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Reasons to Retain Allegion (ALLE) Stock in Your Portfolio Now
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Allegion plc (ALLE - Free Report) is benefiting from strong operational performance owing to steady demand across its end markets despite lower volumes in the mechanical portfolio, cost inflation and forex woes.
Let us discuss the reasons why investors should retain the stock for the time being.
Growth Catalysts
Business Strength: Solid momentum in electronics and software solutions end markets within the Allegion International segment is supporting the company’s growth. The segment’s revenues increased 3% in the third quarter of 2023. Also, Allegion’s pricing actions are helping the company partly offset inflationary pressure.
Accretive Acquisition: ALLE has been strengthening its business through acquisitions. The company acquired Plano Group through one of its subsidiaries in January 2023. The buyout expanded Allegion’s Interflex portfolio and AWFM business with new capabilities in SaaS models and recurring revenue solutions. In the first nine months of 2023, acquisitions boosted Allegion’s sales by 8.3%.
Rewards to Shareholders: The company continues to increase shareholders’ value through dividend payment & share repurchases. In the first nine months of 2023, Allegion paid out dividends worth $119.2 million, up 10.3% year over year. In 2022, the company disbursed dividends worth $143.9 million and bought back 0.5 million shares for $61 million. In February 2023, Allegion announced a 10% hike in its quarterly dividend rate, which now stands at 45 cents per share.
FLS delivered a trailing four-quarter average earnings surprise of 27.3%. In the past 60 days, the Zacks Consensus Estimate for Flowserve’s 2023 earnings has increased 3.1%. The stock has risen 20% in the past year.
Applied Industrial Technologies, Inc. (AIT - Free Report) presently carries a Zacks Rank of 2. It has a trailing four-quarter average earnings surprise of 13.9%.
The consensus estimate for AIT’s fiscal 2024 earnings has increased 3.7% in the past 60 days. Shares of Applied Industrial have jumped 18.2% in the past year.
A. O. Smith Corporation (AOS - Free Report) currently carries a Zacks Rank of 2. The company delivered a trailing four-quarter average earnings surprise of 14%.
In the past 60 days, the consensus estimate for A. O. Smith’s 2023 earnings has improved 5%. The stock has risen 24.2% in the past year.
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Reasons to Retain Allegion (ALLE) Stock in Your Portfolio Now
Allegion plc (ALLE - Free Report) is benefiting from strong operational performance owing to steady demand across its end markets despite lower volumes in the mechanical portfolio, cost inflation and forex woes.
Let us discuss the reasons why investors should retain the stock for the time being.
Growth Catalysts
Business Strength: Solid momentum in electronics and software solutions end markets within the Allegion International segment is supporting the company’s growth. The segment’s revenues increased 3% in the third quarter of 2023. Also, Allegion’s pricing actions are helping the company partly offset inflationary pressure.
Accretive Acquisition: ALLE has been strengthening its business through acquisitions. The company acquired Plano Group through one of its subsidiaries in January 2023. The buyout expanded Allegion’s Interflex portfolio and AWFM business with new capabilities in SaaS models and recurring revenue solutions. In the first nine months of 2023, acquisitions boosted Allegion’s sales by 8.3%.
Rewards to Shareholders: The company continues to increase shareholders’ value through dividend payment & share repurchases. In the first nine months of 2023, Allegion paid out dividends worth $119.2 million, up 10.3% year over year. In 2022, the company disbursed dividends worth $143.9 million and bought back 0.5 million shares for $61 million. In February 2023, Allegion announced a 10% hike in its quarterly dividend rate, which now stands at 45 cents per share.
Allegion PLC Price and Consensus
Allegion PLC price-consensus-chart | Allegion PLC Quote
In light of the above-mentioned positives, we believe, investors should retain ALLE stock for now, as suggested by its current Zacks Rank #3 (Hold).
Stocks to Consider
Some better-ranked companies from the Industrial Products sector are discussed below:
Flowserve Corporation (FLS - Free Report) presently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
FLS delivered a trailing four-quarter average earnings surprise of 27.3%. In the past 60 days, the Zacks Consensus Estimate for Flowserve’s 2023 earnings has increased 3.1%. The stock has risen 20% in the past year.
Applied Industrial Technologies, Inc. (AIT - Free Report) presently carries a Zacks Rank of 2. It has a trailing four-quarter average earnings surprise of 13.9%.
The consensus estimate for AIT’s fiscal 2024 earnings has increased 3.7% in the past 60 days. Shares of Applied Industrial have jumped 18.2% in the past year.
A. O. Smith Corporation (AOS - Free Report) currently carries a Zacks Rank of 2. The company delivered a trailing four-quarter average earnings surprise of 14%.
In the past 60 days, the consensus estimate for A. O. Smith’s 2023 earnings has improved 5%. The stock has risen 24.2% in the past year.