Wrapping up Q1 earnings, we look at the numbers and key takeaways for the hvac and water systems stocks, including Lennox (NYSE: LII) and its peers.

Many HVAC and water systems companies sell essential, non-discretionary infrastructure for buildings. Since the useful lives of these water heaters and vents are fairly standard, these companies have a portion of predictable replacement revenue. In the last decade, trends in energy efficiency and clean water are driving innovation that is leading to incremental demand. On the other hand, new installations for these companies are at the whim of residential and commercial construction volumes, which tend to be cyclical and can be impacted heavily by economic factors such as interest rates.

The 9 HVAC and water systems stocks we track reported a very strong Q1. As a group, revenues beat analysts’ consensus estimates by 6.9%.

Thankfully, share prices of the companies have been resilient as they are up 9.3% on average since the latest earnings results.

Lennox (NYSE: LII)

Based in Texas and founded over a century ago, Lennox (NYSE: LII) is a climate control solutions company offering heating, ventilation, air conditioning, and refrigeration (HVACR) goods.

Lennox reported revenues of $1.14 billion, up 5.8% year on year. This print exceeded analysts’ expectations by 6.7%. Overall, it was a very strong quarter for the company with a solid beat of analysts’ organic revenue estimates.

"Our results this quarter were supported by stabilizing end-markets and encouraging momentum across our strategic initiatives, including the integration of Duro Dyne and Supco. We remain confident in our strategy to deliver long-term shareholder value through differentiated growth and bolt-on M&A opportunities," said CEO, Alok Maskara.

Interestingly, the stock is up 2.9% since reporting and currently trades at $510.

We think Lennox is a good business, but is it a buy today? Read our full report here, it’s free.

Best Q1: AAON (NASDAQ: AAON)

Backed by two million square feet of lab testing space, AAON (NASDAQ: AAON) makes heating, ventilation, and air conditioning equipment for different types of buildings.

AAON reported revenues of $496.9 million, up 54.3% year on year, outperforming analysts’ expectations by 29.5%. The business had an incredible quarter with a beat of analysts’ EPS and EBITDA estimates.

AAON scored the biggest analyst estimate beat and fastest revenue growth among its peers. The market seems happy with the results as the stock is up 42.6% since reporting. It currently trades at $140.15.

Is now the time to buy AAON? Access our full analysis of the earnings results here, it’s free.

Weakest Q1: A. O. Smith (NYSE: AOS)

Credited with the invention of the glass-lined water heater, A.O. Smith (NYSE: AOS) manufactures water heating and treatment products for various industries.

A. O. Smith reported revenues of $945.6 million, down 1.9% year on year, falling short of analysts’ expectations by 3.5%. It was a disappointing quarter as it posted full-year EPS guidance missing analysts’ expectations and a significant miss of analysts’ revenue estimates.

A. O. Smith delivered the highest full-year guidance raise but had the weakest performance against analyst estimates and slowest revenue growth in the group. As expected, the stock is down 8.9% since the results and currently trades at $58.

Read our full analysis of A. O. Smith’s results here.

CSW (NYSE: CSW)

With over two centuries of combined operations manufacturing and supplying, CSW (NYSE: CSW) offers special chemicals, coatings, sealants, and lubricants for various industries.

CSW reported revenues of $309 million, up 34% year on year. This number beat analysts’ expectations by 1.7%. It was a stunning quarter as it also produced a beat of analysts’ EPS and EBITDA estimates.

The stock is flat since reporting and currently trades at $279.53.

Read our full, actionable report on CSW here, it’s free.

Northwest Pipe (NASDAQ: NWPX)

Playing a large role in the Integrated Pipeline (IPL) project in Texas to deliver ~350 million gallons of water per day, Northwest Pipe (NASDAQ: NWPX) is a manufacturer of pipeline systems for water infrastructure.

Northwest Pipe reported revenues of $138.3 million, up 19.1% year on year. This print surpassed analysts’ expectations by 10.5%. Overall, it was an incredible quarter as it also put up a beat of analysts’ EPS and EBITDA estimates.

The stock is up 41.7% since reporting and currently trades at $121.91.

Read our full, actionable report on Northwest Pipe here, it’s free.

Market Update

Late in 2025 into early 2026, there was hand-wringing around artificial intelligence. For software companies, the fear was that AI would erode pricing power and compress margins as new tools made it easier to replicate what once required expensive enterprise platforms. Crypto investors had their own version of the same anxiety: if AI agents could trade, allocate capital, and manage wallets autonomously, what exactly was the long-term value of today’s crypto infrastructure?

These concerns triggered a noticeable rotation away from these sectors and into safer havens. But markets rarely dwell on one narrative for long. Spring 2026 came, and the focus shifted abruptly from technological disruption to geopolitical risk. The US’ conflict with Iran became the dominant driver of market psychology, and when geopolitics takes center stage, the script changes quickly. Investors stop debating growth rates and start worrying about oil supply, inflation, and global stability.

Want to invest in winners with rock-solid fundamentals? Check out our 9 Best Market-Beating Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.