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Allegion PLC ALLE Stock Quote

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Morningstar‘s Stock Analysis ALLE

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Economic Moat

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Capital Allocation

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Still-Strong Nonresidential Construction Activity Should Bolster Allegion's Financial Performance

Business Strategy and Outlook

| Brian Bernard, CFA, CPA |

Allegion, a global leader in security products and solutions, was spun off from Ingersoll-Rand in December 2013. No longer forced to compete for capital from a conglomerate parent, Allegion is now able to employ a more robust acquisition strategy to expand its scale, technological capabilities, and product portfolio. At over 70% of sales and 80% of segment profitability, Allegion’s Americas segment is the firm’s largest and strongest business, with a leading position in locks, exit devices, and door controls. The Americas business has been the key driver of Allegion’s stable, industry-leading profitability, which is a testament to the firm’s market position and pricing power. We expect the Americas business to post mid-to-high single-digit organic growth after the coronavirus-fueled downturn in 2020-21 as the segment capitalizes on increased retrofit and upgrade spending across commercial and residential end markets that is drive by the convergence of electronics and mechanical security solutions, elevated U.S. residential construction, and strategic acquisitions. The segment’s already strong profit margins should benefit from a mix-shift to higher-priced electronics products and operating leverage on increased volumes, partially offset by structurally lower profit margins from the acquired access technologies business.

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Key Statistics ALLE

Company Profile ALLE

Business Description

Allegion is a global security products company with a portfolio of leading brands, such as Schlage, von Duprin, and LCN. The Ireland-domiciled company was created via a spinoff transaction from Ingersoll-Rand in December 2013. In fiscal 2021, Allegion generated 68% of sales in the United States. The company mainly competes with Swedish-based Assa Abloy AB and Switzerland-based Dormakaba.

Contact
Harcourt Road, Iveagh Court, Block D
Dublin 2, D02 VH94, Ireland
T +353 12546200
Industry Security & Protection Services
Most Recent Earnings Jun 30, 2022
Fiscal Year End Dec 31, 2022
Employees 11,000