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1. Company Snapshot

1.a. 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.

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1.b. Last Insights on ALLE

Allegion's recent performance was negatively impacted by its Q4 earnings miss, with earnings per share of $1.94, falling short of the Zacks Consensus Estimate of $2.01. Despite a 9% revenue increase, margin expansion, and upbeat 2026 growth guidance, investor sentiment was dampened. Additionally, institutional investors such as Cooke & Bieler LP and Generali Asset Management SPA SGR reduced their stakes in the company. Analysts have a consensus "Hold" rating on Allegion, according to MarketBeat Ratings.

1.c. Company Highlights

2. Allegion's Q4 Earnings: A Resilient Performance Amidst a Challenging Environment

Allegion's financial performance in Q4 was marked by a 6.1% increase in reported revenue and a 4.8% organic growth in the Americas segment, driven by the nonresidential business. The company's adjusted EPS came in at $1.71, missing estimates of $2.01. The International segment saw a 21.5% increase in reported revenue, with organic revenue declining by 2.3% due to weaknesses in mechanical businesses. The company's full-year 2025 performance was strong, with high single-digit enterprise revenue growth and over $600 million in accretive M&A.

Publication Date: Feb -18

📋 Highlights
  • 2025 Revenue Growth:: Enterprise revenue grew high single digits in 2025, with $600M+ in accretive M&A and solid execution amid inflation.
  • 2026 EPS Guidance:: Adjusted EPS targets $8.70–$8.90/share (8% growth midpoint), driven by Americas nonresidential and International electronics growth.
  • Americas Performance:: Q4 revenue rose 6.1% reported/4.8% organic, led by nonresidential business (+high single digits organically).
  • International Segment Dynamics:: 21.5% reported revenue growth offset by -2.3% organic decline, with electronics outperforming mechanical categories.
  • 2026 Revenue Outlook:: Total revenue growth of 5–7%, organic growth of 2–4%, prioritizing nonresidential Americas and electronics-led International growth.

Segment Performance

The Americas segment's resilience in Q4 was driven by nonresidential business growth, which increased by high single digits organically. The International segment's growth was largely driven by electronics businesses, with net acquisitions contributing 16 points to segment revenue. As noted by John Stone, "We expect total Allegion revenue growth to be 5% to 7% and organic revenue growth to be 2% to 4%" in 2026, with the Americas segment expected to lead the growth.

Guidance and Outlook

Allegion initiated fiscal year 2026 adjusted EPS guidance of $8.70 to $8.90 per share, representing growth of approximately 8% at the midpoint. The company's outlook assumes continued growth led by Americas nonresidential, with a more modest price contribution due to lower inflation. Analysts estimate revenue growth of 4.5% for the next year, which is within the company's guided range.

Valuation Metrics

Allegion's current valuation metrics indicate a P/E Ratio of 21.75, P/B Ratio of 5.63, and EV/EBITDA of 16.13. The company's ROE is 32.9%, and ROIC is 16.12%. The Dividend Yield is 1.25%, and Free Cash Flow Yield is 5.02%. These metrics suggest that the company's stock is fairly valued, with a reasonable price-to-earnings multiple and a decent dividend yield.

Margin Performance

The company's margin performance was impacted by higher costs, but was supported by pricing and productivity gains. As Michael Wagnes noted, "We put all that information in our 10-K... We'll see a little less pricing in total, with enterprise and Americas revenue experiencing a bit more pricing than volume." The company's Americas margins in Q4 were down year-over-year due to a substantial residential volume decline, despite positive pricing.

3. NewsRoom

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Allegion to Attend 2026 J.P. Morgan Industrials Conference

Mar -11

Source: businesswire.com

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2 Stocks Using Market Chaos To Grow Their Dividends

Mar -11

Source: forbes.com

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Halma (OTCMKTS:HLMAF) vs. Allegion (NYSE:ALLE) Head-To-Head Survey

Mar -11

Source: defenseworld.net

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Allegion Acquires DCI Hollow Metal on Demand

Mar -04

Source: businesswire.com

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Andra AP fonden Acquires 28,319 Shares of Allegion PLC $ALLE

Feb -27

Source: defenseworld.net

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Allegion: The Recent Decline Makes It A Buy

Feb -27

Source: seekingalpha.com

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ALRM or ALLE: Which Is the Better Value Stock Right Now?

Feb -25

Source: zacks.com

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Insider Selling: Allegion (NYSE:ALLE) Director Sells $65,516.00 in Stock

Feb -23

Source: defenseworld.net

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (3.85%)

6. Segments

Mechanical

Expected Growth: 3.5%

Allegion's Mechanical segment growth is driven by increasing demand for electronic access control solutions, adoption of smart locks in residential and commercial markets, and expansion in emerging markets. Additionally, the company's strategic acquisitions and investments in digital technologies, such as biometric authentication, are expected to contribute to the 3.5% growth rate.

Electronic

Expected Growth: 4.5%

Allegion plc's Electronic segment growth of 4.5% is driven by increasing demand for electronic access control solutions, growth in the Americas and EMEA regions, and rising adoption of smart home technology. Additionally, the company's strategic acquisitions and investments in digital platforms have expanded its product offerings and enhanced its competitive position.

Services and Software

Expected Growth: 4.8%

Allegion plc's Services and Software segment growth of 4.8% is driven by increasing demand for electronic access control solutions, growth in cloud-based access control, and rising adoption of digital door locks. Additionally, the company's strategic acquisitions and investments in digital technologies have expanded its offerings, contributing to the segment's growth.

7. Detailed Products

Schlage Locks

Mechanical and electronic locks for residential and commercial applications

LCN Door Closers

Door control systems for commercial and institutional applications

Von Duprin Exit Devices

Exit devices for emergency egress and panic exit hardware

Falcon Locks

Commercial-grade locks for high-security applications

SimonsVoss Digital Locks

Electronic locks with advanced features such as biometric authentication

Interflex Access Control

Access control systems for managing and monitoring access to secure areas

8. Allegion plc's Porter Forces

Forces Ranking

Threat Of Substitutes

Allegion plc operates in the security industry, which has a moderate threat of substitutes. While there are some substitutes available, they are not highly attractive to customers, and Allegion's products and services are differentiated enough to maintain a competitive edge.

Bargaining Power Of Customers

Allegion plc's customers have limited bargaining power due to the company's strong brand reputation and the specialized nature of its products and services.

Bargaining Power Of Suppliers

Allegion plc's suppliers have some bargaining power due to the company's dependence on them for raw materials and components. However, the company's large scale of operations and diversified supply chain mitigate this risk.

Threat Of New Entrants

The threat of new entrants in the security industry is low due to the high barriers to entry, including significant capital requirements, regulatory hurdles, and the need for specialized expertise.

Intensity Of Rivalry

The security industry is highly competitive, with several established players competing for market share. Allegion plc faces intense rivalry from companies such as ASSA ABLOY, Stanley Black & Decker, and Dormakaba.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 60.45%
Debt Cost 5.28%
Equity Weight 39.55%
Equity Cost 9.69%
WACC 7.02%
Leverage 152.85%

11. Quality Control: Allegion plc passed 5 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Bouygues

A-Score: 7.1/10

Value: 7.8

Growth: 5.3

Quality: 3.6

Yield: 8.1

Momentum: 9.0

Volatility: 8.7

1-Year Total Return ->

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Stock-Card
Stolt-Nielsen

A-Score: 6.6/10

Value: 9.0

Growth: 6.8

Quality: 5.2

Yield: 9.4

Momentum: 4.5

Volatility: 4.7

1-Year Total Return ->

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Stock-Card
Securitas

A-Score: 5.7/10

Value: 5.7

Growth: 4.4

Quality: 3.9

Yield: 6.2

Momentum: 5.0

Volatility: 8.7

1-Year Total Return ->

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Stock-Card
Allegion

A-Score: 5.4/10

Value: 2.3

Growth: 6.3

Quality: 6.9

Yield: 2.5

Momentum: 6.5

Volatility: 8.0

1-Year Total Return ->

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Stock-Card
Danieli

A-Score: 5.3/10

Value: 6.8

Growth: 3.4

Quality: 5.1

Yield: 1.9

Momentum: 9.5

Volatility: 5.0

1-Year Total Return ->

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Stock-Card
Dormakaba

A-Score: 4.7/10

Value: 3.5

Growth: 5.1

Quality: 5.1

Yield: 3.8

Momentum: 3.0

Volatility: 7.7

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

145.35$

Current Price

145.35$

Potential

-0.00%

Expected Cash-Flows