Is Allegion Stock Underperforming the S&P 500?

• April 2, 2025

Dublin, Ireland-based Allegion plc ALLE is a global leader in security products and solutions, catering to both commercial and residential needs. With a market cap of $11.3 billion , the company specializes in locks, access control systems, and door hardware, offering innovative solutions under renowned brands like Schlage and Von Duprin.

Companies worth $10 billion or more are generally described as "large-cap stocks," Allegion fits right into that category, reflecting its significant presence and influence in the security and safety industry, providing cutting-edge products to enhance security worldwide.

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ALLE stock currently trades 16.1% below its all-time high of $156.10 touched Oct. 18, last year. Meanwhile, ALLE has observed a marginal 24 bps uptick over the past three months, notably outpacing the S&P 500 Index’s ($SPX) 4.2% decline during the same time frame.

However, Allegion has notably underperformed the broader market over the longer time frame. ALLE stock has declined 9.6% over the past six months and 1% over the past 52 weeks, compared to SPX’s 1.3% dip over the past six months and 7.4% gains over the past year.

To confirm the downturn, ALLE has traded mostly below its 50-day moving average since late October 2024 and below its 200-day moving average since mid-December with some fluctuations.

Despite beating Street expectations, Allegion’s stock prices plunged 5.6% after the release of its Q4 results on Feb. 18. Driven by solid growth in revenues from the Americas region and an uptick in organic as well as acquisition-led revenues, the company’s overall topline increased 5.4% year-over-year to $945.6 million, which surpassed the consensus estimates by a small margin. Meanwhile, driven by operational efficiencies, the company also experienced modest margin expansion. Its adjusted EPS for the quarter surged 10.7% year-over-year to $1.86, surpassing the analysts’ projections by 6.9%.

For the full fiscal 2024, Allegion’s topline increased 3.3% year-over-year to $3.8 billion and its adjusted EPS grew 8.2% to $7.53. However, in 2025, the company expects to observe a notable slowdown in earnings and revenue growth. Allegion expects its 2025 revenues to grow between 1% to 3% and adjusted EPS to range between $7.65 to $7.85, representing a modest 2.9% growth at the midpoint, which unsettled investor confidence.

Meanwhile, Allegion has significantly underperformed its peer ADT Inc.’s ADT 15.7% surge over the past six months and 25.7% gains over the past 52 weeks.

Furthermore, analysts remain cautious about the stock’s prospects. Among the nine analysts covering ALLE, the consensus rating is a “Hold.” Its mean price target of $137.75 suggests a 5.2% upside potential from current price levels.

On the date of publication, Aditya Sarawgi 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.