Quarterly earnings results are a good time to check in on a company’s progress, especially compared to its peers in the same sector. Today we are looking at Carrier Global (NYSE: CARR) and the best and worst performers in the hvac and water systems industry.

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 slower Q4. As a group, revenues were in line with analysts’ consensus estimates.

Amidst this news, share prices of the companies have had a rough stretch. On average, they are down 9.3% since the latest earnings results.

Carrier Global (NYSE: CARR)

Founded by the inventor of air conditioning, Carrier Global (NYSE: CARR) manufactures heating, ventilation, air conditioning, and refrigeration products.

Carrier Global reported revenues of $4.84 billion, down 6% year on year. This print fell short of analysts’ expectations by 3%. Overall, it was a disappointing quarter for the company with a significant miss of analysts’ revenue and adjusted operating income estimates.

"We continue to drive outsized growth in commercial HVAC1 with Q4 orders up nearly 50% driven by key data center wins and are well positioned to drive our sixth consecutive year of double-digit growth in this business in 2026. Our aftermarket1 playbook also continues to yield results, reflected in our fifth consecutive year of double-digit growth. We continue to control the controllables, reducing discretionary costs and building backlog in our long-cycle businesses to mitigate residential market challenges," said Carrier Chairman & CEO David Gitlin.

The stock is down 15.8% since reporting and currently trades at $53.53.

Read our full report on Carrier Global here, it’s free.

Best Q4: 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 $125.6 million, up 5% year on year, outperforming analysts’ expectations by 2.8%. The business had a stunning quarter with a beat of analysts’ EPS and revenue estimates.

The market seems content with the results as the stock is up 3.4% since reporting. It currently trades at $76.56.

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

Weakest Q4: 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 $233 million, up 20.3% year on year, falling short of analysts’ expectations by 6%. It was a disappointing quarter as it posted a significant miss of analysts’ revenue and adjusted operating income estimates.

CSW delivered the weakest performance against analyst estimates in the group. As expected, the stock is down 12% since the results and currently trades at $263.91.

Read our full analysis of CSW’s results here.

Trane Technologies (NYSE: TT)

With low-pressure heating systems as its first product, Trane (NYSE: TT) designs, manufactures, and sells HVAC and refrigeration systems, the former to commercial and residential building customers and the latter to commercial truck manufacturers.

Trane Technologies reported revenues of $5.14 billion, up 5.5% year on year. This print topped analysts’ expectations by 0.8%. However, it was a slower quarter as it recorded a miss of analysts’ EBITDA estimates.

The stock is up 3.6% since reporting and currently trades at $408.57.

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

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 $912.5 million, flat year on year. This result came in 1.5% below analysts' expectations. Overall, it was a slower quarter as it also recorded a miss of analysts’ revenue estimates and full-year revenue guidance slightly missing analysts’ expectations.

A. O. Smith scored the highest full-year guidance raise among its peers. The stock is down 7.3% since reporting and currently trades at $64.44.

Read our full, actionable report on A. O. Smith 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 Top 5 Quality Compounder Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.