Assa Abloy (ASAZY) AI Stock Analysis

• Market Cap: $38.16B
• Dividend Yield: 1.27%
• Average Volume (3M): 7.08K
• Price to Earnings (P/E): 26.9
• Beta (1Y): 0.83
• Revenue Growth: 8.40%
• EPS Growth: 0.21%
• Country: US
• Employees: 64,460
• Sector: Industrials
• Sector Strength: 72
• Industry: Security & Protection Services
• EPS (TTM): 0.21
• Shares Outstanding: 2,110,100,000
• 10 Day Avg. Volume: 0
• 30 Day Avg. Volume: 7,078
• PEG Ratio: -2.31
• Price to Book (P/B): 3.89
• Price to Sales (P/S): 2.59
• P/FCF Ratio: 22.36
• Enterprise Value/Market Cap: 11.15
• Enterprise Value/Revenue: 2.80
• Enterprise Value/Gross Profit: 6.55
• Enterprise Value/Ebitda: 14.46
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): 0.87
• Revenue Forecast (FY): $16.99B

• Rating: 65 Neutral
• Price Target: $18.50 ▼(-1.39% Downside)
• Action: Reiterated Date: 02/08/26
• Date: Action: Reiterated 02/08/26

The score is primarily supported by solid profitability and cash generation, reinforced by constructive (but mixed) earnings-call fundamentals. It is held back by expensive valuation and technically overbought conditions, alongside near-term risks flagged on the call (notably FX headwinds and acquisition-related dilution).

Positive Factors

Strong cash generation and conversion

Persistent high cash conversion demonstrates durable cash generation that supports dividends, debt servicing and an active M&A program. Over 100% conversion in the year provides financial flexibility to invest, weather cyclical downturns and fund strategic deals without relying solely on equity issuance.

Resilient margins and operating leverage

Sustained mid-teens operating margins and demonstrated operating leverage indicate structural profitability. Strong operating margins reflect pricing power, efficient cost control and scale advantages across divisions, improving earnings durability even if top-line growth moderates.

Structural shift to electromechanical and recurring software

A multi-year transition toward electromechanical products and growing SaaS drives higher-margin, recurring revenue and stronger customer lock-in. This structural move increases lifetime revenue per customer, supports cross-sell, and improves predictability versus pure hardware sales.

Negative Factors

Material currency (FX) headwinds

Significant FX exposure materially reduces reported revenue and trims margins, complicating multi-quarter guidance and cash flow visibility. Persistent currency pressure can erode growth metrics and force repeated price or cost actions, constraining reliable medium-term performance.

Greater China / APAC weakness

Sizable underperformance in Greater China and broader APAC limits a key growth market and depresses regional margins (APAC EBIT margin notably below group). Recovery in these markets can be slow and structurally reduce global organic growth unless market share or end-market demand rebounds.

Elevated leverage versus earlier years

Higher leverage reduces financial flexibility and increases sensitivity to cash-flow shocks, FX swings or rate moves. While returns on equity remain healthy, elevated debt raises refinancing and covenant risk, potentially limiting the pace of value-accretive M&A or capital returns during downturns.

Assa Abloy Business Overview & Revenue Model

Company Description

Assa Abloy (ASAZY) is a global leader in access solutions, specializing in the development and manufacture of locks, doors, and entrance automation systems. The company operates across various sectors including residential, commercial, institutional, and industrial markets. Its core products encompass mechanical and electronic locks, access control systems, door operators, and identity management solutions, catering to the evolving needs of security and convenience in both physical and digital spaces.

How the Company Makes Money

Assa Abloy makes money primarily by selling access-related products and solutions to building owners, contractors, locksmiths, distributors, retailers, and OEM/industrial customers. Key revenue streams include: (1) Mechanical locking and door hardware products—sales of locks, cylinders, keys, and related door components used in new construction and retrofit/upgrade projects; (2) Electromechanical and digital access solutions—sales of electronic locks, access control devices, credentials, and associated software/solutions used to manage entry permissions, often as part of broader building security and smart-building projects; (3) Entrance automation—sales of automatic doors and related systems for commercial/public environments where hands-free access and high traffic flow are needed; and (4) Aftermarket and service-related revenue—ongoing replacement demand for worn components, upgrades from mechanical to electronic solutions, rekeying and system expansions, and project-based installation/support typically delivered through partners such as integrators, distributors, and locksmiths. Earnings are influenced by construction and renovation activity, demand for security and compliance-driven upgrades, and the company’s ability to sell higher-value integrated solutions (e.g., combining hardware with electronics and software) through its multi-brand portfolio and global distribution ecosystem. Specific revenue breakdowns by segment, recurring software revenue details, or named major partnerships are not available in this response and are therefore null.

Assa Abloy Financial Statement Overview

Summary

Profitable with resilient gross/operating margins, mid-teens ROE, and strong free-cash-flow conversion versus net income. Offsetting this are a sharp reported 2025 revenue decline, some net margin pressure, higher leverage versus earlier years, and volatile/free-cash-flow contraction in 2025.

Income Statement

Revenue expanded strongly from 2021–2024, but 2025 shows a sharp reported revenue decline (-46.2%), which materially weakens the near-term growth profile. Profitability remains solid and fairly consistent: gross margin improved over time (about 39% in 2020 to ~43% in 2025) while operating profitability stayed steady in the mid-teens; net margin has drifted down versus 2021–2022, indicating some pressure below the operating line. Overall, this is a profitable business with good margin structure, tempered by the unusually weak 2025 revenue growth and modest net margin compression.

Balance Sheet

The balance sheet shows a moderate leverage profile with debt running at roughly two-thirds of equity in the last three years (debt-to-equity ~0.64–0.71). Debt increased meaningfully versus 2021–2022 levels, raising financial risk despite equity still remaining sizable. Returns on equity are consistently healthy in the mid-teens, suggesting efficient capital use, but the higher leverage compared with earlier years reduces flexibility if operating conditions soften.

Cash Flow

Cash generation is solid, with free cash flow consistently high relative to net income (roughly 0.86–0.90 across the period), supporting earnings quality. However, operating cash flow covers less than half of total debt (about 0.36–0.53), implying debt paydown would take time without continued strong cash production. Free cash flow growth is also volatile, including a large contraction in 2025, which adds uncertainty even though absolute cash flow remains strong.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	152.41B	150.16B	140.72B	120.79B	95.01B
Gross Profit	64.97B	62.73B	56.50B	47.93B	37.78B
EBITDA	29.43B	29.85B	26.95B	22.66B	18.02B
Net Income	14.70B	15.64B	13.63B	13.29B	10.90B
Balance Sheet
Total Assets	208.37B	223.60B	196.35B	154.56B	129.97B
Cash, Cash Equivalents and Short-Term Investments	1.40B	4.53B	1.70B	3.42B	4.33B
Total Debt	65.35B	73.50B	65.19B	33.73B	28.75B
Total Liabilities	106.65B	116.52B	104.71B	68.54B	60.38B
Stockholders Equity	101.60B	107.07B	91.63B	86.01B	69.58B
Cash Flow
Free Cash Flow	17.68B	19.33B	18.66B	12.36B	10.74B
Operating Cash Flow	20.13B	21.39B	21.29B	14.36B	12.46B
Investing Cash Flow	-12.37B	-13.93B	-47.90B	-10.56B	-3.09B
Financing Cash Flow	-10.51B	-4.45B	24.73B	-4.70B	-7.81B

Assa Abloy Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 18.76
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ASAZY, the sentiment is Negative. The current price of 18.76 is below the 20-day moving average (MA) of 19.73, below the 50-day MA of 20.23, and above the 200-day MA of 18.23, indicating a bearish trend. The MACD of -0.74 indicates Positive momentum. The RSI at 24.95 is Positive, neither overbought nor oversold. The STOCH value of 9.41 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for ASAZY.

Assa Abloy Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
NSSC	78 Outperform	$1.45B	27.53	27.45%	1.29%	-2.28%	-9.94%
ALLE	72 Outperform	$12.27B	21.24	34.76%	1.27%	6.87%	13.53%
MSA	72 Outperform	$6.60B	22.52	21.82%	1.30%	3.31%	2.58%
ADT	70 Outperform	$5.34B	10.53	16.19%	2.73%	4.77%	-22.78%
ASAZY	65 Neutral	$38.16B	26.90	14.52%	1.27%	8.40%	0.21%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
REZI	56 Neutral	$4.96B	-9.93	-18.10%	―	15.45%	-488.24%