Allegion (ALLE) AI Stock Analysis

• Market Cap: $14.63B
• Dividend Yield: 1.12%
• Average Volume (3M): 829.28K
• Price to Earnings (P/E): 23.7
• Beta (1Y): 0.75
• Revenue Growth: 5.49%
• EPS Growth: 14.46%
• Country: US
• Employees: 14,400
• Sector: Industrials
• Sector Strength: 72
• Industry: Security & Protection Services
• EPS (TTM): 2.04
• Shares Outstanding: 85,846,520
• 10 Day Avg. Volume: 747,032
• 30 Day Avg. Volume: 829,285
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 0.96
• Enterprise Value/Revenue: 3.62
• Enterprise Value/Gross Profit: 8.07
• Enterprise Value/Ebitda: 14.65
• 1Y Price Target: $175.56
• Price Target Upside: -0.91% Downside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 9

• Rating: 79 Outperform
• Price Target: $191.00 ▲(7.80% Upside)

Allegion's strong financial performance and positive earnings call are the primary drivers of its stock score. The company's robust revenue growth, strategic acquisitions, and effective cost management position it well for future growth. Technical indicators support a positive outlook, though caution is warranted due to potential overbought conditions. Valuation is fair, providing a balanced risk-reward profile.

Positive Factors

Revenue Growth

Achieving record revenue signifies strong market demand and effective business strategies, supporting long-term growth potential.

Strategic Acquisitions

Strategic acquisitions enhance Allegion's product portfolio and market reach, contributing to sustained growth and competitive advantage.

Cash Flow Generation

Strong cash flow generation enhances financial flexibility, enabling investments in growth initiatives and shareholder returns.

Negative Factors

Residential Market Challenges

Decline in the residential market due to high interest rates could impact revenue stability and growth in this segment.

International Segment Pressure

Pressure in the international mechanical portfolio could hinder global expansion efforts and affect overall revenue growth.

Higher Corporate Expenses

Rising corporate expenses, particularly for incentive compensation, may limit profitability and reduce operational efficiency.

Allegion Business Overview & Revenue Model

Company Description

Allegion plc manufactures and sells mechanical and electronic security products and solutions worldwide. The company offers door closers, controls, and exit devices; locks, locksets, portable locks, and key systems and services; electronic security products and access control systems; time, attendance, and workforce productivity systems; doors and door systems; and other accessories. The company sells its products and solutions to end-users in commercial, institutional, and residential facilities, including education, healthcare, government, hospitality, commercial office, and single and multi-family residential markets under the CISA, Interflex, LCN, Schlage, SimonsVoss, and Von Duprin brands. It sells its products and solutions through distribution and retail channels, such as specialty distribution, e-commerce, and wholesalers, as well as through various retail channels comprising do-it-yourself home improvement centers, on-line and e-commerce platforms, and small specialty showroom outlets. Allegion plc was incorporated in 2013 and is headquartered in Dublin, Ireland.

How the Company Makes Money

Allegion generates revenue through multiple streams, primarily by selling its security products and solutions to various sectors including commercial, institutional, and residential markets. The company’s revenue model is largely based on the direct sale of hardware products such as locks and door closers, as well as electronic access control systems. Key revenue streams include product sales, which encompass both mechanical and electronic products, as well as installation and maintenance services. Allegion also benefits from partnerships with distributors, contractors, and other industry players, which help expand its market reach. Additionally, the growing emphasis on security solutions and smart building technologies contributes to the company's earnings by driving demand for its innovative product offerings.

Allegion Financial Statement Overview

Summary

Allegion demonstrates strong financial performance with robust revenue growth, efficient cost management, and solid cash flow generation. The balance sheet is stable, though reliant on liabilities, necessitating careful debt management.

Income Statement

Allegion's income statement shows strong profitability with a consistent increase in total revenue over the years. The gross profit margin remains robust, indicating efficient cost management. The net profit margin has also improved, reflecting enhanced profitability. Notably, the company has demonstrated impressive revenue growth, especially in the TTM period, highlighting its capability to leverage market opportunities effectively.

Balance Sheet

The balance sheet reveals a stable financial position with a moderate debt-to-equity ratio, suggesting a balanced approach to leverage. Return on equity has improved, indicating effective use of shareholders' funds. However, the equity ratio is relatively low, implying a higher reliance on liabilities, which could pose a risk if not managed carefully.

Cash Flow

The cash flow statement is strong, with a significant increase in free cash flow, reflecting robust cash generation capabilities. The operating cash flow to net income ratio is healthy, indicating efficient conversion of profits into cash. The company has also shown a positive trend in free cash flow growth, enhancing its ability to fund operations and growth initiatives.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	3.88B	3.77B	3.65B	3.27B	2.87B	2.72B
Gross Profit	1.74B	1.67B	1.58B	1.32B	1.20B	1.18B
EBITDA	957.20M	916.90M	821.90M	688.30M	657.30M	497.50M
Net Income	626.20M	597.50M	540.40M	458.00M	483.00M	314.30M
Balance Sheet
Total Assets	4.91B	4.49B	4.31B	3.99B	3.05B	3.07B
Cash, Cash Equivalents and Short-Term Investments	656.80M	503.80M	468.10M	288.00M	397.90M	480.40M
Total Debt	2.07B	2.00B	2.02B	2.09B	1.44B	1.43B
Total Liabilities	3.13B	2.99B	2.99B	3.05B	2.29B	2.24B
Stockholders Equity	1.79B	1.50B	1.32B	941.80M	759.10M	829.40M
Cash Flow
Free Cash Flow	682.30M	582.90M	516.40M	395.50M	443.20M	443.20M
Operating Cash Flow	765.10M	675.00M	600.60M	459.50M	488.60M	490.30M
Investing Cash Flow	-145.00M	-228.40M	-129.10M	-994.10M	-31.60M	-56.70M
Financing Cash Flow	-721.90M	-394.50M	-298.70M	437.00M	-529.30M	-321.90M

Allegion Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 177.18
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ALLE, the sentiment is Positive. The current price of 177.18 is above the 20-day moving average (MA) of 170.19, above the 50-day MA of 162.54, and above the 200-day MA of 140.56, indicating a bullish trend. The MACD of 2.83 indicates Positive momentum. The RSI at 67.42 is Neutral, neither overbought nor oversold. The STOCH value of 66.54 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ALLE.

Allegion Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ALLE	79 Outperform	$14.63B	23.67	38.99%	1.12%	5.49%	14.46%
ADT	78 Outperform	$7.36B	12.88	17.13%	2.49%	3.80%	-3.18%
REZI	75 Outperform	$5.46B	64.31	-26.27%	―	20.00%	-547.75%
MSA	74 Outperform	$6.73B	24.14	24.23%	1.21%	0.55%	1.85%
NSSC	73 Outperform	$1.43B	33.70	24.98%	1.28%	-3.81%	-11.48%
BCO	67 Neutral	$4.76B	30.60	56.23%	0.85%	2.17%	25.34%
Sector *	64 Neutral	$10.84B	15.28	7.40%	1.99%	2.87%	-14.59%

Allegion Corporate Events

Allegion Holds Annual General Meeting in Dublin

On June 5, 2025, Allegion plc held its Annual General Meeting in Dublin, Ireland, where shareholders elected eight directors, approved executive compensation, ratified PricewaterhouseCoopers as the accounting firm, and renewed the Board’s authority to issue shares under Irish law. These decisions reflect the company’s ongoing governance and strategic initiatives, potentially impacting its operational and financial strategies moving forward.

Allegion Announces Leadership Transition with New Appointment

Allegion plc announced that Jeffrey Braun, the Senior Vice President and General Counsel, will transition to the role of Senior Vice President and Advisory Counsel effective June 16, 2025. This change follows the appointment of his successor by the Board of Directors on May 20, 2025, and Braun is expected to remain in this role until his retirement on June 30, 2025.