HVAC Companies: High Valuation Signal Time to Sell

Year-to-date, Heating, ventilation, and air conditioning (HVAC) companies have seen significant gains due to positive trends in nonresidential and replacement markets, driven by refrigerant transitions and SEER upgrades. In this recording, CFRA Senior Equity Analyst Emily Nasseff Mitsch highlighted that while revenue and earnings are expected to rise in 2025, the market is overvaluing these companies, with price-to-earnings (P/E) multiples 32% to 39% above the three-year average. A decrease in these multiples is anticipated for 2025.