for the heating, ventilation, air conditioning, and refrigeration markets in the United States, Canada, and internationally. The Home Comfort Solutions segment provides furnaces, air conditioners, heat pumps, packaged heating and cooling systems, indoor air quality equipment, comfort control products, and replacement parts and supplies; residential heating, ventilation, cooling equipment, and air conditioning;

My Thoughts 💭My Thoughts 💭

About six years ago, I had to replace my HVAC and furnace system (the joys of homeownership!). After receiving quotes for various systems, I decided to install a Lennox system due to its reputation. So far, it’s been a wise decision. The only annoyance is the smart thermostat that comes with the system. I find it inferior to an Ecobee, as the Lennox smart thermostat has caused issues over the years.

I never owned shares in this company but always kept it on my watchlist. It seemed like a great company, but for some reason, I never bought shares.

At 563.7k sats per share ($88,366), and a 5.8k sats per share dividend payment , it will take 95 years to break even on the capital investment in shares. With over 500k sats for a single share of stock that can dilute you at a moment’s notice, it may not be the best investment from a bitcoin value perspective. While the stock has a PE of 20, it’s still too rich in sats.

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This is another example of a company that is somewhat constrained in its growth potential. They are projected to grow at a maximum rate of 5% with a Price-to-Earnings (PE) ratio of 20 and a somewhat unattractive balance sheet. While they offer a decent dividend, investors need to invest a significant amount of capital to access it, which will be subject to taxation. Although I appreciate my Lennox system, I find it challenging to identify any compelling reasons to own the stock.

HVAC systems are indeed remarkable inventions that enhance the comfort of indoor living. However, these systems require substantial capital investment and boast decent profit margins exceeding 10%.

Companies like this align with the goals of Saylor, who aims to establish a bitcoin standard. With improved capital, they would have the opportunity to potentially grow and provide greater value to their customers, thereby stimulating growth and reflecting in the stock price. Instead, they continue to engage in the fiat debt strategy, returning 20% of their profits to shareholders while failing to achieve significant business growth that would be evident in the stock price. Over the past year, the stock has declined almost 20%. Similar to Adobe, the company appears to be functioning effectively, but investors are seeking growth rather than being bored with modest dividend payments.

Therefore, I do not intend to include this company in my portfolio.