Allegion plc ALLE is poised to benefit from strength across its businesses, focus on operational excellence, accretive acquisitions and shareholder-friendly policies. The company remains focused on investing in growth opportunities and strengthening its long-term market position.

ALLE, which has a market capitalization of $10.7 billion, currently carries a Zacks Rank #2 (Buy). Let’s delve into the factors that have been aiding the firm for a while now.

Business Strength: Allegion is benefiting from strong momentum across its segments. Stable demand across several end markets like education, healthcare, government, hospitality and retail within the non-residential business is driving the Americas segment. The increase in demand for residential and non-residential products also bodes well. The segment’s revenues increased 6.4% year over year in the fourth quarter of 2024.

Increased demand for electronic security products, driven by growing awareness about the security and safety of people and infrastructure, is aiding the Allegion International segment. It is worth noting that the segmental revenues increased 1.5% year over year in the fourth quarter.

For 2025, the company expects the Allegion Americas segment’s revenues to increase in the low to mid-single-digits and the Allegion International segment’s revenues to be flat year over year.

Accretive Acquisitions: Allegion is focused on strengthening its business and product offerings through acquisitions. In April 2025, ALLE acquired Trimco Hardware (Trimco), along with its brands and various assets, through one of its subsidiaries. The inclusion of Trimco’s expertise in specialty solutions, coupled with its strong innovation capabilities, will enable ALLE to boost its door and frame portfolio. 

In June 2024, the company acquired Krieger Specialty Products. The addition of Krieger’s expertise in specialty solutions enabled ALLE to strengthen its door and frame portfolio. In the same month, it purchased Unicel Architectural Corp, which enabled it to boost its product portfolio within the non-residential business. Both the acquired businesses have been incorporated into the Americas segment. 

Also, in February 2025, it inked a deal to buy Lemaar Pty Ltd. (Lemaar). This acquisition is expected to boost Allegion’s security and accessibility portfolio in Australia. It’s worth noting that in the fourth quarter, acquisitions boosted the company’s sales by 2%.

ALLE Stock’s Price Performance

In the past three months, the company’s shares have lost 3.7% compared with the industry‘s 11.7% decline. Although its shares have declined in the past three months, the stock has soared 23.2% in the past couple of years, higher than the 9.1% growth recorded by the industry.

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Rewards to Shareholders: The company remains committed to increasing shareholders’ value through dividend payments and share repurchases. In 2024, it paid out dividends of $166.9 million, reflecting an increase of 5.2% year over year. In the same period, Allegion repurchased shares for $220 million.

Exiting 2024, ALLE was left to repurchase shares worth $240 million under its 2023-approved program. Also, in February 2025, it announced a 6% hike in its quarterly dividend rate, which is currently 51 cents per share.

Estimate Revisions: The Zacks Consensus Estimate for ALLE’s 2025 earnings is pegged at $7.73 per share, indicating an increase of 1.6% from the 60-day-ago figure. The consensus estimate for 2026 earnings is pegged at $8.15 per share, indicating a rise of 5.1% in the same period.

Other Key Picks

Other top-ranked stocks from the same space are discussed below.

ADT Inc. ADT presently carries a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. 

It has a trailing four-quarter earnings surprise of 6.3%, on average. The consensus estimate for ADT’s 2025 earnings has increased 1.2% in the past 60 days.

Emerson Electric Co. EMR presently carries a Zacks Rank of 2. It has a trailing four-quarter average earnings surprise of 4.3%. 

The Zacks Consensus Estimate for EMR’s fiscal 2025 (ending September 2025) earnings has improved 1% in the past 60 days.

AZZ Inc. AZZ currently carries a Zacks Rank of 2. AZZ delivered a trailing four-quarter average earnings surprise of 15.2%. In the past 60 days, the Zacks Consensus Estimate for AZZ’s fiscal 2025 (ended February 2025) earnings has decreased 1.3%.

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This article originally published on Zacks Investment Research (zacks.com).

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