ALLEGION PLC (ALLE) Stock Fundamental Analysis
NYSE:ALLE - New York Stock Exchange, Inc. - IE00BFRT3W74 - Common Stock - Currency: USD
Taking everything into account, ALLE scores 6 out of 10 in our fundamental rating. ALLE was compared to 41 industry peers in the Building Products industry. While ALLE has a great profitability rating, there are some minor concerns on its financial health. ALLE has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
ALLE had positive earnings in the past year.
In the past year ALLE had a positive cash flow from operations.
ALLE had positive earnings in each of the past 5 years.
In the past 5 years ALLE always reported a positive cash flow from operatings.
1.2 Ratios
ALLE's Return On Assets of 13.31% is fine compared to the rest of the industry. ALLE outperforms 78.05% of its industry peers.
ALLE has a Return On Equity of 39.81%. This is amongst the best in the industry. ALLE outperforms 90.24% of its industry peers.
Looking at the Return On Invested Capital, with a value of 17.82%, ALLE belongs to the top of the industry, outperforming 85.37% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for ALLE is significantly above the industry average of 12.93%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 13.31% | ||
| ROE | 39.81% | ||
| ROIC | 17.82% |
ROA(3y)12.44%
ROA(5y)12.68%
ROE(3y)43.15%
ROE(5y)46.19%
ROIC(3y)18.02%
ROIC(5y)18.47%
1.3 Margins
With an excellent Profit Margin value of 15.84%, ALLE belongs to the best of the industry, outperforming 85.37% of the companies in the same industry.
ALLE's Profit Margin has improved in the last couple of years.
ALLE's Operating Margin of 20.70% is amongst the best of the industry. ALLE outperforms 87.80% of its industry peers.
ALLE's Operating Margin has been stable in the last couple of years.
ALLE has a Gross Margin of 44.23%. This is amongst the best in the industry. ALLE outperforms 87.80% of its industry peers.
In the last couple of years the Gross Margin of ALLE has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 20.7% | ||
| PM (TTM) | 15.84% | ||
| GM | 44.23% |
OM growth 3Y4.04%
OM growth 5Y0.9%
PM growth 3Y-2.03%
PM growth 5Y2.39%
GM growth 3Y1.72%
GM growth 5Y0.16%
2. Health
2.1 Basic Checks
ALLE has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
ALLE has less shares outstanding than it did 1 year ago.
ALLE has less shares outstanding than it did 5 years ago.
Compared to 1 year ago, ALLE has an improved debt to assets ratio.
2.2 Solvency
ALLE has an Altman-Z score of 4.37. This indicates that ALLE is financially healthy and has little risk of bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 4.37, ALLE is in line with its industry, outperforming 58.54% of the companies in the same industry.
The Debt to FCF ratio of ALLE is 3.43, which is a good value as it means it would take ALLE, 3.43 years of fcf income to pay off all of its debts.
With a Debt to FCF ratio value of 3.43, ALLE perfoms like the industry average, outperforming 56.10% of the companies in the same industry.
A Debt/Equity ratio of 1.32 is on the high side and indicates that ALLE has dependencies on debt financing.
ALLE's Debt to Equity ratio of 1.32 is on the low side compared to the rest of the industry. ALLE is outperformed by 85.37% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.32 | ||
| Debt/FCF | 3.43 | ||
| Altman-Z | 4.37 |
ROIC/WACC2.49
WACC7.17%
2.3 Liquidity
ALLE has a Current Ratio of 2.04. This indicates that ALLE is financially healthy and has no problem in meeting its short term obligations.
ALLE has a Current ratio (2.04) which is in line with its industry peers.
A Quick Ratio of 1.43 indicates that ALLE should not have too much problems paying its short term obligations.
ALLE has a Quick ratio (1.43) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.04 | ||
| Quick Ratio | 1.43 |
3. Growth
3.1 Past
ALLE shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 8.19%, which is quite good.
Measured over the past years, ALLE shows a quite strong growth in Earnings Per Share. The EPS has been growing by 9.02% on average per year.
The Revenue has been growing slightly by 3.33% in the past year.
ALLE shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 5.74% yearly.
EPS 1Y (TTM)8.19%
EPS 3Y13.21%
EPS 5Y9.02%
EPS Q2Q%10.71%
Revenue 1Y (TTM)3.33%
Revenue growth 3Y9.57%
Revenue growth 5Y5.74%
Sales Q2Q%5.37%
3.2 Future
Based on estimates for the next years, ALLE will show a quite strong growth in Earnings Per Share. The EPS will grow by 8.48% on average per year.
The Revenue is expected to grow by 6.95% on average over the next years.
EPS Next Y5.13%
EPS Next 2Y6.63%
EPS Next 3Y7.7%
EPS Next 5Y8.48%
Revenue Next Year2.5%
Revenue Next 2Y3.38%
Revenue Next 3Y3.66%
Revenue Next 5Y6.95%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 16.78, the valuation of ALLE can be described as correct.
ALLE's Price/Earnings ratio is a bit cheaper when compared to the industry. ALLE is cheaper than 60.98% of the companies in the same industry.
When comparing the Price/Earnings ratio of ALLE to the average of the S&P500 Index (28.29), we can say ALLE is valued slightly cheaper.
With a Price/Forward Earnings ratio of 15.96, ALLE is valued correctly.
ALLE's Price/Forward Earnings ratio is in line with the industry average.
ALLE's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 21.32.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.78 | ||
| Fwd PE | 15.96 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as ALLE.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of ALLE is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 18.7 | ||
| EV/EBITDA | 13.78 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates ALLE does not grow enough to justify the current Price/Earnings ratio.
ALLE has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)3.27
PEG (5Y)1.86
EPS Next 2Y6.63%
EPS Next 3Y7.7%
5. Dividend
5.1 Amount
ALLE has a Yearly Dividend Yield of 1.61%. Purely for dividend investing, there may be better candidates out there.
ALLE's Dividend Yield is rather good when compared to the industry average which is at 1.28. ALLE pays more dividend than 82.93% of the companies in the same industry.
ALLE's Dividend Yield is slightly below the S&P500 average, which is at 2.51.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.61% |
5.2 History
The dividend of ALLE is nicely growing with an annual growth rate of 12.34%!
ALLE has paid a dividend for at least 10 years, which is a reliable track record.
As ALLE did not decrease their dividend in the past 5 years, we can say the dividend looks stable.
Dividend Growth(5Y)12.34%
Div Incr Years9
Div Non Decr Years9
5.3 Sustainability
ALLE pays out 27.95% of its income as dividend. This is a sustainable payout ratio.
ALLE's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP27.95%
EPS Next 2Y6.63%
EPS Next 3Y7.7%
126.35
+1.22 (+0.97%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryBuilding Products
Earnings (Last)
Earnings (Next)
Inst Owners98.81%
Inst Owner Change0.37%
Ins Owners0.23%
Ins Owner Change5.55%
Market Cap10.90B
Analysts70
Price Target142.94 (13.13%)
Short Float %2.46%
Short Ratio2.31
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.61% |
Yearly Dividend1.92
Dividend Growth(5Y)12.34%
DP27.95%
Div Incr Years9
Div Non Decr Years9
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)5.44%
Min EPS beat(2)4.12%
Max EPS beat(2)6.75%
EPS beat(4)4
Avg EPS beat(4)4.99%
Min EPS beat(4)4.12%
Max EPS beat(4)6.75%
EPS beat(8)8
Avg EPS beat(8)6.09%
EPS beat(12)12
Avg EPS beat(12)6.6%
EPS beat(16)15
Avg EPS beat(16)7.39%
Revenue beat(2)0
Avg Revenue beat(2)-1.79%
Min Revenue beat(2)-2.34%
Max Revenue beat(2)-1.23%
Revenue beat(4)0
Avg Revenue beat(4)-1.3%
Min Revenue beat(4)-2.34%
Max Revenue beat(4)-0.72%
Revenue beat(8)1
Avg Revenue beat(8)-0.75%
Revenue beat(12)3
Avg Revenue beat(12)-0.26%
Revenue beat(16)6
Avg Revenue beat(16)0.3%
PT rev (1m)0.29%
PT rev (3m)-5.11%
EPS NQ rev (1m)0.07%
EPS NQ rev (3m)-0.08%
EPS NY rev (1m)-0.43%
EPS NY rev (3m)-0.41%
Revenue NQ rev (1m)-0.26%
Revenue NQ rev (3m)-1.38%
Revenue NY rev (1m)0.03%
Revenue NY rev (3m)-1.43%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.78 | ||
| Fwd PE | 15.96 | ||
| P/S | 2.89 | ||
| P/FCF | 18.7 | ||
| P/OCF | 16.15 | ||
| P/B | 7.27 | ||
| P/tB | N/A | ||
| EV/EBITDA | 13.78 |
EPS(TTM)7.53
EY5.96%
EPS(NY)7.92
Fwd EY6.27%
FCF(TTM)6.76
FCFY5.35%
OCF(TTM)7.82
OCFY6.19%
SpS43.72
BVpS17.39
TBVpS-6.46
PEG (NY)3.27
PEG (5Y)1.86
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 13.31% | ||
| ROE | 39.81% | ||
| ROCE | 20.59% | ||
| ROIC | 17.82% | ||
| ROICexc | 20.56% | ||
| ROICexgc | 54.99% | ||
| OM | 20.7% | ||
| PM (TTM) | 15.84% | ||
| GM | 44.23% | ||
| FCFM | 15.45% |
ROA(3y)12.44%
ROA(5y)12.68%
ROE(3y)43.15%
ROE(5y)46.19%
ROIC(3y)18.02%
ROIC(5y)18.47%
ROICexc(3y)20.58%
ROICexc(5y)21.64%
ROICexgc(3y)65.23%
ROICexgc(5y)63.68%
ROCE(3y)20.82%
ROCE(5y)21.34%
ROICexcg growth 3Y-1.17%
ROICexcg growth 5Y-4.11%
ROICexc growth 3Y-2.57%
ROICexc growth 5Y-2.41%
OM growth 3Y4.04%
OM growth 5Y0.9%
PM growth 3Y-2.03%
PM growth 5Y2.39%
GM growth 3Y1.72%
GM growth 5Y0.16%
F-Score7
Asset Turnover0.84
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.32 | ||
| Debt/FCF | 3.43 | ||
| Debt/EBITDA | 2.2 | ||
| Cap/Depr | 77.4% | ||
| Cap/Sales | 2.44% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 75.03% | ||
| Profit Quality | 97.56% | ||
| Current Ratio | 2.04 | ||
| Quick Ratio | 1.43 | ||
| Altman-Z | 4.37 |
F-Score7
WACC7.17%
ROIC/WACC2.49
Cap/Depr(3y)72.74%
Cap/Depr(5y)66.2%
Cap/Sales(3y)2.23%
Cap/Sales(5y)2%
Profit Quality(3y)93.16%
Profit Quality(5y)102.45%
High Growth Momentum
Growth
EPS 1Y (TTM)8.19%
EPS 3Y13.21%
EPS 5Y9.02%
EPS Q2Q%10.71%
EPS Next Y5.13%
EPS Next 2Y6.63%
EPS Next 3Y7.7%
EPS Next 5Y8.48%
Revenue 1Y (TTM)3.33%
Revenue growth 3Y9.57%
Revenue growth 5Y5.74%
Sales Q2Q%5.37%
Revenue Next Year2.5%
Revenue Next 2Y3.38%
Revenue Next 3Y3.66%
Revenue Next 5Y6.95%
EBIT growth 1Y5.94%
EBIT growth 3Y14%
EBIT growth 5Y6.69%
EBIT Next Year20.65%
EBIT Next 3Y11.31%
EBIT Next 5Y9.62%
FCF growth 1Y12.88%
FCF growth 3Y9.56%
FCF growth 5Y6.64%
OCF growth 1Y12.39%
OCF growth 3Y11.37%
OCF growth 5Y6.69%