Johnson Controls: Buy, Sell, or Hold?
A healthy bull vs. bear debate over Johnson Controls (NYSE: JCI) is happening. Since it makes sense to look at both sides of the argument before investing hard-earned money, I thought I'd consider what each side might argue over the stock before I draw any conclusions.
Johnson Controls organizes itself across two related activities. Its global-products business ($9.4 billion in sales in 2022) provides heating, ventilation, air conditioning, and refrigeration (HVACR) equipment, building controls, and fire and security systems to the applied (institutional, industrial, etc.), light commercial, and residential markets. Its other business is building solutions, which operates out of three geographically based segments that generated $15.9 billion in sales in 2022. It offers procurement and installation of HVACR equipment as well as related services.
There are two main bear arguments, and they are focused on the company's end markets. The first concerns its commercial construction exposure and its presence in the commercial office sector. It's no secret that office vacancy rates continue to rise, and there are question marks around an extended oversupply of office space given an increase in remote work over the last few years. At the same time, rising interest rates are putting pressure on commercial real estate debt holders.
Source Fool.com
