Investment Thesis
Johnson Controls demonstrates stable operational performance with solid profitability (9.0% net margin) and strong interest coverage (16.9x), supported by healthy free cash flow generation of $492M. However, weakening net income (-6.3% YoY despite revenue growth), concerning liquidity metrics (current ratio 0.99x, quick ratio 0.81x), and modest returns on equity (4.0%) indicate operational challenges and capital efficiency concerns that warrant caution.
JCI Strengths
- Strong interest coverage ratio (16.9x) indicates minimal financial distress risk
- Solid free cash flow generation ($492M) with 8.5% FCF margin demonstrates operational cash conversion
- Moderate debt-to-equity ratio (0.66x) maintains reasonable leverage with substantial asset base ($38B)
JCI Risks
- Net income declined 6.3% YoY while revenue grew only 2.8%, indicating margin compression and operational deterioration
- Liquidity position is critically tight with current ratio below 1.0x and quick ratio of 0.81x, limiting financial flexibility
- Poor return metrics (ROE 4.0%, ROA 1.4%) suggest inefficient capital deployment and concerning return on shareholder investments
Key Metrics to Watch
- Net margin trend - monitor for stabilization or further deterioration in profitability
- Current ratio and working capital management - critical to assess liquidity adequacy
- Operating cash flow sustainability - essential to ensure continued dividend and debt servicing capability
JCI Financial Metrics
JCI Profitability Ratios
JCI Balance Sheet & Liquidity
JCI 5-Year Financial Trend
5-Year Trend Summary: Johnson Controls International plc's revenue has remained relatively flat over the 5-year period, with a 2% decline. The most recent EPS of $2.69 reflects profitable operations.
JCI Growth Metrics (YoY)
JCI Quarterly Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q1 2026 | $5.4B | $419.0M | $0.63 |
| Q3 2025 | $5.9B | $701.0M | $1.07 |
| Q2 2025 | $5.6B | $97.0M | $0.14 |
| Q1 2025 | $5.2B | $374.0M | $0.55 |
| Q3 2024 | $7.1B | $975.0M | $1.45 |
| Q2 2024 | $6.7B | $97.0M | $0.14 |
| Q1 2024 | $6.1B | $118.0M | $0.17 |
| Q3 2023 | $6.6B | $379.0M | $0.55 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
JCI Capital Allocation
JCI SEC Filings
Access official SEC EDGAR filings for Johnson Controls International plc (CIK: 0000833444)