Johnson Controls International plc (JCI) stock analysis

P/E above its 5-year median

Johnson Controls International's P/E of 30.9 is above its own 5-year median of 29.1.

P/E above the industry

Johnson Controls International's P/E of 30.9 is above the Industrial and Commercial Machinery and Computer Equipment median of 27.5.

EV/EBITDA below its 5-year median

Johnson Controls International's EV/EBITDA of 22.4 is below its 5-year median of 26.9.

P/B above the industry

Johnson Controls International's price-to-book of 6.44 is above the Industrial and Commercial Machinery and Computer Equipment median of 2.86.

Trading above fair value

The share price of $144.61 is above our fair value estimate of $111.79.

Margin of safety under 20%

The price is 29.4% above fair value, so there is no margin of safety.

Revenue growing under 10% a year

Revenue grew 4.7% a year over the last three fiscal years, short of the 10% we look for.

EPS growing 10%+ a year

Diluted EPS grew 20.3% a year over the last three fiscal years.

Earnings growth not accelerating

Net income grew -13.3% over the last twelve months, against a 5-year average of 11.8% a year.

Growing faster than the industry

Revenue grew 8.8% over the last twelve months; the Industrial and Commercial Machinery and Computer Equipment median is 7.8%.

Guidance raised

Johnson Controls International raised its fiscal 2026 full year Organic sales growth outlook on Jul 29, 2026.

Gross margin improving

Gross margin was 37.1% over the last twelve months, against 36.4% a year earlier.

Return on equity under 15%

Return on equity was 21.5% over the last twelve months and averaged 15.0% over five years; we look for 15% on both.

Return on invested capital

Needs operating income and invested capital.

Return on equity above the industry

Johnson Controls International's return on equity of 21.5% is above the Industrial and Commercial Machinery and Computer Equipment median of 3.1%.

Earnings grew over 5 years

Net income grew 11.8% a year on average over the last five fiscal years.

Net margin above its 5-year average

Net margin was 11.1% over the last twelve months, against a 5-year average of 9.6%.

Net margin above the industry

Johnson Controls International's net margin of 11.1% is above the Industrial and Commercial Machinery and Computer Equipment median of 5.3%.

High debt

Debt is 68.2% of shareholders' equity, above the 40% we consider low.

Debt rising against equity

Debt to equity rose from 44.1% five years ago to 68.2%.

Debt covered by cash flow

Operating cash flow over the last twelve months equals 41.7% of total debt.

Interest coverage

Interest expense is not reported separately.

Short-term assets don't cover short-term debts

Current assets are 0.90 times current liabilities.

Bankruptcy risk in the grey zone

The Altman Z-score is 2.59; above 3 is the safe zone and below 1.8 the distress zone.

Pays a dividend

Johnson Controls International paid dividends worth 0.8% of the share price over the last twelve months.

Yield below Treasuries

The 0.8% yield is below the 4.4% on a 1-year Treasury.

Yield below the top quarter

The top quarter of US dividend payers yield 3.8% or more; Johnson Controls International yields 0.8%.

Dividend not cut

The dividend per share has not fallen by more than 10% in any of the last 10 fiscal years.

Covered by earnings

Dividends take 34.2% of net income.

Covered by free cash flow

Dividends take 28.6% of free cash flow.