Allegion Stock Falls After Barclays Downgrade
Allegion (NYSE:ALLE) shares fell more than 2% intra-day today after Barclays analysts downgraded the company to Underweight from Equalweight, reducing their price target to $116 from $122.
The analysts cited concerns over Allegion's significant exposure to the US greenfield commercial construction market, which they believe will impact the company's top-line performance. Stable trends in the institutional segment may not be sufficient to offset this impact.
Additionally, the analysts anticipate that margin tailwinds from pricing and cost initiatives will ease, and a potential residential recovery in 2025 could lead to a margin mix headwind.
The lack of secular growth drivers is expected to prevent a re-rating of Allegion's valuation multiple.
| Symbol | Price | %chg |
|---|---|---|
| 9735.T | 5543 | 0 |
| 012750.KS | 64000 | 0 |
| 2331.T | 1162 | 0 |
| ASSA-B.ST | 299.8 | 0 |
Allegion plc (NYSE:ALLE) Earnings Report Highlights
- Allegion reported an EPS of $1.64, missing the estimated $1.75.
- The company's revenue for the quarter ending December 2024 was $945.6 million, surpassing the estimated $938.9 million and demonstrating strong revenue-generating capabilities.
- Financial metrics reveal a P/E ratio of 18.58 and a debt-to-equity ratio of approximately 1.10, indicating a balanced financial leverage and a solid investment opportunity.
Allegion plc (NYSE:ALLE) is a leading global provider of security products and solutions. The company is known for its innovative approach to safety and security, offering a wide range of products that cater to both residential and commercial markets. Allegion operates within the Zacks Security and Safety Services industry, competing with other major players in the sector.
On February 18, 2025, Allegion reported earnings per share (EPS) of $1.64, which fell short of the estimated $1.75. Despite this, the company has a history of outperforming expectations. Allegion's revenue for the quarter ending December 2024 was $945.6 million, exceeding the estimated $938.9 million. This represents a 0.68% increase over the Zacks Consensus Estimate and a significant rise from the $897.4 million reported in the same period the previous year. The company has consistently surpassed consensus revenue estimates in three of the last four quarters, demonstrating its robust revenue-generating capabilities.
The company's financial metrics provide further insight into its market valuation. Allegion's price-to-earnings (P/E) ratio is approximately 18.58, indicating how the market values its earnings. The price-to-sales ratio stands at about 2.93, reflecting the market's valuation of its revenue. Additionally, the enterprise value to sales ratio is around 3.33, suggesting the market's valuation of the company relative to its sales, including debt and excluding cash.
Allegion's financial health is further supported by its debt-to-equity ratio of approximately 1.10, indicating a balanced approach to financial leverage. The company maintains a current ratio of about 2.04, showcasing its ability to cover short-term liabilities with short-term assets. With an earnings yield of about 5.38%, Allegion offers a return on investment based on its earnings, highlighting its potential as a solid investment opportunity.
Allegion plc (NYSE: ALLE) Surpasses Earnings Expectations
- Allegion plc (NYSE:ALLE) reported an EPS of $1.99, exceeding estimates and showcasing its ability to surpass market expectations.
- The company's adjusted net earnings rose to $2.16 per share, indicating an 11.3% increase from the previous year and highlighting Allegion's growth trajectory.
- Despite a slight shortfall in revenue, Allegion's strong financial performance is evident with net earnings reaching $174 million and a healthy price-to-earnings (P/E) ratio of approximately 22.22.
Allegion plc (NYSE:ALLE) is a global leader in security products and solutions, offering a wide range of products that include locks, door closers, and other security devices. The company operates in a competitive market, with key competitors such as Assa Abloy and Dormakaba. Allegion's focus on innovation and customer satisfaction has helped it maintain a strong market position.
On October 24, 2024, Allegion reported earnings per share (EPS) of $1.99, exceeding the estimated $1.93. This performance highlights the company's ability to surpass market expectations, as also noted by the Zacks Consensus Estimate of $1.93 per share. The adjusted net earnings rose to $2.16 per share, marking an 11.3% increase from the previous year, showcasing Allegion's growth trajectory.
Despite generating revenue of approximately $967.1 million, slightly below the estimated $970.89 million, Allegion's net revenues for the third quarter of 2024 were reported at $967 million. This slight shortfall in revenue did not deter the company's overall financial performance, as net earnings reached $174 million. The company's focus on revenue growth and margin expansion is evident in its financial results.
Allegion's financial metrics provide further insight into its market valuation. With a price-to-earnings (P/E) ratio of approximately 22.22, investors are willing to pay $22.22 for every dollar of earnings. The price-to-sales ratio of about 3.41 and enterprise value to sales ratio of around 3.82 reflect the market's valuation of Allegion's revenue and total worth, respectively.
The company's financial health is also indicated by its debt-to-equity ratio of roughly 1.53, showing a balanced approach to financing its assets. A current ratio of approximately 1.71 suggests Allegion's capability to cover short-term liabilities with its short-term assets. The earnings yield of about 4.50% provides insight into the return on investment for shareholders.
