With a market cap of $12.3 billion, Allegion plc (ALLE) is a global leader in mechanical and electronic security products, offering a comprehensive range of solutions. Based in Dublin, Ireland, the company serves residential, institutional, and commercial markets worldwide through diverse distribution and retail channels, including e-commerce and specialty outlets.
Shares of Allegion have slightly outperformed the broader market over the past 52 weeks. ALLE has increased 33.7% over this time frame, while the broader S&P 500 Index ($SPX) has rallied 32.1%. However, in 2024, shares of ALLE are up 10.8%, lagging behind SPX’s 26.2% gain on a YTD basis.
Focusing more closely, the security device maker has lagged behind the Industrial Select Sector SPDR Fund’s (XLI) 36.3% return over the past 52 weeks and a 26.4% YTD gain.
Despite reporting stronger-than-expected Q3 adjusted EPS of $2.16 and revenue of $967.1 million, shares of Allegion fell 3.7% on Oct. 24 due to concerns over weaker-than-expected growth in its residential business, which was impacted by high mortgage rates and rising home prices. Furthermore, the international segment’s lower operating income of $17.9 million and rising interest expenses also contributed to the negative market reaction.
For the current fiscal year, ending in December, analysts expect ALLE’s EPS to grow 6.5% year-over-year to $7.41. The company's earnings surprise history is promising. It topped the consensus estimates in the last four quarters.
Among the eight analysts covering the stock, the consensus rating is a “Hold.” That’s based on two “Strong Buy” ratings, four “Holds,” one “Moderate Sell,” and one “Strong Sell.”
On Oct. 28, Barclays raised Allegion's price target to $137 and maintained an “Underweight” rating, citing improvements in its acquisition strategy and a rebound in electronic locks.
As of writing, ALLE is trading below the mean price target of $147. The Street-high price target of $165, implies a potential upside of 17.5% from the current price levels.
On the date of publication, Sohini Mondal did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here. More news from Barchart- New Engine Beats Ford, General Motors, and Tesla By a Mile With 200% More Efficiency, 100% More Power, and 50% of the Cost
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