Allegion (ALLE) AI Stock Analysis

• Market Cap: $14.25B
• Dividend Yield: 1.21%
• Average Volume (3M): 900.27K
• Price to Earnings (P/E): 22.9
• Beta (1Y): 0.70
• Revenue Growth: 6.87%
• EPS Growth: 13.53%
• Country: US
• Employees: 14,400
• Sector: Industrials
• Sector Strength: 72
• Industry: Security & Protection Services
• EPS (TTM): 2.30
• Shares Outstanding: 86,031,950
• 10 Day Avg. Volume: 878,322
• 30 Day Avg. Volume: 900,271
• PEG Ratio: 1.68
• Price to Book (P/B): 7.59
• Price to Sales (P/S): 3.02
• P/FCF Ratio: 19.55
• Enterprise Value/Market Cap: 1.21
• Enterprise Value/Revenue: 4.35
• Enterprise Value/Gross Profit: 9.63
• Enterprise Value/Ebitda: 17.72
• 1Y Price Target: $188.38
• Price Target Upside: 13.76% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 9

• Rating: 72 Outperform
• Price Target: $186.00 ▲(12.33% Upside)

Allegion's overall stock score of 72 reflects strong financial performance and a positive earnings call outlook, which are slightly offset by bearish technical indicators and moderate valuation metrics. The company's robust profitability, cash generation, and strategic growth initiatives are significant strengths, while the technical analysis suggests caution in the short term.

Positive Factors

Revenue Growth

Strong revenue growth, particularly in the Americas nonresidential business, indicates robust demand and effective pricing strategies, supporting long-term expansion.

Cash Generation

Increased cash flow enhances Allegion's ability to invest in growth opportunities and strategic acquisitions, ensuring sustained financial health.

Product Portfolio Expansion

Strategic acquisitions expand Allegion's product offerings and market presence, enhancing competitive positioning and supporting long-term growth.

Negative Factors

Margin Pressures

Higher corporate expenses are pressuring margins, which could affect profitability if not managed, impacting long-term financial performance.

Leverage Concerns

Reliance on debt financing could pose risks if not managed carefully, potentially limiting financial flexibility and increasing vulnerability to interest rate changes.

Soft Residential Market

Weak residential market demand could hinder growth in this segment, affecting overall revenue diversification and stability.

Allegion Business Overview & Revenue Model

Company Description

Allegion (ALLE) is a global leader in security products and solutions, specializing in the development and manufacturing of locks, door closers, and access control systems. The company operates primarily in the industrial, commercial, and residential sectors, providing innovative products designed to enhance safety and security. Allegion's core offerings include electronic locks, mechanical locks, key systems, and door hardware, catering to a diverse range of customers and industries worldwide.

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 and profitability. The company effectively manages costs and generates significant cash flow, although the balance sheet indicates moderate leverage that requires careful 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	3.98B	3.77B	3.65B	3.27B	2.87B	2.72B
Gross Profit	1.80B	1.67B	1.58B	1.32B	1.20B	1.18B
EBITDA	976.20M	916.90M	821.90M	688.30M	657.30M	497.50M
Net Income	640.40M	597.50M	540.40M	458.00M	483.00M	314.30M
Balance Sheet
Total Assets	5.23B	4.49B	4.31B	3.99B	3.05B	3.07B
Cash, Cash Equivalents and Short-Term Investments	302.70M	503.80M	468.10M	288.00M	397.90M	480.40M
Total Debt	2.26B	2.15B	2.02B	2.09B	1.44B	1.43B
Total Liabilities	3.28B	2.99B	2.99B	3.05B	2.29B	2.24B
Stockholders Equity	1.95B	1.50B	1.32B	941.80M	759.10M	829.40M
Cash Flow
Free Cash Flow	702.42M	582.90M	516.40M	395.50M	443.20M	443.20M
Operating Cash Flow	787.71M	675.00M	600.60M	459.50M	488.60M	490.30M
Investing Cash Flow	-717.37M	-228.40M	-129.10M	-994.10M	-31.60M	-56.70M
Financing Cash Flow	-662.30M	-394.50M	-298.70M	437.00M	-529.30M	-321.90M

Allegion Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 165.59
• 50DMA: Negative
• 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 Negative. The current price of 165.59 is below the 20-day moving average (MA) of 174.75, below the 50-day MA of 173.77, and above the 200-day MA of 147.21, indicating a neutral trend. The MACD of -1.38 indicates Positive momentum. The RSI at 35.00 is Neutral, neither overbought nor oversold. The STOCH value of 20.51 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for ALLE.

Allegion Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
NSSC	―	$1.56B	37.00	24.98%	1.21%	-3.81%	-11.48%
MSA	―	$6.63B	22.93	23.35%	1.23%	3.31%	2.58%
ALLE	―	$14.25B	22.88	36.41%	1.21%	6.87%	13.53%
ADT	―	$7.14B	13.05	17.13%	2.56%	3.80%	-3.18%
REZI	―	$6.50B	―	-26.27%	―	20.00%	-547.75%
BCO	―	$4.70B	30.88	56.23%	0.86%	2.17%	25.34%
Sector *	―	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%

Allegion Corporate Events

Allegion PLC Maintains Stable Risk Profile with No New Threats in Latest Report

Allegion PLC has reported that there have been no material changes to their risk factors as outlined in their Annual Report on Form 10-K for the period ending December 31, 2024. This suggests a stable risk environment for the company, with no new significant threats identified. Stakeholders are encouraged to review the detailed ‘Risk Factors’ section in the Annual Report for comprehensive insights. This consistency in risk factors may indicate effective risk management strategies by Allegion PLC.

Allegion PLC Reports Strong Q3 2025 Earnings

Allegion PLC is a global leader in security products and solutions, specializing in innovative access solutions for residential and commercial markets worldwide. The company is known for its strong portfolio of brands including Schlage, Von Duprin, and LCN.

Allegion PLC Reports Robust Q3 2025 Earnings

The recent earnings call for Allegion PLC painted a generally positive picture, highlighting strong revenue growth, successful acquisitions, and effective capital allocation strategies. Despite these positive developments, the company faces challenges in maintaining margins due to increased corporate expenses and a soft residential market.