Trane Technologies (TT) should benefit from transport recovery in 2026 in the Americas region and "strong" exposure to applied heating, ventilation, and air conditioning, or HVAC, BofA Securities analysts said in a Thursday note.

Trane has performed well amid the residential slowdown in the second half of 2025 and should capture the potential upside in 2026, analysts said.

For its applied HVAC business, Trane has seen particular strength in data centers as well as education, government, and health care, analysts said.

Trane's Residential segment is expected to continue facing challenges in H1 2026, but should see improvement in H2, BofA said. Analysts project residential revenue to decrease 6% in H1 and increase 13% in H2.

BofA upgraded the stock's rating to buy from neutral and increased its price objective to $550 from $490.

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