Is Trane Technologies Plc overvalued or undervalued?

Jun 25 2025 08:05 AM IST
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As of May 8, 2025, Trane Technologies Plc is considered overvalued with an expensive valuation grade, reflected in its high P/E ratio of 38 and EV to EBITDA ratio of 27.03, despite outperforming the S&P 500 with a year-to-date return of 15.59%.
As of 8 May 2025, Trane Technologies Plc has moved from a valuation grade of very expensive to expensive. The company is currently considered overvalued. Key ratios include a P/E ratio of 38, an EV to EBITDA ratio of 27.03, and a ROE of 37.21%.

In comparison to peers, Trane Technologies has a P/E ratio that is higher than Johnson Controls International Plc at 24.92 and Parker-Hannifin Corp. at 33.82, indicating a premium valuation relative to these companies. Additionally, the PEG ratio of 1.37 suggests that while growth is expected, the price may not be justified by earnings growth. Notably, Trane Technologies has outperformed the S&P 500 with a year-to-date return of 15.59% compared to the index's 2.44%, reinforcing its strong market performance despite its overvaluation.
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