Allegion PLC (ALLE)
NYSE:ALLE
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Allegion
(NYSE:ALLE)
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Rating:72Outperform
Price Target:
$162.00
▲(12.38% Upside)
Action:ReiteratedDate:02/18/26
The score is driven primarily by solid financial performance (profitability, cash conversion, and improved leverage) and a generally positive earnings outlook with supportive 2026 guidance. This is tempered by a fairly rich valuation and technical indicators that suggest the stock may be overextended in the near term, plus some 2025 financial statement comparability/data-quality flags.
Positive Factors
Strong Cash Generation
Consistent, high cash conversion and large absolute FCF provide durable financial flexibility: supports reinvestment, dividends, accretive M&A and working-capital needs, and cushions cyclical end‑market weakness. This underpins capital allocation over the next 2–6 months and beyond.
Negative Factors
U.S. Residential Softness
Prolonged weakness in residential volumes reduces a sizeable addressable market and can depress consolidated growth and margin leverage. If residential remains soft, it limits organic upside and forces greater reliance on pricing, productivity or M&A to hit company targets.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong Cash Generation
Consistent, high cash conversion and large absolute FCF provide durable financial flexibility: supports reinvestment, dividends, accretive M&A and working-capital needs, and cushions cyclical end‑market weakness. This underpins capital allocation over the next 2–6 months and beyond.
Read all positive factors
Allegion (ALLE) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$12.42B
Dividend Yield1.27%
Average Volume (3M)893.37K
Price to Earnings (P/E)21.2
Beta (1Y)0.64
Revenue Growth6.87%
EPS Growth13.53%
CountryUS
Employees14,400
SectorIndustrials
Sector Strength72
IndustrySecurity & Protection Services
Share Statistics
EPS (TTM)1.94
Shares Outstanding86,145,485
10 Day Avg. Volume829,518
30 Day Avg. Volume893,370
Financial Highlights & Ratios
PEG Ratio2.27
Price to Book (P/B)6.61
Price to Sales (P/S)3.36
P/FCF Ratio19.95
Enterprise Value/Market Cap1.15
Enterprise Value/Revenue3.53
Enterprise Value/Gross Profit7.80
Enterprise Value/Ebitda14.35
Forecast
1Y Price Target
$170.00Price Target Upside17.92% Upside
Rating ConsensusHold
Number of Analyst Covering5
EPS Forecast (FY)8.8
Revenue Forecast (FY)$4.32B
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 securit...
How the Company Makes Money
Allegion makes money primarily by selling security and access-related products and solutions. Its core revenue stream is product sales of mechanical locks and door hardware (e.g., locksets, cylinders, door closers, exit devices) for commercial/ins...
Allegion Earnings Call Summary
Earnings Call Date:Feb 17, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Apr 23, 2026
Earnings Call Sentiment Positive
The call conveyed a fundamentally positive view: strong revenue growth (Q4 +9.3% reported; organic +3.3%), robust cash flow (+17.6% YTD), accretive M&A (~$630M deployed) and margin resilience at the enterprise level (Q4 adj. operating margin +30 bps). Key strengths include Americas nonresidential and double-digit Electronics growth, a healthy balance sheet (net debt/EBITDA 1.6x), and constructive 2026 guidance (revenue +5%–7%, EPS $8.70–$8.90). Offsetting these positives are notable near-term headwinds: weaker U.S. residential volumes (down high single digits in Q4), International organic softness (down 2.3% organically), Americas margin pressure in Q4, and a tough Q1 comp plus a projected ~$0.10 tax headwind to EPS. Overall, the highlights (revenue, cash flow, accretive M&A, guidance) materially outweigh the short-term challenges tied to end-market softness and comparables.Positive Updates
Enterprise Revenue and Organic Growth
Q4 revenue was over $1.0B, up 9.3% versus 2024; enterprise described as delivering high single-digit revenue growth for fiscal 2025. Organic revenue in Q4 increased 3.3%, led by Americas nonresidential.
Negative Updates
Residential Market Softness
Americas residential revenue declined high single digits in Q4 as favorable pricing was more than offset by volume declines. Management expects U.S. residential to remain soft in 2026 with Americas residential down slightly.
Read all updates
Q4-2025 Updates
Positive
Negative
Enterprise Revenue and Organic Growth
Q4 revenue was over $1.0B, up 9.3% versus 2024; enterprise described as delivering high single-digit revenue growth for fiscal 2025. Organic revenue in Q4 increased 3.3%, led by Americas nonresidential.
Read all positive updates
Company Guidance
Allegion’s 2026 guidance calls for adjusted EPS of $8.70–$8.90 (roughly +8% at the midpoint, including an approximate $0.10 tax headwind), total revenue growth of 5–7% with organic growth of 2–4% (incorporating ~1 point from FX and ~2 points of M&A carryover), Americas organic growth of low‑ to mid‑single digits led by nonresidential, International low‑single‑digit growth led by Electronics (which is expected to outpace Mechanical), a shift toward more list price increases with pricing/moderate productivity expected to be positive on a dollar basis, anticipated available cash‑flow conversion of ~85–95% of adjusted net income, and a strong balance sheet with net debt/adjusted EBITDA around 1.6x to support continued capital deployment.Allegion Financial Statement Overview
Summary
Income Statement
78
Positive
Balance Sheet
72
Positive
Cash Flow
74
Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 4.07B | 3.77B | 3.65B | 3.27B | 2.87B |
| Gross Profit | 1.84B | 1.67B | 1.58B | 1.32B | 1.20B |
| EBITDA | 989.20M | 916.90M | 821.90M | 688.30M | 657.30M |
| Net Income | 643.80M | 597.50M | 540.40M | 458.00M | 483.00M |
Balance Sheet | |||||
| Total Assets | 5.22B | 4.49B | 4.31B | 3.99B | 3.05B |
| Cash, Cash Equivalents and Short-Term Investments | 356.20M | 503.80M | 468.10M | 288.00M | 397.90M |
| Total Debt | 2.28B | 2.15B | 2.02B | 2.09B | 1.44B |
| Total Liabilities | 3.16B | 2.99B | 2.99B | 3.05B | 2.29B |
| Stockholders Equity | 2.07B | 1.50B | 1.32B | 941.80M | 759.10M |
Cash Flow | |||||
| Free Cash Flow | 685.70M | 582.90M | 516.40M | 395.50M | 443.20M |
| Operating Cash Flow | 783.80M | 675.00M | 600.60M | 459.50M | 488.60M |
| Investing Cash Flow | -685.50M | -228.40M | -129.10M | -994.10M | -31.60M |
| Financing Cash Flow | -266.70M | -394.50M | -298.70M | 437.00M | -529.30M |
Allegion Technical Analysis
Negative
144.16
Price Trends
158.06
Negative
159.74
Negative
161.54
Negative
Market Momentum
-3.72
Negative
37.51
Neutral
37.40
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 144.16 is below the 20-day moving average (MA) of 145.85, below the 50-day MA of 158.06, and below the 200-day MA of 161.54, indicating a bearish trend. The MACD of -3.72 indicates Negative momentum. The RSI at 37.51 is Neutral, neither overbought nor oversold. The STOCH value of 37.40 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for ALLE.
Allegion Risk Analysis
Allegion disclosed 36 risk factors in its most recent earnings report. Allegion reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Allegion Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | $1.41B | 27.53 | 27.45% | 1.29% | -2.28% | -9.94% | |
72 Outperform | $12.42B | 21.24 | 34.76% | 1.27% | 6.87% | 13.53% | |
72 Outperform | $6.45B | 22.52 | 21.82% | 1.30% | 3.31% | 2.58% | |
70 Outperform | $5.37B | 10.53 | 16.19% | 2.73% | 4.77% | -22.78% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
56 Neutral | $4.25B | 24.49 | 79.36% | 0.85% | 3.07% | 48.57% | |
56 Neutral | $5.21B | 9.68 | -18.10% | ― | 15.45% | -488.24% |
* Industrials Sector Average
ALLE
Allegion
144.16
13.78
10.57%
BCO
Brink's Company
103.38
13.54
15.08%
MSA
MSA Safety
166.35
18.54
12.54%
NSSC
Napco Security Technologies
39.45
16.90
74.96%
ADT
Adt
6.55
-1.59
-19.58%
REZI
Resideo Technologies
34.45
15.83
85.02%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.