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Allegion plc (ALLE - Free Report) recently completed the acquisition of electro-mechanical access control solutions provider — Montajes electronics Dorcas S.L. (“Dorcas”). The financial terms of the transaction were kept under wraps.
Allegion’s shares inched up 1.6% yesterday to eventually close the trading session at $128.79.
Headquartered in Siete Aguas, Spain, Dorcas specializes in manufacturing electro-mechanical and electro-magnetic locks, electric strikes, complementary access control solutions and door control products. The company’s access control solutions are used by a strong customer base, particularly in European markets.
Acquisition Rationale
The latest buyout is in sync with Allegion’s policy of acquiring businesses to expand its market share and customer base. The inclusion of Dorcas’ expertise in electric strikes and lock solutions, coupled with its strong innovation capabilities, will enable Allegion to boost its security products portfolio. It will help ALLE expand its presence in lucrative end markets like healthcare and education.
Dorcas will be incorporated into Allegion’s international segment and will be led by its senior vice president, Tim Eckersley.
Acquisitions are an essential aspect of Allegion's growth strategy. The company is trying to improve its long-term results by focusing on strategic acquisitions and regular innovations. In February 2024, ALLE acquired Boss Door Controls, expanding its U.K. Business with a complementary portfolio and broader channel access. In January, it acquired assets of software-as-a-service (SaaS) workforce management solutions company Plano Group. The buyout expanded the company’s Interflex portfolio and its AWFM business with new capabilities in SaaS models.
Zacks Rank, Price Performance and Estimate Revisions
Allegion, with approximately $11.3 billion market capitalization, currently carries a Zacks Rank #3 (Hold). The company will benefit from strength in the electronic products business, along with product development and a large customer base, in the long term. However, soft demand across home builder markets is a concern.
Image Source: Zacks Investment Research
In the past three months, the company’s shares have increased 22.5% compared with the industry’s growth of 15.9%.
The Zacks Consensus Estimate for its earnings is pegged at $6.90 for 2024, suggesting an increase of 2.7% from the 30-day-ago figure.
Key Picks
Some better-ranked stocks from the same space are presented below.
NSSC delivered a trailing four-quarter average earnings surprise of 27.7%. In the past 30 days, the Zacks Consensus Estimate for Napco Security’s 2024 earnings has increased 16.1%.
MSA Safety Incorporated (MSA - Free Report) sports a Zacks Rank #1. MSA delivered a trailing four-quarter average earnings surprise of 21.8%. In the past 30 days, the Zacks Consensus Estimate for its 2024 earnings has increased 4.3%.
Cadre Holdings, Inc. (CDRE - Free Report) presently has a Zacks Rank of 2 (Buy). CDRE delivered a trailing four-quarter average earnings surprise of 32.8%. In the past 30 days, the Zacks Consensus Estimate for its 2024 earnings has increased 1.8%.
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Allegion (ALLE) Buys Dorcas, Strengthens Product Offerings
Allegion plc (ALLE - Free Report) recently completed the acquisition of electro-mechanical access control solutions provider — Montajes electronics Dorcas S.L. (“Dorcas”). The financial terms of the transaction were kept under wraps.
Allegion’s shares inched up 1.6% yesterday to eventually close the trading session at $128.79.
Headquartered in Siete Aguas, Spain, Dorcas specializes in manufacturing electro-mechanical and electro-magnetic locks, electric strikes, complementary access control solutions and door control products. The company’s access control solutions are used by a strong customer base, particularly in European markets.
Acquisition Rationale
The latest buyout is in sync with Allegion’s policy of acquiring businesses to expand its market share and customer base. The inclusion of Dorcas’ expertise in electric strikes and lock solutions, coupled with its strong innovation capabilities, will enable Allegion to boost its security products portfolio. It will help ALLE expand its presence in lucrative end markets like healthcare and education.
Dorcas will be incorporated into Allegion’s international segment and will be led by its senior vice president, Tim Eckersley.
Acquisitions are an essential aspect of Allegion's growth strategy. The company is trying to improve its long-term results by focusing on strategic acquisitions and regular innovations. In February 2024, ALLE acquired Boss Door Controls, expanding its U.K. Business with a complementary portfolio and broader channel access. In January, it acquired assets of software-as-a-service (SaaS) workforce management solutions company Plano Group. The buyout expanded the company’s Interflex portfolio and its AWFM business with new capabilities in SaaS models.
Zacks Rank, Price Performance and Estimate Revisions
Allegion, with approximately $11.3 billion market capitalization, currently carries a Zacks Rank #3 (Hold). The company will benefit from strength in the electronic products business, along with product development and a large customer base, in the long term. However, soft demand across home builder markets is a concern.
Image Source: Zacks Investment Research
In the past three months, the company’s shares have increased 22.5% compared with the industry’s growth of 15.9%.
The Zacks Consensus Estimate for its earnings is pegged at $6.90 for 2024, suggesting an increase of 2.7% from the 30-day-ago figure.
Key Picks
Some better-ranked stocks from the same space are presented below.
Napco Security Technologies, Inc. (NSSC - Free Report) flaunts a Zacks Rank of 1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
NSSC delivered a trailing four-quarter average earnings surprise of 27.7%. In the past 30 days, the Zacks Consensus Estimate for Napco Security’s 2024 earnings has increased 16.1%.
MSA Safety Incorporated (MSA - Free Report) sports a Zacks Rank #1. MSA delivered a trailing four-quarter average earnings surprise of 21.8%. In the past 30 days, the Zacks Consensus Estimate for its 2024 earnings has increased 4.3%.
Cadre Holdings, Inc. (CDRE - Free Report) presently has a Zacks Rank of 2 (Buy). CDRE delivered a trailing four-quarter average earnings surprise of 32.8%. In the past 30 days, the Zacks Consensus Estimate for its 2024 earnings has increased 1.8%.