Markets

Modine Stock Plunges 20%, Wiping Out $1.3 Billion, After Tax Charge Cuts Profit

The thermal-management maker's adjusted earnings came in under the analyst average even as data center sales rose 95%.

Modine Manufacturing, which designs and makes heating, cooling and ventilation products, plunged 20.14% to $100.19 in Wednesday trading as of 9:49 a.m. ET, erasing about $1.3 billion in market value. The drop came the session after its Tuesday quarterly report showed a profit decline tied to a spin-off tax charge and adjusted earnings below the analyst average.

Sales surge, earnings slide

A $29.5 million tax charge tied to the Performance Technologies spin-off helped drag net earnings down 32% to $30.3 million, even as $994.4 million in revenue marked a 35% gain.

On an adjusted basis, per-share earnings rose 27% to $1.35. That trailed the $1.55 average estimate of four analysts surveyed by Zacks, according to an Associated Press earnings summary.

Data Centers segment sales rose 95% to $439.7 million. Higher material, component and tariff costs pulled that unit's margin down to 19.7%, a 4.7-point decline.

A data center bet, a battered stock

Modine's products include data center chillers and air handling units, heat exchanger coils, refrigeration and heating units, and cooling systems for vehicles. Data centers made up 35% of net sales in fiscal 2026, according to its annual report.

The company completed the Performance Technologies spin-off on October 1 and says it is confident in a higher revenue outlook for the remaining core business.

The stock was down about 6% year to date at Tuesday's close, while the S&P 500 was up about 11%. It had already fallen 30% over the prior month and sat 59% below its highest close of the past year, set on June 2. Wednesday's drop was on pace to be its biggest in at least 275 trading sessions, since October 1, 2025.

CEO Neil Brinker and CFO Michael Lucareli are scheduled to discuss the results on the company's call at 11:00 a.m. ET Wednesday.