What happened

Shares of Johnson Controls (JCI -0.84%) have been under pressure this year due to investor concerns that a weak housing market would crimp demand for its ventilation and climate control equipment. The company's quarterly results released in November suggested that fear was overblown, and the stock jumped as a result.

Shares of Johnson Controls gained 14.9% in November, according to data provided by S&P Global Market Intelligence, cutting the stock's loss for the year in half in a single month.

So what

Johnson Controls is a maker of heating, ventilation, and air conditioning systems (HVAC) for commercial and residential buildings. With rising interest rates putting homebuilders under pressure and raising questions about new construction activity, investors had been worried about demand for the company's products.

The company's fiscal fourth-quarter results, announced in early November, helped put those fears to rest. Johnson Controls' results were in line with expectations, and more importantly it painted a rosy picture for fiscal 2023. Management expects high-single-digit to low-double-digit organic revenue growth, and also forecasts EBITDA margin to improve by 80 to 120 basis points.

"We have built our backlog considerably over the year, driven by our mission-critical solutions, which increasingly resonate with our customers," CFO Olivier Leonetti said in a statement. "As we look ahead, we remain confident in the resiliency of our products and services as we continue to navigate through an uncertain operating environment."

Now what

If there is a slowdown coming, it hasn't hit Johnson Controls yet. The company saw orders in the quarter grow by 13% year over year (adjusted to exclude M&A activity and foreign currency swings). Johnson Controls ended the period with a backlog of future business totaling $7.5 billion, up 18% from last year.

It is hard to predict what will happen to the economy (and housing) from here, and Johnson Controls could eventually have to temper its enthusiasm. But if nothing else, the results show the resilience of the business in a tough operating environment. For investors focused on the long term, Johnson Controls has demonstrated its ability to survive and thrive through the business cycle. Investors are warming to the stock as a result.