On July 1, Johnson Controls rose 4.27% in regular trading, trading at $146.465/share with turnover of $265 million, rebounding sharply from its recent pullback low. The rally was driven by dual catalysts lifting the global HVAC sector: extreme heat waves and surging AI data center cooling demand.

On the weather front, multiple European regions have issued red heat warnings, highlighting significant upside potential for air conditioning penetration rates across the continent. Simultaneously, high-density liquid cooling demand from data centers has surged, with Johnson Controls deeply embedded in the AI infrastructure supply chain. The company acquired Alloy Enterprises earlier this year to strengthen its data center thermal management capabilities and signed a deal with Armada to produce modular data centers at a dedicated Arizona facility.

Johnson Controls reported a record $18.2 billion backlog in Q1, largely driven by data center momentum. Multiple investment banks have raised price targets, with JPMorgan at $158 and Goldman Sachs at $154, both maintaining buy-equivalent ratings.

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