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Here's Why You Should Hold on to Allegion (ALLE) Stock Now
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Allegion plc (ALLE - Free Report) has been benefiting from its solid operational performance owing to strength across its end markets despite softness in the Allegion Americas segment, increasing costs and forex woes.
Let’s discuss the factors that should cause investors to retain the stock for the time being.
Growth Catalysts
Business Strength: Strength in electronics and software solutions end markets are supporting the Allegion International segment. The segment’s revenues increased 3% in the third quarter of 2023. Also, pricing actions are helping the company partly offset inflationary pressure.
Expansion Efforts: ALLE’s expansion initiative is expected to drive growth. It acquired Plano Group through one of its subsidiaries in January 2023. This acquisition expanded its Interflex portfolio and AWFM business with new capabilities in SaaS models and recurring revenue solutions. In the first nine months of 2023, acquisitions boosted sales by 8.3%.
Rewards to Shareholders: The company’s measures to reward its shareholders through dividend payments and share buybacks are noteworthy. Dividends paid out totaled $119.2 million in the first nine months of 2023, up 10.3% from the previous year’s level. At the time of exiting the third quarter of 2023, it was left to repurchase shares worth $500 million under its 2023-approved program. In February 2023, Allegion announced a 10% hike in its quarterly dividend rate, which is now at 45 cents per share.
Currently carrying a Zacks Rank #3 (Hold), ALLE’s shares have jumped 9.7% against the industry’s 3.1% decline.
Image Source: Zacks Investment Research
Stocks to Consider
Some better-ranked companies from the same space are discussed below:
It has a trailing four-quarter average earnings surprise of 38.4%. The Zacks Consensus Estimate for LAKE’s fiscal 2024 earnings increased 8.7% in the past 60 days. Shares of Lakeland have jumped 22.7% in the past year.
MSA Safety Incorporated (MSA - Free Report) currently sports a Zacks Rank #1. It has a trailing four-quarter average earnings surprise of 8%.
The consensus estimate for MSA Safety’s 2023 earnings has remained steady in the past 60 days. Shares of MSA have jumped 28.3% in the past year.
Brady Corporation (BRC - Free Report) presently carries a Zacks Rank #2 (Buy). It has a trailing four-quarter average earnings surprise of 7%.
The Zacks Consensus Estimate for BRC’s fiscal 2024 earnings remained steady in the past 60 days. Shares of Brady have jumped 18% in the past year.
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Here's Why You Should Hold on to Allegion (ALLE) Stock Now
Allegion plc (ALLE - Free Report) has been benefiting from its solid operational performance owing to strength across its end markets despite softness in the Allegion Americas segment, increasing costs and forex woes.
Let’s discuss the factors that should cause investors to retain the stock for the time being.
Growth Catalysts
Business Strength: Strength in electronics and software solutions end markets are supporting the Allegion International segment. The segment’s revenues increased 3% in the third quarter of 2023. Also, pricing actions are helping the company partly offset inflationary pressure.
Expansion Efforts: ALLE’s expansion initiative is expected to drive growth. It acquired Plano Group through one of its subsidiaries in January 2023. This acquisition expanded its Interflex portfolio and AWFM business with new capabilities in SaaS models and recurring revenue solutions. In the first nine months of 2023, acquisitions boosted sales by 8.3%.
Rewards to Shareholders: The company’s measures to reward its shareholders through dividend payments and share buybacks are noteworthy. Dividends paid out totaled $119.2 million in the first nine months of 2023, up 10.3% from the previous year’s level. At the time of exiting the third quarter of 2023, it was left to repurchase shares worth $500 million under its 2023-approved program. In February 2023, Allegion announced a 10% hike in its quarterly dividend rate, which is now at 45 cents per share.
Currently carrying a Zacks Rank #3 (Hold), ALLE’s shares have jumped 9.7% against the industry’s 3.1% decline.
Image Source: Zacks Investment Research
Stocks to Consider
Some better-ranked companies from the same space are discussed below:
Lakeland Industries, Inc. (LAKE - Free Report) presently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
It has a trailing four-quarter average earnings surprise of 38.4%. The Zacks Consensus Estimate for LAKE’s fiscal 2024 earnings increased 8.7% in the past 60 days. Shares of Lakeland have jumped 22.7% in the past year.
MSA Safety Incorporated (MSA - Free Report) currently sports a Zacks Rank #1. It has a trailing four-quarter average earnings surprise of 8%.
The consensus estimate for MSA Safety’s 2023 earnings has remained steady in the past 60 days. Shares of MSA have jumped 28.3% in the past year.
Brady Corporation (BRC - Free Report) presently carries a Zacks Rank #2 (Buy). It has a trailing four-quarter average earnings surprise of 7%.
The Zacks Consensus Estimate for BRC’s fiscal 2024 earnings remained steady in the past 60 days. Shares of Brady have jumped 18% in the past year.