AAON or JCI or WMS

Key Takeaways

• AAON shares have risen over 20% YTD, driven by strong backlog growth in data center cooling, though trading at a premium trailing P/E (price-to-earnings) ratio above 70x.
• JCI leads with approximately 20% YTD gains and 60%+ one-year returns, bolstered by AI acquisitions and building tech demand, at a more moderate P/E around 27x.
• WMS shows modest YTD performance near flat but 25%+ annual gains, supported by water management needs, with a P/E near 24x.
• All three operate in building products within industrials, with recent momentum tied to infrastructure and data centers, but JCI exhibits superior relative performance and scale (market cap ~$89B vs. $7-11B peers).
• Recent weeks highlight volatility recovery for AAON (+11-15% past month) amid earnings anticipation, while JCI sustains steady climbs near 52-week highs.
• Valuation sensitivity favors WMS and JCI over AAON's elevated multiples.

Introduction

This stock comparison examines AAON, JCI, and WMS, all key players in the building products segment of the industrials sector. These companies provide essential HVAC (heating, ventilation, and air conditioning) systems, advanced building technologies, and water management solutions, respectively, amid rising demand from data centers, infrastructure projects, and sustainability initiatives. Traders seeking momentum in growth areas like energy efficiency and construction, or investors eyeing relative performance and valuation trade-offs in a volatile market, will find this analysis valuable for understanding sector dynamics, recent price behaviors, and positioning.

AAON Overview and Recent Performance

AAON, Inc., headquartered in Tulsa, Oklahoma, engineers, manufactures, and sells premium HVAC equipment, including rooftop units, data center cooling, and energy recovery systems for commercial and industrial use. Operating through segments like AAON Oklahoma, AAON Coil Products, and BASX, it serves sectors such as data centers, healthcare, and education via a network of representatives.

In recent market activity, AAON shares have shown resilience, climbing over 11-15% in the past month from March lows, with YTD gains exceeding 20%. This recovery follows mixed Q4 2025 results, where net sales hit a record $1.44 billion (up 20% YoY) but EPS dipped to $1.29 amid margin pressures. A standout $1.83 billion backlog (up 111% YoY), fueled by BASX data center demand, and FY2026 guidance for 18-20% sales growth have boosted sentiment. Analyst targets average ~$108-123, reflecting optimism despite high valuation (trailing P/E ~72x, market cap ~$7.6B). Volatility persists with a beta around 1.25, influenced by industrial cycles and supply chain factors.

JCI Overview and Recent Performance

Johnson Controls International plc (JCI), a global leader in building products and systems, provides HVAC, fire safety, security, and energy solutions across Americas, EMEA, and Asia-Pacific. Its OpenBlue platform integrates AI for optimized building management.

Recent weeks have seen JCI shares advance ~8% monthly, pushing YTD gains to ~20% and one-year returns over 60%, trading near 52-week highs around $145 (market cap ~$89B). Momentum stems from strategic acquisitions like Nantum AI for energy optimization and Alloy Enterprises for data center thermal management, alongside Q1 sales growth to $5.8B and raised FY2026 EPS guidance to $4.70. Record orders in building tech and sustainability segments drive positive sentiment, with a trailing P/E ~27x and beta ~1.0. Broader industrials tailwinds, including rate expectations, support steady performance with lower relative volatility.

WMS Overview and Recent Performance

Advanced Drainage Systems, Inc. (WMS) designs and markets thermoplastic corrugated pipes and water management products for stormwater, septic, and drainage in residential, commercial, and agricultural applications, operating via Pipe, Infiltrator, and International segments across North America and beyond.

WMS shares have displayed mixed recent behavior, with YTD returns near flat (~ -1.5%) but one-year gains ~25-28%, fluctuating in a $104-179 range (market cap ~$11B). Past-month activity shows ~7% upside amid sector rotation, though three-month dips reflect construction sensitivity. FY2025 revenue reached $2.9B (up ~1%), with net income at $450M despite margin challenges. Demand for infrastructure and stormwater solutions underpins stability, with a trailing P/E ~24x and moderate beta. Sentiment ties to housing trends and water resilience, contributing to contained volatility versus HVAC peers.

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Head-to-Head Comparison

In business models, AAON focuses on custom HVAC manufacturing with niche data center exposure via BASX, contrasting JCI’s integrated global building tech ecosystem (HVAC + security + AI platforms) and WMS’s specialized drainage/infrastructure products. Growth drivers differ: AAON and JCI ride data center/AI booms (backlogs surging 100%+), while WMS benefits from stormwater regulations and construction.

Recent momentum favors JCI (steady 8-10% monthly, 60% annual), over AAON’s volatile rebound (+15% monthly) and WMS’s range-bound action. Risk factors include cyclicality: AAON’s high beta (1.25) and margin squeezes heighten sensitivity versus JCI’s scale-driven stability. Sector exposure aligns in building products (industrials), but JCI diversifies globally.

Valuations show trade-offs: AAON’s 72x P/E and 35x EV/EBITDA (enterprise value to EBITDA) premium prices growth, WMS at 24x P/E offers value, and JCI (27x P/E) balances scale (~$24B revenue vs. peers’ $1-3B). Market sentiment leans bullish on JCI’s acquisitions, with all benefiting from infrastructure tailwinds.

Tickeron AI Verdict

Tickeron’s AI currently favors JCI based on superior trend consistency, with 20%+ YTD and 60%+ annual gains amid stable catalysts like AI integrations and record orders. Its larger scale, moderate valuation (P/E ~27x), and lower relative volatility position it strongly versus AAON’s premium multiples despite backlog strength, or WMS’s steadier but lower momentum. Probabilistic edge tilts to JCI for sustained outperformance in industrials.

Disclaimer

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