Using the PEG framework with analyst consensus forward EPS growth of 14.3% plus 0.9% dividend yield, Trane Technologies plc has a fair value of $211.27 based on NTM EPS (FY2026) of $14.80. The current PEG ratio is 1.94.
PEG < 1 = bargain, 1–1.5 = fair, > 2 = expensive.
PEG works well for steady growers with predictable earnings.
| EPS Growth RateForward | 13.4% |
| Dividend Yield | +0.9% |
| Adjusted Growth (clamped 8–25%) | 14.3% |
| Fair P/E | 14.3x |
| NTM EPS (FY2026) | $14.80 |
| Fair Value | $211.27 |
| Period | EPS Est. | Growth | Analysts |
|---|---|---|---|
| FY2025 (actual) | $12.98 | — | — |
| FY2026E | $14.80 | +14.0% | 17 |
| FY2027E | $16.79 | +13.4% | 17 |
| FY2028E | $18.91 | +12.6% | 10 |
3Y Forward EPS CAGR: 13.4%
| Year | Net Income | EPS | YoY |
|---|---|---|---|
| FY2021 | $1.4B | $5.87 | — |
| FY2022 | $1.8B | $7.48 | +27.4% |
| FY2023 | $2.0B | $8.77 | +17.2% |
| FY2024 | $2.6B | $11.24 | +28.2% |
| FY2025 | $2.9B | $12.98 | +15.5% |
4Y Historical EPS CAGR: 21.9%
The PEG Fair Value uses the Price/Earnings-to-Growth framework. A stock is fairly valued when its P/E ratio equals its earnings growth rate (PEG = 1.0). This model adds dividend yield to the growth rate per the original PEGY formula.
Growth rate priority: analyst consensus forward EPS CAGR (when ≥ 3 analysts cover the stock), falling back to historical EPS CAGR. Using EPS rather than net income avoids distortion from share buybacks. The growth rate is clamped between 8% and 25% — below 8% would undervalue stable earners, while above 25% would overvalue unsustainable spikes.