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Comfort Systems or Carrier: Which HVAC Stock Is a Buy Now?
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Key Takeaways
FIX grew Q3 revenue 35% to $2.45B and doubled EPS to $8.25 on strength in industrial and service work.
CARR's Q3 sales fell 7% as North American residential HVAC volume dropped about 40% year over year.
2025 EPS estimates rose for FIX but declined for CARR, reflecting diverging momentum and outlooks.
The heating, ventilation, and air conditioning (HVAC) industry sits directly at the center of major industrial investment cycles right now, from the rapid expansion of artificial intelligence data centers to broader sustainability upgrades and energy-efficient infrastructure. Comfort Systems USA (FIX - Free Report) and Carrier Global Corp. (CARR - Free Report) are two of the most prominent players benefiting from those long-term trends. Comfort Systems builds and services large-scale HVAC, mechanical and electrical systems across industrial, institutional and commercial end markets, while Carrier designs and manufactures global HVAC solutions with meaningful exposure to residential, commercial and data center applications.
Despite operating across similar market demand drivers, their recent financial trajectories sharply diverge. Comfort Systems is growing rapidly, delivering record profitability and expanding backlog levels, while Carrier is navigating a meaningful downturn in residential HVAC and seeing near-term revenue and earnings pressure as distributor inventories normalize. Both companies remain strategically positioned for future growth, but their current investment cases differ significantly.
Let’s dive deep and closely compare the fundamentals of the two stocks to determine which one is a better investment now.
The Case for Comfort Systems Stock
Comfort Systems has established itself as a prominent player in commercial HVAC services, with a strong focus on rapidly expanding segments like data centers, industrial facilities and healthcare infrastructure. The company continues to scale through both internal growth and targeted acquisitions — including the recent addition of Century Contractors — which strengthens its footprint in key markets such as Texas, Florida and the Carolinas. Thanks to its service-based business model, which typically involves shorter project cycles and quicker cash conversion, the company remains better protected from inflationary cost swings and tariff headwinds than traditional HVAC equipment makers.
Recently, Comfort Systems delivered another record-breaking quarter, driven by exceptional execution across both mechanical and electrical businesses. Revenue surged 35% year over year to $2.45 billion, fueled by strong construction activity and double-digit growth in service work. Profitability expanded sharply, with gross margin rising to 24.8% from 21.1% and net income doubling to $291.6 million, translating to EPS of $8.25—up more than 100% versus last year. Free cash flow also reached a standout $519 million, supported by strong payment terms and project closeouts. Backlog climbed to a new all-time high of $9.38 billion, up $3.7 billion from a year ago, reflecting unprecedented demand—especially in data centers and other industrial markets. With robust cash generation, FIX increased its quarterly dividend and continued share repurchases, while maintaining a strong net cash position. Management reiterated confidence in sustained growth into late 2025 and 2026, reinforced by a healthy project pipeline and recently completed acquisitions that add scale and end-market diversification.
Comfort Systems is benefiting from expanding scale and diversification. The acquisition of two electrical contracting firms—Feyen Zylstra and Meisner Electric—closed on Oct. 1, bringing incremental industrial and healthcare capabilities and roughly $200 million in annual revenue with $15 million to $20 million in EBITDA contribution. This enhances FIX’s ability to secure comprehensive mechanical-electrical packages in large infrastructure bids, particularly in data centers, advanced manufacturing and institutional markets. This positions FIX favorably against large contracting peers like Trane Technologies (TT - Free Report) and Johnson Controls (JCI - Free Report) , companies that often compete across similar mission-critical building opportunities. FIX’s decentralized model has enabled faster scaling with less capital intensity than engineering-heavy competitors such as Trane Technologies and Johnson Controls.
The outlook remains strong. Management expects continued high-teen same-store revenue growth in the fourth quarter and low-to-mid-teen revenue growth in 2026, supported by robust pipelines, better project mix and expanding service activity. Profitability is also expected to remain in the strong ranges achieved recently. With a net cash position and elevated free cash flow, the company increased its dividend by 20% and executed share repurchases during 2025.
The primary risks for FIX relate to macro-sensitive construction cycles, labor supply constraints and complexities in fixed-price project execution. Still, Comfort Systems continues to demonstrate pricing power, backlog durability and consistent operational excellence. The business today is aligned with the fastest-growing segments of U.S. infrastructure and is converting that demand into record earnings.
The Case for Carrier Stock
Carrier remains a global HVAC leader with advanced digital offerings, strong aftermarket positioning and mission-critical roles in energy-efficient buildings. However, Carrier is facing significant pressure from a sharp downturn in North American residential HVAC demand, with deep volume declines and ongoing channel destocking that have driven factory under-absorption and margin compression.
Recent performance highlights significant headwinds. In the third quarter of 2025, total net sales declined 7% to $5.6 billion, and organic sales fell 4%, driven primarily by an unexpected collapse in the North America residential market, where field inventory levels had to be reduced aggressively. GAAP operating profit fell 29% and adjusted operating profit declined 21%, resulting in adjusted earnings per share of 67 cents compared with 77 cents a year ago.
Management noted that North American residential volume fell roughly 40% year over year, creating significant under-absorption and margin pressure. The company acknowledged that pricing and regulation-related mix improvement could not offset the sharp volume drop. The company now expects 2025 sales of approximately $22 billion with weaker operational margins compared to prior plans, reflecting the ongoing destocking and market softness.
Yet Carrier retains bright spots in its portfolio. Commercial HVAC Americas continues to perform exceptionally well, growing around 30% in the third quarter. Carrier booked its largest-ever order with a major data center hyperscaler and continues to expect data center revenue to double from $500 million in 2024 to $1 billion in 2025. Aftermarket revenue also increased by double digits, and management expects this business to remain a durable earnings contributor.
Europe’s heat pump transition provides longer-term upside, and management is executing on aggressive restructuring and overhead reductions. The company is eliminating approximately 3,000 indirect positions and targeting more than $100 million of cost-saving carryover into 2026. A $5 billion share repurchase authorization further illustrates confidence in the strategy, though execution of that strategy depends heavily on an eventual residential recovery.
Carrier’s challenges remain tied to macro conditions impacting housing affordability, regulatory transition impacts on products and the timing of dealer inventory normalization. While its long-term vision is compelling, near-term earnings pressure continues to weigh on investor sentiment.
FIX & CARR’s Recent Stock Performances
Market pricing has clearly reflected each company’s momentum. Comfort Systems shares have gained 39.5% over the past three months, outperforming both the Zacks Building Products - Air Conditioner and Heating industry and the S&P 500. Carrier shares, in contrast, have lost 13.9% over the same period and continue to lag major benchmarks. The performance spread illustrates how investors are rewarding Comfort Systems’ growth visibility and penalizing Carrier’s cyclical exposure.
Comfort Systems currently trades near 39.12X forward 12-month earnings, a premium multiple that reflects high expectations but is supported by a return on equity of 43.6%.
Carrier’s forward earnings multiple near 19.15X and ROE of 17.8% appear more modest, consistent with a cyclical downturn and reduced 2025 operating leverage.
Competing U.S.-listed HVAC peers such as Trane Technologies and Johnson Controls have valuations closer to Carrier’s, with 29.92X and 25.32X, respectively. This depicts that FIX is uniquely priced for continued outsized growth.
Image Source: Zacks Investment Research
Estimate Revision Trend for FIX and CARR
Earnings estimate momentum strongly favors FIX. Over the past week, the Zacks Consensus Estimate for Comfort Systems’ 2025 earnings has increased from $23.14 per share to $26.31, indicating a year-over-year growth rate near 80.2%. Revenue growth is expected to exceed 24% in 2025 and remain double-digit in 2026.
For FIX Stock
Image Source: Zacks Investment Research
For Carrier, the opposite trend is unfolding. The consensus mark for 2025 EPS expectation has declined from $2.83 to $2.71 during the past month and reflects only about 5.9% annual earnings growth, while revenues are expected to decrease more than 8% in 2025 before a modest rebound in 2026. Analysts are raising Comfort Systems’ outlook while lowering Carrier’s, and earnings revisions remain one of the strongest predictors of future stock returns.
For CARR Stock
Image Source: Zacks Investment Research
Which HVAC Stock Is the Better Buy?
Comfort Systems is benefiting from exceptional secular tailwinds, including accelerated data center construction, electrification of industrial infrastructure and growth in service contracts tied to mission-critical mechanical systems. The company is executing at a high level, converting strong demand into robust margin expansion and free cash flow generation. This momentum is reflected in its Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Carrier retains strong market positions and should eventually benefit from residential recovery and continued data center buildouts. However, current results show that the company is still working through inventory imbalances, margin pressure and guidance reductions. Estimate cuts and ongoing residential weakness keep it rated at a Zacks Rank #5 (Strong Sell).
The long-term picture may still reward investors in both businesses, particularly if Carrier’s cost transformation and technology initiatives gain further traction. At this moment, however, the risk-reward balance is decisively tilted. Comfort Systems is the better buy now due to superior fundamental momentum, sharply positive earnings revisions, strong balance sheet positioning and continued share price outperformance. Carrier offers a patient recovery story, but today’s market rewards execution, and FIX is delivering precisely that.
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Comfort Systems or Carrier: Which HVAC Stock Is a Buy Now?
Key Takeaways
The heating, ventilation, and air conditioning (HVAC) industry sits directly at the center of major industrial investment cycles right now, from the rapid expansion of artificial intelligence data centers to broader sustainability upgrades and energy-efficient infrastructure. Comfort Systems USA (FIX - Free Report) and Carrier Global Corp. (CARR - Free Report) are two of the most prominent players benefiting from those long-term trends. Comfort Systems builds and services large-scale HVAC, mechanical and electrical systems across industrial, institutional and commercial end markets, while Carrier designs and manufactures global HVAC solutions with meaningful exposure to residential, commercial and data center applications.
Despite operating across similar market demand drivers, their recent financial trajectories sharply diverge. Comfort Systems is growing rapidly, delivering record profitability and expanding backlog levels, while Carrier is navigating a meaningful downturn in residential HVAC and seeing near-term revenue and earnings pressure as distributor inventories normalize. Both companies remain strategically positioned for future growth, but their current investment cases differ significantly.
Let’s dive deep and closely compare the fundamentals of the two stocks to determine which one is a better investment now.
The Case for Comfort Systems Stock
Comfort Systems has established itself as a prominent player in commercial HVAC services, with a strong focus on rapidly expanding segments like data centers, industrial facilities and healthcare infrastructure. The company continues to scale through both internal growth and targeted acquisitions — including the recent addition of Century Contractors — which strengthens its footprint in key markets such as Texas, Florida and the Carolinas. Thanks to its service-based business model, which typically involves shorter project cycles and quicker cash conversion, the company remains better protected from inflationary cost swings and tariff headwinds than traditional HVAC equipment makers.
Recently, Comfort Systems delivered another record-breaking quarter, driven by exceptional execution across both mechanical and electrical businesses. Revenue surged 35% year over year to $2.45 billion, fueled by strong construction activity and double-digit growth in service work. Profitability expanded sharply, with gross margin rising to 24.8% from 21.1% and net income doubling to $291.6 million, translating to EPS of $8.25—up more than 100% versus last year. Free cash flow also reached a standout $519 million, supported by strong payment terms and project closeouts. Backlog climbed to a new all-time high of $9.38 billion, up $3.7 billion from a year ago, reflecting unprecedented demand—especially in data centers and other industrial markets. With robust cash generation, FIX increased its quarterly dividend and continued share repurchases, while maintaining a strong net cash position. Management reiterated confidence in sustained growth into late 2025 and 2026, reinforced by a healthy project pipeline and recently completed acquisitions that add scale and end-market diversification.
Comfort Systems is benefiting from expanding scale and diversification. The acquisition of two electrical contracting firms—Feyen Zylstra and Meisner Electric—closed on Oct. 1, bringing incremental industrial and healthcare capabilities and roughly $200 million in annual revenue with $15 million to $20 million in EBITDA contribution. This enhances FIX’s ability to secure comprehensive mechanical-electrical packages in large infrastructure bids, particularly in data centers, advanced manufacturing and institutional markets. This positions FIX favorably against large contracting peers like Trane Technologies (TT - Free Report) and Johnson Controls (JCI - Free Report) , companies that often compete across similar mission-critical building opportunities. FIX’s decentralized model has enabled faster scaling with less capital intensity than engineering-heavy competitors such as Trane Technologies and Johnson Controls.
The outlook remains strong. Management expects continued high-teen same-store revenue growth in the fourth quarter and low-to-mid-teen revenue growth in 2026, supported by robust pipelines, better project mix and expanding service activity. Profitability is also expected to remain in the strong ranges achieved recently. With a net cash position and elevated free cash flow, the company increased its dividend by 20% and executed share repurchases during 2025.
The primary risks for FIX relate to macro-sensitive construction cycles, labor supply constraints and complexities in fixed-price project execution. Still, Comfort Systems continues to demonstrate pricing power, backlog durability and consistent operational excellence. The business today is aligned with the fastest-growing segments of U.S. infrastructure and is converting that demand into record earnings.
The Case for Carrier Stock
Carrier remains a global HVAC leader with advanced digital offerings, strong aftermarket positioning and mission-critical roles in energy-efficient buildings. However, Carrier is facing significant pressure from a sharp downturn in North American residential HVAC demand, with deep volume declines and ongoing channel destocking that have driven factory under-absorption and margin compression.
Recent performance highlights significant headwinds. In the third quarter of 2025, total net sales declined 7% to $5.6 billion, and organic sales fell 4%, driven primarily by an unexpected collapse in the North America residential market, where field inventory levels had to be reduced aggressively. GAAP operating profit fell 29% and adjusted operating profit declined 21%, resulting in adjusted earnings per share of 67 cents compared with 77 cents a year ago.
Management noted that North American residential volume fell roughly 40% year over year, creating significant under-absorption and margin pressure. The company acknowledged that pricing and regulation-related mix improvement could not offset the sharp volume drop. The company now expects 2025 sales of approximately $22 billion with weaker operational margins compared to prior plans, reflecting the ongoing destocking and market softness.
Yet Carrier retains bright spots in its portfolio. Commercial HVAC Americas continues to perform exceptionally well, growing around 30% in the third quarter. Carrier booked its largest-ever order with a major data center hyperscaler and continues to expect data center revenue to double from $500 million in 2024 to $1 billion in 2025. Aftermarket revenue also increased by double digits, and management expects this business to remain a durable earnings contributor.
Europe’s heat pump transition provides longer-term upside, and management is executing on aggressive restructuring and overhead reductions. The company is eliminating approximately 3,000 indirect positions and targeting more than $100 million of cost-saving carryover into 2026. A $5 billion share repurchase authorization further illustrates confidence in the strategy, though execution of that strategy depends heavily on an eventual residential recovery.
Carrier’s challenges remain tied to macro conditions impacting housing affordability, regulatory transition impacts on products and the timing of dealer inventory normalization. While its long-term vision is compelling, near-term earnings pressure continues to weigh on investor sentiment.
FIX & CARR’s Recent Stock Performances
Market pricing has clearly reflected each company’s momentum. Comfort Systems shares have gained 39.5% over the past three months, outperforming both the Zacks Building Products - Air Conditioner and Heating industry and the S&P 500. Carrier shares, in contrast, have lost 13.9% over the same period and continue to lag major benchmarks. The performance spread illustrates how investors are rewarding Comfort Systems’ growth visibility and penalizing Carrier’s cyclical exposure.
FIX & CARR Share Price Performance (3-Month Period)
Image Source: Zacks Investment Research
Valuation Profiles of FIX & CARR Stocks
Comfort Systems currently trades near 39.12X forward 12-month earnings, a premium multiple that reflects high expectations but is supported by a return on equity of 43.6%.
Carrier’s forward earnings multiple near 19.15X and ROE of 17.8% appear more modest, consistent with a cyclical downturn and reduced 2025 operating leverage.
Competing U.S.-listed HVAC peers such as Trane Technologies and Johnson Controls have valuations closer to Carrier’s, with 29.92X and 25.32X, respectively. This depicts that FIX is uniquely priced for continued outsized growth.
Image Source: Zacks Investment Research
Estimate Revision Trend for FIX and CARR
Earnings estimate momentum strongly favors FIX. Over the past week, the Zacks Consensus Estimate for Comfort Systems’ 2025 earnings has increased from $23.14 per share to $26.31, indicating a year-over-year growth rate near 80.2%. Revenue growth is expected to exceed 24% in 2025 and remain double-digit in 2026.
For FIX Stock
Image Source: Zacks Investment Research
For Carrier, the opposite trend is unfolding. The consensus mark for 2025 EPS expectation has declined from $2.83 to $2.71 during the past month and reflects only about 5.9% annual earnings growth, while revenues are expected to decrease more than 8% in 2025 before a modest rebound in 2026. Analysts are raising Comfort Systems’ outlook while lowering Carrier’s, and earnings revisions remain one of the strongest predictors of future stock returns.
For CARR Stock
Image Source: Zacks Investment Research
Which HVAC Stock Is the Better Buy?
Comfort Systems is benefiting from exceptional secular tailwinds, including accelerated data center construction, electrification of industrial infrastructure and growth in service contracts tied to mission-critical mechanical systems. The company is executing at a high level, converting strong demand into robust margin expansion and free cash flow generation. This momentum is reflected in its Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Carrier retains strong market positions and should eventually benefit from residential recovery and continued data center buildouts. However, current results show that the company is still working through inventory imbalances, margin pressure and guidance reductions. Estimate cuts and ongoing residential weakness keep it rated at a Zacks Rank #5 (Strong Sell).
The long-term picture may still reward investors in both businesses, particularly if Carrier’s cost transformation and technology initiatives gain further traction. At this moment, however, the risk-reward balance is decisively tilted. Comfort Systems is the better buy now due to superior fundamental momentum, sharply positive earnings revisions, strong balance sheet positioning and continued share price outperformance. Carrier offers a patient recovery story, but today’s market rewards execution, and FIX is delivering precisely that.